Government Subsidizes and Bankrupts CompaniesJames Hall But the fact that potential buyers are from China is already raising alarms about Fisker, which raised $1.2 billion in venture capital and spent about $192 million in federal loans to build a factory. Technology developed with American taxpayer subsidies should not be sold off to China, Republican senator Charles Grassley told Bloomberg. He compared it to the acquisition of A123 Systems by China-based auto parts company Wanxiang Group. By contrast, Tesla Motors, which also received a DOE loan to build its factory, is crossing into higher volume production. Yesterday, Tesla announced that it expects to be profitable this quarter and is making its Model S at a rate of 400 a month, which will allow it to hit its annual target and meet demand for the electric sedan. (See, Teslas Explosive Revenue Suggests a Bright Future.) One crucial difference between Tesla and Fisker, which is well known for its bold designs, has been Teslas manufacturing expertise. Fisker may well still go public and be a successful EV supplier. But for energy-related startups to go the route of Tesla rather than Fisker, theyll need innovative technology, access to capital, supportive policies, and great business execution. Henry Ford is rolling in his grave and Enzo Ferrari is searching for the electric switch. The notorious Green sector has vivid examples of bribery, theft, incompetence and high-priced inefficient technology. The Foundry publishes a most informative list ofPresident Obamas Taxpayer-Backed Green Energy Failures. So far, 34 companies that were offered federal support from taxpayers are faltering either having gone bankrupt or laying off workers or heading for bankruptcy. Examine the specific site links for expanded details. Last year, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union refused to accept concessions that would have kept Hostess in business. The company had tried to cut costs as it faced high labor expenses, rising ingredient costs, and decreasing sales. The Teamsters union accepted the concessions, but the Bakery union would not, choosing to strike. Unable to continue operating, Hostess filed for bankruptcy. Now those who helped bring down an American icon will receive generous, taxpayer-funded benefits from the Trade Adjustment Assistance (TAA) program. These generous benefits come in addition to existing unemployment insurance, job placement, and job training programs. TAA benefits include: Up to two years of job training in an approved training program, Up to 52 weeks of Trade Readjustment Allowances for workers in job training, Job search and relocation allowances, A refundable health care tax credit that covers 65 percent of a workers health insurance premiums in qualifying health plans, and A two-year wage insurance program that partly replaces workers earnings if they accept lower-paying jobs. The civic grant philosophy is not just for corporatists. Union goons prefer that their rank and file lose their livelihood, so that they can enjoy the welfare stipends of the state-run insolvent society. The prospects of a Mandarin logo on a Fisker vehicle are hardly on the same scale of transferring innovative technology to Cantonese creditors. However, the common practice of squandering national treasure for dubious purposes seems to be the primary product of the political careerists. Hostess Brands is classic case of private equity engineers and executives looting a viable company, loading it up with debt, and then asking the employees to make up the difference. Regretfully, but with no remorse; the political class plays the role of private equity engineers, as the government plunders our economy, through crony spending and swelling of the debt, while saddling the taxpayer with the bill. James Hall is a reformed, former political operative. This pundits formal instruction in History, Philosophy and Political Science served as training for activism, on the staff of several politicians and in many campaigns. A believer in authentic Public Service, independent business interests were pursued in the private sector. Speculation in markets, and international business investments, allowed for extensive travel and a world view for commerce. Hall is the publisher of BREAKING ALL THE RULES. Contact batr@batr.org linkwithin_text=Related Articles: 