Sunday, October 23, 2011

Obama Spent A $Billion To Lose -- Not Gain -- 1100 Jobs

This week's "green jobs" scandal for the Obama Administration is all about a $529 million loan to a start-up electric car company, Fisker, who took that money and then decided to build their new Karma automobile in Finland. Prior to this, there was the Solyndra scandal who, when given a similar amount of money, spent like there was no tomorrow; first class on everything. Ultimately, they closed their doors and 1100 people lost their jobs. So, our "net" in an investment of over a billion dollars: A loss of 1100 jobs in America and a gain of 500 manufacturing jobs in Finland.

Both these debacles fall under the purview of Obama's Energy Secretary Steven Chu. And, my guess is that this won't be the end of these kinds of screw ups. That's because you can see a trend in Chu's inability to understand the business plans and potential marketplace of the products of these two companies.

Take for example, the lack of thought that went into the Fisker loan. First, its a $90,000 automobile that only has an expected annual sales goal of 15,000 units worldwide. Its target is the super rich. Is that the best use of a half-billion dollars in taxpayer money? Worse yet, it is an automotive styling showpiece (And that's all it is!) which is no engineering marvel. It only has an all-electric range of 35 miles; after which, it runs on gasoline and only gets around 20 miles to the gallon. The Fisker website states that the Karma is "Pure Driving Passion" and goes on to say that it will be distributed by a "network of retailers...handpicked to give owners unparalleled service while making them part of an exclusive club". Not hardly a "people's car" that is designed to save the planet. For that reason, alone, the government should never have funded this company. But, it did anyway; leaving the only reason for the loan: Crony Capitalism due to pressure from political donors.

The bottom line is that the Obama Administration, through its ineptness, has thrown away more than $1 billion in taxpayer money. If either of these companies were proven to be good investments, the corporate community, now sitting on nearly $2 trillion, or some venture capitalist would have been more than happy to give them the needed seed money. Instead, both companies failed to find adequate private sector funding and wound up suckering the Obama Administration for the cash. Believe me, if this had been anything other than a Democrat Administration, the media would be calling for heads to roll.

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