Just when you thought that the loss to the taxpayer on this boondoggle was done at the $535 Million Green Energy loan we find out that it could get worse, $360 Million tax dollars worse. And this is playing out right here in Delaware at the bankruptcy court.
It seems that an investor in Solyndra is positioning himself to end up with ownership of the company which is just a shell since the hard assets are already gone. Energy subordinated our Half Billion to his $75 Million investment. He is trying to arrange it so that the company is reorganized without its debt because it is worth about $900 Million in tax losses and $12 Million in solar credits.
If he can pull this off, he will merge the shell with one of his companies that has profits and pocket about $360 Million of tax savings courtesy of the US taxpayer.
IRS is opposing this plan saying that the “principal purpose is tax avoidance.”
This is laid out in better detail in an editorial in today’s Wall Street Journal and they even point out something about who this investor is. It is even worse when you see the details. By the way, A123 who was supposed to make batteries for Fisker went bankrupt today as well with $249 Million in taxpayer money. Here is a GOP article with links to the WSJ.
I have been asked many times when discussing these scams such as Bloom, Solyndra, Fisker, Bluewater and the like if I really think that these companies want to fail. The best illustration that I give is from the first scene of “The Producers” when the accountant makes the observation to the crooked Broadway producer that if you set everything up just right that you can make more money with a flop than with a hit. Someone must be doing seminars.
It’s more of the scene in Wall Street when there is more money in pensions then product. It’s the same philosophy behind a small market sports team who claim losses at the gate but make millions in other revenue streams. Why pay for the product on the field when you can make more with merchandising, parking, PSL, etc.