How many more scandals does the green energy industry need to create before politicians realize it is a terrible bet? Perhaps they don’t want to know because they can get their grubby hands on tax money.
Last week, Mississippi requested that GreenTech Automotive, an electric car company started by Governor Terry McAuliffe (D-VA), to pay back the state government roughly $6.4 million after the business failed to uphold its mission: create jobs in The Magnolia State.
According to the Richmond Times-Dispatch, State Auditor Stacey Pickering is calling for GreenTech Automotive to repay Mississippi $5 million worth of taxpayer-funded loans, plus interest. Writing in a letter to current CEO Charles Wang, Pickering demanded repayment within thirty days because the firm did not create adequate jobs in the state and eventually closed its factory in Tunica County in January.
Pickering told the newspaper that his office had a difficult time trying to initiate an audit of GreenTech, noting that the enterprise’s behavior “raised red flags.” It may result in a formal investigation, and Gov. McAuliffe may be included in such a probe if the state decided to move ahead with one:
We’ve never had a company force our hand at this level.
When it comes to these recoveries, naturally the corporation is the first entity, then we will take a look at what other legal avenues are available when it comes to the officers of the corporation. If it results from the time he was involved in the corporation, those will be issues that we’ll be addressing at that time.
Although this is further proof that green energy companies should not be subsidized by the taxpayers, the real scandal may be the big name involved: Terry McAuliffe.
McAuliffe is the former chairman of the Democratic National Committee (DNC) and co-chairman of Hillary Clinton’s 2008 presidential campaign. He sought the Virginia governorship in 2009, but lost the Democratic nomination to State Senator Creigh Deeds.
During his brief political hiatus, McAuliffe purchased a Chinese business and relocated it to the U.S. in an attempt to prove to Virginians how much of a businessman he really is. In 2012, GreenTech hosted a ribbon-cutting ceremony in Mississippi, which had some high-profile guests, including former President Bill Clinton and former Governor Haley Barbour (R-MS).
A year later, McAuliffe ran for the Governor’s Mansion and won by more than 2% over his Republican opponent, Ken Cuccinelli. Reports now suggest that McAuliffe is a heavy favorite to throw his hat in the 2020 Democratic presidential race, despite the many controversies that have dogged his career.
In 1996, he was investigated by the Senate committee for campaign-finance violations. In 2002, McAuliffe was probed in a political profiteering case in which he turned a $100,000 investment in Global Crossings, a telecommunications juggernaut, into an $18 million profit. In 2013, Judicial Watch added McAuliffe’s name to its most corrupt politicians list.
The Washington watchdog organization now accuses the media of keeping McAuliffe’s name out of the GreenTech scandal. The organization cited the Washington Post as an example, observing to World Net Daily that the newspaper only listed McAuliffe once at the very end of the wire-service article:
How convenient! The article omits that, as GreenTech founder, McAuliffe brokered the deal in which the company got millions in public funds by promising to invest $60 million locally and creating hundreds of new fulltime jobs.
That never happened, and instead taxpayers got fleeced.
McAuliffe’s handlers are already dismissing any notions that he had anything to do with GreenTech since exiting the firm, the Richmond newspaper reports:
McAuliffe’s office has said the governor has had no involvement with the company since stepping down as its chairman and divesting his financial stake. But the escalating standoff in Mississippi raises the likelihood that the business deal McAuliffe brokered could be headed toward a bitter end in court. Ending his four-year term as governor with a higher national profile and record as an exuberant pitchman for Virginia, GreenTech’s unraveling could dog McAuliffe amid speculation about a 2020 presidential bid.
Green energy has been a popular pet project for politicians across the country, using taxpayer dollars to lavishly fund these startups and small businesses. But there are always a couple of patterns in the industry: green energy firms are well-connected with policymakers and these companies shut down, blowing the tax subsidies.
The Heritage Foundation published an interesting study in 2012, highlighting that U.S. taxpayers were on the hook for $2.6 billion in bankrupt green energy companies. Since these businesses could not attract private investment, they turned to taxpayers for their funding through the means of loans, tax credits, grants and loan guarantees.
Everyone probably remembers Solyndra, the solar panel firm that was taxpayer-supported by about $535 million, and heavily promoted by the Obama administration in 2009 as part of the president’s economic stimulus package. A couple of years after receiving the money, Solyndra filed for bankruptcy – to this date, more facts keep coming out, including that officials from Office of Management and Budget (OMB) said they were pressured to approve the loan, despite the company’s financial uncertainty.
Set aside the fact that there always seems to be some crony affair occurring with these deals, it must be pointed out that the government is not an infrastructure psychic. Politicians, no matter what letter comes after their name on television, are unable to predict the future – many of them can’t even put together a budget! They shouldn’t be in the business of risking your money.
Perhaps the Trump administration will scale back multi-billion-dollar checks to the well-connected, but that won’t stop states from handing over taxpayer dollars to these cronyist companies. You will always find a governor’s nephew’s wife who is an executive at a green energy firm and wants a helping hand from the state. But nepotism mustn’t be the driver of energy policy.
With the media fully behind government-supported green energy and journalists fervently opposed to President Donald Trump, it is quite likely that Gov. McAuliffe will be unscathed by this story should he run in 2020. That is, if Hillary Clinton doesn’t decide to throw her hat in the race in three years – if she does, all bets are off.