n this country, it is relatively easy to get venture capital for a good idea — and alternative energy has attracted billions in the past few years. What is hard to come by is money to fund the far more expensive process of commercializing the innovation. Andy Grove, the former chief executive of Intel (and still one of the great business minds in America), has been sounding the alarm about this, pointing out that one reason so many American innovations wind up being manufactured in China is that the Chinese are more than happy to finance the commercialization process. One company that has received three federally guaranteed loans, totaling more than $3 billion, is First Solar. That money is going to help the company build three solar power plants in California and Arizona. The plants already have long-term contracts with utilities. They have locked-in cash flows. The risk is minimal.
Shouldn’t banks be making these loans? Sure, but they are still paralyzed by the financial crisis and don’t understand the economics of solar power. Can you really argue that the government should, therefore, also sit on its hands? Indeed, one goal of the loan guarantee program is to show private capital that these loans make sense — so that the banks can eventually step in and replace the government.
The Republicans know all this, surely. In 2005, when the Energy Policy Act was first proposed by the Bush administration, they made some of these same arguments in support of the loan guarantee program, which was part of the bill. The bill passed the House with overwhelming Republican support. Most Democrats voted no.
Today, the Republican-led Energy and Commerce Committee is investigating Solyndra, forcing its executives to take the Fifth Amendment, and releasing embarrassing White House e-mails. I looked it up: every single Republican on that committee who was in office in 2005 voted for the loan guarantee program that they are now so gleefully condemning.
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