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Solar Company Folds After $0.5B In Subsidies
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."
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? I know what you think but let me play an evil's advocate for a second. How much the fresh air is worth to you? To your children? To your children's children? To your children's children's grandchildren? Well, you get the idea. And what about fresh water? What about cold weather? I am not saying that all of those things should be worth more than 500 billion to everyone but I suggest that we have to account for them in the business plans of companies developing green technology. 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.
Karma: Positive (probably because of superiour intellect)
Led, of course, by Salon's Andrew Leonard, 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.
Dog is my co-pilot.
The market will not necessarily support what is good for society, it will only support what is profitable. This company was even given a head start by the government and still couldn't make it. It's very unfortunate that the destructive libertarian argument that the government should stop spending money and let the private sector work it out seemingly has so much traction.
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.
Two of my imaginary friends reproduced once
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
Everybody gets what the majority deserves.
Actually, no.
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.
The good and new comes from no quarter where it is looked for, and is always something different from what is expected.
And this is a prime example of why government subsidies of production are a bad idea. I haven't firmly settled on a position with regards to federal funding for R&D (although certain examples, like sick shrimp running on treadmills, should be an obvious choice for budget cuts...), but trying to force adoption through subsidies only distorts the market, without adding any value.
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.
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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/
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?
Put my fist through my alarm clock with its ding-dong death inside my ear. - The Blackjacks.
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.
"Flyin' in just a sweet place,
Never been known to fail..."
First:A $535 Million loan guarantee is not the same as a subsidy....so.....maybe these articles need to be vetted a little better. Second: “Solyndra could not achieve full-scale operations rapidly enough to compete in the near term with the resources of larger foreign manufacturers,” - DUH!! And this will continue happening as long as the US is not China.... ....so instead....we should CREATE NEW TECHNOLOGY and license it for manufacture to other countries....welcome to International Business 101
Individuals must choose, decide their "essential" nature rather than having it given from some transcendent source.
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.
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.
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.