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News that the Treasury Department’s Inspector General has opened an investigation to determine whether three solar companies inflated the cost of their work to increase the payments they would receive from the government should send shivers down the spine of the taxpayer-subsidized green energy industry.
The Washington Post reports that SolarCity, SunRun and Sungevity have received subpoenas from the Treasury Department’s office of inspector general for financial records to justify more than $500 million in federal grants and tax credits the firms tapped for performing work. The probe seeks to determine whether the companies accurately reported the market value of their costs when applying for federal reimbursement, which was calculated at one-third of the costs.
The solar companies received money through the Treasury’s $13 billion program, known as the 1603 program, which used funds from President Obama’s stimulus initiative to offer cash grants to clean-energy developers. The three companies, SolarCity, SunRun and Sungevity, have been by far the largest recipients among companies installing solar panels on homes.
SolarCity is the most interesting of the names on the list. Its Chairman, Elon Musk, is an Obama supporter who has used taxpayer funds, not once, not twice but three times to enrich himself. Musk has been able to parlay his political donations and lobbyist contracts with the Obama Administration into loan guarantees and grants. Musk spent $480,000 from 2007 to 2011 to lobby Congress, the White House, EPA and DOE and his company Tesla Motors received a $465 million loan guarantee from DOE’s ATVM program. Tesla’s public offering made Musk nearly $600 million. Likewise, Musk’s company SpaceX has a lifeline of government contracts with NASA that total nearly $1 billion.
Musk’s model for enrichment was replicated this past week as the government-funded SolarCity went public. In a sign that while the public’s appetite for “green investment” may be waning, the stock’s initial price was cut in half in order to hit the
Elon Musk, while brilliant, has become a shining example of crony capitalism in the age of Obama. If you put enough money in the Washington, DC political machine, you can walk out with enough government contracts and loans to enrich yourself greatly. It’s a great gig if you can get it but it certainly not what the Founding Fathers had in mind when they founded the country.
Whether the Treasury Department finds that Musk’s company violated the law remains to be seen. What is more troubling, however, his is continued use to taxpayer funds to make himself rich. That, unfortunately, is not only legal in the world of President Obama, but encouraged.