Email ties Solyndra scandal directly to White House

**Posted by Phineas

Obama’s Chief Investment Adviser

If former White House Chief of Staff Bill Daley knew about Solyndra’s financial troubles, and yet the DoE still went ahead with restructuring the loan to illegally subordinate taxpayers in the event of default, what are the odds Barack Obama didn’t know?

Buried in the treasure trove of White House emails related to Solyndra released Thursday by the House Energy and Commerce Committee is one suggesting that concerns about Solyndra’s viability were shared all the way up to then-White House Chief of Staff Bill Daley a full six months before the company went bust.

(…)

As Solyndra began sinking for good last August, [OMB analyst Kelly] Colyar sent an email summarizing the events leading to a near total taxpayers loss of the $535 loan.

“You may recall that DOE announced in March that they had restructured the Solyndra loan,” Colyar writes. “Prior to this restructuring, OMB staff expressed reservations about the prospects of the company and DOE’s proposal.”

And here’s the key line: “The issue was discussed with the NEC and the Chief of Staff.”

In the end, of course, the loan restructuring went through anyway and, Colyar writes, “Unfortunately, the scenario which OMB staff had feared has materialized.”

That “unfortunate situation”, of course, was a bankruptcy that left taxpayers unable to recoup almost all of $535 million loan blown by Solyndra.

Sure, Daley and the National Economic Council signed off on the loan restructuring without consulting their boss. Uh-huh. Would you care to buy this lovely bridge, too?

Ed Morrissey calls it a bombshell:

This, however, is much more serious. This is the first time Obama’s inner circle has been tied to the restructuring and its illegal subordination of those taxpayer loans. If Daley was briefed on the details of that restructuring before it got put in place and it still went forward, one can infer that Daley didn’t raise any objections to it. It’s hard to imagine that Daley would have gone out on that limb without getting approval from the man to whom he directly reported — Barack Obama.

I think it’s time the Energy & Commerce Committee called Mr. Daley in for some testimony under oath, don’t you? Not only should the federal government not have ever been playing the role of venture capitalist, a role it’s lousy at, but its failure to write off Solyndra at an earlier stage, when Colyar first warned about it, cost the taxpayers an additional $394 million. And it broke the law by putting taxpayers behind outside investors –including an Obama bundler– for claims on assets in case of a bankruptcy. Which is just what happened.

Remember what Obama said a few weeks ago? “We tried our plan, and it worked!”

Heckuva job, Barry.

RELATED: Earlier posts on Solyndra.

(Crossposted at Public Secrets)