Solar Company Folds After $0.5B In Subsidies 694
First time accepted submitter dusanv writes "Solyndra, a Silicon Valley solar energy firm, subsidized to the tune of $500 million and held as a 'gleaming example of green technology,' announced bankruptcy yesterday. 1,100 employees fired."
Stop (Score:5, Insightful)
Re:Stop (Score:5, Insightful)
Before anyone jumps to the conclusion that green technology is not profitable and therefore a big scam, or a modern religion if you will, with all of its guilt, shame and asking for money, let me state an opinion that might not be popular here: Maybe, just maybe, the subsidies was too low?
Ah, yes. We can make 'green technology' profitable by simply... taking more money from taxpayers and giving it to them.
That'll work.
The apologists are already coming out (Score:5, Insightful)
Led, of course, by Salon's Andrew Leonard [salon.com], for whom no amount of subsidy is ever enough, and no amount of state intervention can possibly suffice. The reality is far different, of course, and starts with the lousy energy density of solar; but we are dealing with a very heavily government-controlled "market" that is steadily eroding as subsidies decline. The myth of green jobs is something like promising to feed people with tasty barbecued unicorn ribs [the-americ...terest.com].
This is the flaw with libertarian arguments (Score:1, Insightful)
Extra, extra! (Score:5, Insightful)
An experimental business in an emergent technology fails to establish itself in a collapsing economy. Read all about it...
Give me a break folks, them and a whole bunch of other companies both old and new... Stop trying to make.
Re:Stop (Score:5, Insightful)
It is what we do with every other energy source. Name one large commercially used energy source that does not get subsidies, tax breaks, government backed loans or liability protection of some form.
Re:Stop (Score:5, Insightful)
No, what the guy SHOULD be saying, is that non-green technologies are a lot less CHEAP when you factor in the real cost of environmental degradation, negative health effects, non-renewable resource use, etc. in properly, which the MARKET does not do correctly. A Government subsidy is one way of correcting this market failure.
Or do you think it's just fine that strip-mining coal leads to destroyed lands, which then cannot store water and cause flooding onto people's towns, and also produce acid rain, widespread mercury poisoning, air pollution, climate change, NONE of the costs of which are factored into the price of coal? That's A-OK?
If that's NOT OK, how do you fix it? One way is to subsidize green tech. Another is to tax coal or whatever according to the true cost of their activities. Which do you think is more realistic politically?
What we should do is do the math and figure out how much of a subsidy is really justified, THEN talk.
--PM
You can't legislate success. (Score:2, Insightful)
Dear Princess Obama:
Today I learned that you can't use legislation to force technology or change principles of chemistry and physics, no matter how heavy the subsidy, or from whom the subsidy money is coerced, or how many people who didn't vote for you which you blame. I also learned that economic practicality will trump blind idealism every time, as one is grounded in reality and the other in denial of reality. When a technology is ready and feasible, marketplace forces will ensure its rapid adoption if it is, in fact, superior as claimed. However, no matter how good the intent, a technology that is not ready cannot be forced upon the public.
Your faithful tax-sucking green-liberal Pollyanna,
Solyndra Sparkle
Re:The apologists are already coming out (Score:3, Insightful)
Canard.
When you invest, you diversify, because no matter what, some of your investments will turn out to be failures.
The government is also invested in the companies that put this one out of business.
It's hilarious to see Republicans pretending they don't understand how business works.
Re:China (Score:4, Insightful)
China's solar companies are doing well because they get *tremendous* subsidies, as is always the case for nascent, high tech industry.
if it weren't for massive government subsidies - paying for R&D costs directly, and providing a huge protected market mainly through the defense department - then the computer revolution which drove the 1990s boom WOULD NOT HAVE HAPPENED.
All you free market fantasists need to get that into your thick skulls - or, you could go love on Ayn Rand's island! Please do, so that we can run our country like sane people. In 10 years, when solar power is viable, it will be the Chinese who are reaping the benefits because free market fanatics in the US aren't willing to make the basic investments required.
Funding production != funding development (Score:5, Insightful)
In this case, the US Government effectively forced every US citizen to invest $1.60 in a company that had never been profitable and showed no prospects for profitability. The investment was not for development of technology that would make solar power economically viable, but rather it was for purchasing capital equipment for existing, uneconomic technology. The results were perfectly predictable. If no private investors see the value in the company, we should be thinking awful hard about whether it's a good idea to force them to invest in it anyway.
I would love to see solar power prove profitable, but such a goal will come as a result of research and development, not as a result of government subsidies for production of inefficient technology.
Re:The apologists are already coming out (Score:5, Insightful)
Was this seen as coming? (Score:4, Insightful)
Reading through the Solyndra web site, there's the following announcement of the departure of their Founder and CEO
http://www.solyndra.com/2011/08/chris-gronet-takes-on-advisory-role-for-solyndra/ [solyndra.com]
from August 18th, about 2 weeks ago. Coincidence? Founder / CEOs don't normally leave after the first 5 years of a startup. Is there more to the bankruptcy story than what's in the OP's article?
Re:Stop (Score:5, Insightful)
And what of the thievery implicit in the pollution of our air, water, and land for over a century by companies who care of nothing but profit? They stole something which we all have an inherent right to enjoy. Now that some people want to tax the polluters, to pay for what they've already taken, people start crying about thievery. The hypocrisy is disgusting.
Re:Stop (Score:5, Insightful)
Maybe, just maybe, the subsidies was too low?
Well, that wasn't my first thought. My first thought was that if they couldn't make a go of it with five hundred million dollars of subsidies then there would be no way they could make a go of it on a level playing field. It wasn't my second thought either. My second thought was that our government is surely incapable of picking winners. Similarly, with the third. My third thought was that I sold some scrap aluminum yesterday. It appears to me that they're able to make a go of it without subsidies. Maybe scrap aluminum isn't green? Nope, it's pretty green compared with smelting bauxite. Maybe it's an unfair comparison? Nope, manufacture of solar cells produces lots of waste.
How much the fresh air is worth to you?
Well, I've got plenty right now. I suppose I could use some more, though. I might be willing to pay a penny for a cubic mile. How much do you have?
To your children?
They are in the same boat as I am.
To your children's children?
They don't have any, so they wouldn't want any. But perhaps you're speaking metaphorically? Let's see...air is cleaner now than it was fifty years ago. Presumably, there will be more clean air when the grand kids come around. I don't know? Penny for a thousand cubic miles?
And what about fresh water?
Yeah, we're pretty well set for fresh water, too. I don't know...maybe if I had more fresh water I could water the lawn. What's the going rate? Let me buy one lawn worth of fresh water. But I'm not willing to pay the going rate! If I were then I would have watered it already. How about you give me a ninety percent discount?
What about cold weather?
I wouldn't give you a plugged nickle for all the cold weather in Antarctica.
I am not saying that all of those things should be worth more than 500 billion to everyone
That brings up a good point. Why is the government taking 500 billion from everyone if it's not worth that to everyone. (I think it was actually 500 million in this one case, but I didn't want to misquote you.)
We have to ask ourselves: Why do we develop green technology? How much money are we willing to waste? What sacrifices are we willing to make? What do we expect to get in return? Those are the most important questions that we should at least try to answer.
I'm afraid you've missed some of the more important ones. Will it give me a good photo opportunity? Will it get me enough votes to get me reelected? Will this come back to bite me before I retire?
~Loyal
Someone (Score:4, Insightful)
Made out like a bandit.
There's a rich man or two, after this "Solyndra" scam was used by insiders to funnel 500Mil. Mark my words.
You live in a Kleptocracy. The "foreign competitiveness" front sound very plausible. That's why the whole "green technology boondoggle/buble exists. Not that it might not be needed - but any affair involving billionaires will be used for private extraction. We live in the "post-economic" era, where the pretense of an economy is used to commit outrageous crimes.
2 things (Score:3, Insightful)
Re:This is the flaw with libertarian arguments (Score:5, Insightful)
Even though this company was given a substantial advantage in the free market (some might say an unfair advantage), it was rejected. Other green companies were able to produce better results with fewer resources, and produced products at lower costs to consumers. The free market directed its support to those better, cheaper alternatives, effectively killing the company in the article. But to you that rejection is evidence that people are too stupid to buy what you think they should buy. Therefore the free market system failed, governement should fully finance companies like the one from the article and require the populace to consume it's products, while giving consumers no chance to support the better, cheaper alternatives....
Yeah, that's a very compelling argument against libertarianism and the free market....
Re:Solar dies, RADIATION LIVES. (Score:2, Insightful)
It also proves that the government does a lousy job of picking economic winners and losers. That is a game the government should stay out of.
Everybody does a lousy job of picking winners and losers. Some VCs try to make sure they pick winners, other VCs spread there money out more trying to pic a winner. I worked at a company that was funded by the same VC that funded Blackboard, Inc. We took $6 million and failed. A lot of companies in their portfolio took similar ammounts and failed. Blackboard IPO'd for $billion or something. When that strategy works, it still averages out to a good yield when you lump the winners with the losers. Also, most losers aren't 100%. If you can take a 30% loss on 10 companies and a 100 fold return on no. 11, you're golden.
Now that that's out of the way, the 2nd part of your statement becomes a question of whether or not the government should act as a VC. That's a separate issue. It's open to debate. If the government doesn't fund startups, then should it do anything else to help business? If you want to be a purist on this you need to strip out *all* the incentives, not just assistance for startups.
Re:No - maybe (Score:5, Insightful)
The best argument I've ever heard against subsidies for Green technology was from a VC in Silicon Valley and the interview was in Scientific American a few months ago - and I can't find the damn article.
One thing that made this nation great in its heyday was this: We didn't have a bunch of hand wringers from libertarian think tanks getting in the way of progress. If we had, this country would never have achieved anything that couldn't safely return a profit within the next two quarters.
When there was a major goal to accomplish, government and industry got together and put together the taxpayer funded handouts it took to do the job. Whether it was gifting free land to railroads, building canals in Central America, providing major subsidies for air mail, creating massive socialist highway building programs to help auto makers, or hundreds of other things., they stepped up to the plate and said: Git 'er Done.
Re:Stop (Score:3, Insightful)
s/green technology/fossil fuel companies/
============
are you aware that, compared to this relative pittance of $0.5B, the US government subsidizes the fossil fuel industries to the tune of upwards of $700B ... per YEAR?
how profitable would those companies be without taking THAT money from taxpayers and giving it to them?
what about if we stopped spending ($3.5Trillion+ / 10 years) for the war machine to provide us first-in-line status at the MidEast Gas Pump?
does your invisible-hand-of-the-almighty-free-market ideology apply equally to all comers, or just those new corps that pollute less and aren't owned by already-rich guys with CongressCritters in their pockets?
Re:Stop (Score:5, Insightful)
So, where do you think all that Rare Earth Metals and stuff the solar panels comes from? Where do you think the energy to make them comes from? Unicorns and Leprechauns?
Re:The apologists are already coming out (Score:4, Insightful)
Re:Stop (Score:4, Insightful)
Is your position then that he should go on being complicit instead of say, recognizing the errors of the western world and trying to make amends by advocating a contrary position on the internet?
But I am sure if he did that some pro corporate internet prick would come along and accuse him of being a hypocrite for *implicitly* supporting the destruction of the environment, tens or hundreds of years before he happened to be born in the same region.
You really have his number all right! we should all just sit back let corporations ruin the environment, because hey, we are using computers and computers are um.. made from the environment? How dare he voice his concerns using tools developed with modern technology! He should be screaming out the windows like I am! Hey who let that bird in here?!?
See it makes sense! Everyone is responsible so you should feel bad, keep it to yourself and do nothing! thats the sure way to a better world!
Re:No - maybe (Score:3, Insightful)
No, I mean pollute LESS, like I said. Oil is a very nasty business in both extraction AND use. At least solar is only messy in producing the panels, not in use (and really not messy at all when you use solar HEATING, not photovoltaic). And to say it pollutes DIFFERENTLY, is to imply they are equal pollution-wise. Finally, I hope your Chernobyl comment was sarcasm, as the only thing beneficial to the flora and fauna was that it kept people away.
Re:Stop (Score:2, Insightful)
Well, I've got plenty right now. I suppose I could use some more, though. I might be willing to pay a penny for a cubic mile. How much do you have?
Spoken like someone who doesn't live downwind of a coal-fired power plant.
I'll tell you how much clean air I've got: roughly 142 billion cubic miles of atmosphere on our planet, depending on your definition of "clean" and assuming you're willing to push the definition of "atmosphere" all the way up to 620 miles. You put the current value of the entirety of Earth's atmosphere at $1.4 billion dollars? And you figure your children will value the entire atmosphere at $1.4 million dollars?
Of course talking about the atmosphere in terms of volume is a little strange because the density varies so much. Say we want to talk about *useful* atmosphere up to about 50,000 feet or so (I'm feeling generous). In that case I've got about 1 billion cubic miles to sell you, which you value at $10 million dollars right now or at $10 thousand dollars (!) in the future.
Yeah, that's the thing about stuff like "clean air": it seems like it's infinite and free . . . until it's not and it's gone. Then it costs a hell of a lot more fix it than it would have to save it in the first place.
I agree that things like subsidies aren't straightforward, and no, I'm not excited about wealth transfers either. But our fossil-fuel energy sources have *huge* problems with externalized costs that aren't being paid by the people consuming the energy, and that's a problem that needs to be addressed in one way or another.
Yes, air quality is generally better now than it was 50 years ago (in first-world countries, anyway), but that didn't happen magically or accidentally. That happened almost entirely due to the sort of government regulations and policies that conservatives and libertarians deride (not to make assumptions about your political leanings). It sure as hell didn't happen out of the goodness of any corporation's heart - pollution is an external cost, remember?