Corporate Welfare

George Kaiser 2009: "There's never been more money shoved out of the government's door."


The Tulsa, Oklahoma-based Barack Obama fundraiser and bundler whose investment fund holds  a 39-percent stake in the bankrupt solar panel maker Solyndra stars in a popular new video explaining the logic behind capturing government handouts. 

George Kaiser, who visited the White House repeatedly during the period when the Obama Department of Energy decided to grant Solyndra a half-billion-dollar taxpayer-guaranteed loan, spoke to the Rotary Club of Tulsa on July 8, 2009, highlighting his efforts to bring federal money to local beneficiaries.

You are sanpaku, George Kaiser.

The speech is getting a lot of publicity through headlines like "It's Time to Cash in on the Mother of All Government Handouts" and "We're Trying to Get as Much Stimulus Money as We Possibly Can." In fairness to Kaiser, here is the relevant text – which actually doesn't sound much better: 

The last major initiative is the federal Stimulus package. [Names unclear] are working with us full-time for a while to reflect the fact that there's never been more money shoved out of the government's door in world history and probably never will be again than in the last few months and the next 18 months. And our selfish parochial goal is to get as much of it for Tulsa and Oklahoma as we possibly can. 


So we've helped a number of entities try to make effective grant requests for this funding. We've secured more than $40 million extra for Tulsa so far. We've made multiple trips to Washington to tell the story in education and health care and energy to the respective cabinet secretaries in each of those areas and almost all the key players in the west wing of the White House. So that will be a strong effort going forward. 

We're trying to get Tulsa selected as a pilot project in various programs like Promise Neighborhoods, Race To the Top, innovation initiatives, challenge grants for early childhood education and so forth. And we have the almost unique advantage in that we can say, "Whatever you do we'll match with private funding and we'll watch over it, because we don't want to be embarrassed with the way our money is spent and so we won't make you be embarrassed with the way your money is spent either." 

Doing a bang-up job on that last part, George!

Note that this speech appears to have been a crowd-pleaser. That's the real problem. Another reason I objected yesterday to the criminal investigations of Solyndra is that this is a political issue to its marrow. It's filled with important lessons about ideology, public choice, and the way that parochial self-interest disguises itself as public interest. Kaiser did the country a favor by describing it so bluntly. 

As Princess Amygdala or Princess Amakihi taught us all, liberty dies with thunderous applause. The crime here (in a moral sense, not a legal sense) is not just that politically connected operators do lap dances for bureaucrats and that bureaucrats reward their efforts. It's that this is presented to the public as the system working for all of us. 

In other Solyndra news: 

* Rep. Darrell Issa (R-California), that great Lebanese-American who in 2003 wrote the check Arnold Schwarzenegger cashed, has opened a House Oversight and Government Reform Committee investigation into the practice of making government loans to big political donors, telling C-SPAN, "I want to see when the president and his cronies are picking winners and losers." 

Arnold Schwarzenegger and Chris Gronet: Two more unemployed Californians.

* Speaking of the former Gubernator, Solyndra has turned out to be a gift that keeps on giving for California as well as the nation: 

Last November, an obscure state board agreed to give the Fremont-based company a $34.5 million tax break, the largest one handed out under an alternative-energy subsidy law signed by Gov. Arnold Schwarzenegger.

Schwarzenegger attended Solyndra's groundbreaking in September 2009 and declared it a cause for "great celebration."

Schwarzenegger used the event to push for the tax breaks to help clean technology companies buy equipment for "design, manufacture, production, or assembly" operations in California. He said the subsidies would create new jobs for laid-off auto workers at the shuttered NUMMI plant a few miles away.

"This is why we give these tax incentives," Schwarzenegger said, because "Solyndra will be eligible for these tax incentives for this facility right here."

* Forbes draws the…um…obvious(?) conclusion from this sad tale of government involvement in the free market and misallocation of resources: "Unless private sector and government work closely together in the USA, the manufacture of solar panels will be the next sector to leave the country, probably forever." Which raises the question: What would happen if a door hit a solar panel in the ass on the way out? 

* You may also have seen this chart comparing Solyndra with military "boondoggles." 

If strategic missile defense is such a waste, how come we haven't been hit by any missiles?

The sight gag is that Solyndra is barely a lump compared to the mountains of defense waste, so click here to see the whole chart. We can concede that the F-35 counts as busy work because the era of manned warplanes has ended. Ditto the aircraft carrier and some others. Another advantage of treating Solyndra as a political issue is that it invites a hard look at all manner of public spending, with its attendant waste and corruption. 

But beyond that, the comparison does not hold. Nobody pretends defense spending is about creating jobs, reviving the economy, or creating free-market products. Mayors of towns near military bases may come to believe the first and third items, and idiots like Paul Krugman may delude themselves into believing the second. But defense spending is about building the capacity to destroy the warfighting capacity of real or potential enemies. Mission creep doesn't change the fact that establishing a military is a specifically constitutional and widely recognized role of government. The Constitution is silent on solar panels. 

NEXT: Eric Holder: Now That Obama's up for Reelection, We're Seriously Going to Close Gitmo

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  1. It’s for men like Kaiser that “tar and feathering” should be brought back as a punishment.

  2. Close the door, government! Were you born in a barn?

    1. Gotta keep it open. That’s how crony socialism works.

    2. “What, were you raised in a barn? Shut the door! Probably was raised in a barn, along with the other primitives.”

      1. “Are all men from the future loud-mouthed braggarts?”

        1. “Nope. Just me, baby. Just me.”

  3. …..idiots like Paul Krugman


  4. “The Constitution is silent on solar panels.”

    But…but…General Welfare. Ta da!

    1. Commerce Clause – the sun shines across state lines.

      1. Solar power is necessary and proper for the federal government to carry out its constitutionally allowed powers. This is fun!

    2. Actually, I could justify some spending on solar panels as a defense expenditure. Our dependence on oil leads us into foreign wars, and if solar power could significantly reduce our need for foreign oil, it would also reduce our need for foreign wars.

      That said, I’m thinking in terms of $5m pilot projects, not $500m handouts to friends. The larger price tag might be justifiable with a proven technology – but it had damn well better be proven. Of course, in that case they wouldn’t need government intervention – so best to stick with an occasional pilot project.

  5. But beyond that, the comparison does not hold. Nobody pretends defense spending is about creating jobs, reviving the economy, or creating free-market products.

    I’ll give you the last one, but the first two…

    1. I won’t even give him the last one. The internet, tang, teflon, etc. all get used as justification for evermore defense spending.

    2. Well, nobody wise pretends it’s about those things. Economic fools abound, however, as Krugman and the many buffoons who worship him regularly remind us with their retarded comments.

      Bastiat, who gave us that brilliant parable about the broken glass fallacy, applied his lesson to military spending as well; he made clear that while military spending is indeed justified by a country’s need to keep itself alert and ready to defend itself against all threats, it is not justified by any need to keep people employed. Using the military as another welfare institution wastes labor and resources that could have been spent elsewhere more productively.

      The military’s proper function is, in fact, a lot like a garbage disposal company’s: to dispose of harmful waste. In the military’s case, the harmful waste consists of all the enemy scum domestic and foreign who are trying to do harm to our country and its citizens. While we do have a fair number of enemies just as we do generate a substantial amount of garbage, the number of soldiers necessary to dispose of our enemies is finite, just like the number of garbage men needed to dispose of the garbage. Hiring more military just to give more guys a job would be like hiring more garbage men than we really need, and just as wasteful.

  6. Is George Kaiser that guy who does the commercials about getting gubmint money? The one who wears the coat with dollar signs all over it? I swear he looks like that guy. He sure as hell says the same things.

    1. He looks like Steve-O’s dad.

    2. Do they still air those commercials? I haven’t seen one in forever. Then again, I haven’t spent a lot of time watching TV for the past seven years or so, either…

    3. No, that’s Matthew Lesko. Also, he dresses in a suit with question marks all over it like the Riddler, not dollar signs.

  7. we don’t want to be embarrassed with the way our money is spent

    He must be using the Oscar Wilde definition of “embarrassed”.

  8. That graph and Joe Romm’s blog post piss me off, but I can’t really refute their point, since he didn’t really make one. So should we spend less on Littoral Combat Ships so we have more to spare to keep Solyndra afloat? Oh well, at least the ship is pretty darn cool looking.

    1. I still think the squash court at the stern was over the top.

      1. That’s clearly a pickleball court, you retard.

        1. You Homo.

          1. Only dopes play the shittiest racquet sport of them all, you jerk. A racquet sport with a ball that doesn’t bounce?

    2. So should we spend less on Littoral Combat Ships so we have more to spare to keep Solyndra afloat?

      What say we do neither.

      ps: fuck Joe Romm

    3. Not only does the graph not make a point (except that having the best military is expensive), but it’s misleading. Many of those expenditures did produce results of one form or another. E.g.: ballistic missile defense spending helped bring down the USSR and produced some systems; the FCS had some results that were folded into later programs, etc.

      1. Uh, I don’t think arguing in favor of spinoff benefits from military spending is really the point we want to make.

  9. The Constitution is silent on solar panels.

    Well, the Commerce Clause empowers Congress to regulate trade with the Indian Tribes, many of whom to some degree or another worshiped the sun.

    So there.

  10. [Names unclear] are working with us full-time for a while to reflect the fact that there’s never been more money shoved out of the government’s door in world history . . .

    How convenient.

    1. [Names unclear] are working with us full-time for a while to reflect the fact that there’s never been more money shoved out of the government’s door picked out of the taxpayers pocket in world history . . .

      There, fixed it.

  11. The sight gag is that Solyndra is barely a lump compared to the mountains of defense waste

    Only because Solyndra didn’t have several decades to perfect the practice.

    And the Great Misdirection here, in addition, is that ThinkProgress would prefer to simply shift the wasted money to their own wasteful projects, instead of simply not spending the money in the first place.

    1. The ThinkProgress approach should work like a charm for beleaguered spouses. “Whaddya mean, I wasted hundreds of dollars at the track? You shouldn’t care about that, because I threw away THOUSANDS in Vegas the other week!”

  12. If the economy tanks even further, this next election is gonna be interesting.

    1. If the economy tanks even further, this next election is gonna be interesting.

      It will…..and It will.

  13. Anyone know how much Kaiser will lose in the bankruptcy? If zero, then he belongs in jail. If something, then perhaps he too was foolish enough to believe in a positivefinancial return on the type of solar panels they were making.

    1. I read somewhere his stake and the govt stimulus were structured so that senior special creditors like him would be made whole before taxpayers were repaid. Seriously. I’d link if I could find it.

      1. Yep, he has a special deal to get paid out before the DOE.…..-next-move

        Dunno if he’ll come out ahead, but this is a very special deal. Ordinarily, the government insists on being the senior creditor in any deal it helps fund. The kind of special deal that doesn’t get made unless you have special friends.

        As things currently stand, Argonaut (Kaiser’s company) stands to get the entire business for a fraction of its worth, and the DOE will get absolutely nothing.

        1. Sounds like someone knows where Rahm buries the dead tranny hookers for Barry.

    2. Yeah, he’s the senior creditor after the loan restructuring in February. Plus, the Solyndra BK plan calls for his Argonaut Ventures to become the debtor in possession; if the company isn’t sold 30 days after a judge approves the plan, he literally gets everything.

  14. REPORT: SOLYNDRA execs to plead the Fifth…

    Sept 20 (Reuters) – Solyndra LLC’s chief executive and chief financial officer will invoke their Fifth Amendment rights and decline to answer any questions put to them at a Congressional hearing on Friday, according to letters from their attorneys obtained by Reuters.
    In the letters sent to the House Energy and Commerce Committee’s Subcommittee on Oversight and Investigations, attorneys for Solyndra CEO Brian Harrison and CFO W. G. Stover said they advised their clients not to provide testimony during the hearings.

    The bankrupt company’s $535 million federal loan guarantee is being investigated by the House Energy and Commerce Committee.

    Harrison is represented by Orrick, Herrington & Sutcliffe and Stover is represented by Keker & Van Nest.

    Solyndra’s offices were raided by the FBI two days after the company filed for bankruptcy, although the FBI did not say what prompted the raid.…..KE20110920

  15. Dude, it’s Princess AMIDALA. The “amygdala” is a part of the brain.”

    1. Yeah, but is it an RC’z Law case?

  16. it contains many value in urban and western culture.

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