As NLPC has covered Fisker Automotive’s catastrophic flop over the last few years since it was granted a $529-million taxpayer-guaranteed loan from the Department of Energy, one big question that repeatedly came up was: How could a company that produced only one electric car model burn through $1.4 billion in investment so quickly?
Reuters uncovered a number of reasons in a report published earlier this week. Citing documents and some sources, mostly anonymous, the news syndicate painted a disturbing picture of mismanagement, incompetence, disinformation, and squander. While businesses stumble and go out of business every day, Fisker’s case illustrates why government bureaucrats are only accidental successes as investors of public money at best, but often are horrific decision makers at worst.
“Fisker’s undoing had numerous causes,” Reuters reported. “Fundamentally, say suppliers and some insiders, executives simply couldn’t orchestrate the complex dance that leads from a design sketch to the … Read More ➡
The National Labor Relations Board, strictly speaking, should have shut down nearly five months ago. But it has kept on going anyway. And even if President Obama’s slate of five nominees takes office, the issues surrounding its legal limbo almost certainly will continue onward to the Supreme Court. On May 22, the Senate Labor Committee approved all five and sent their names in one package for a full floor Senate vote. In February the president had re-nominated two members, Sharon Block and Richard Griffin, both of whose recess appointments were declared unconstitutional on January 25 by a federal appeals court. And in April, Obama named three more persons to round out the five-member board – Harry Johnson, Philip Miscimarra and Mark Pearce. Sound complicated? It’s even more so in light of a new bill passed by the House that could shut down the agency indefinitely.
The National Labor Relations Board … Read More ➡
A recent Reuters article regarding the likelihood of a bankruptcy filing by the city of Detroit may come as a surprise to those who have heard nothing but positive spin on Motor City’s resurgence since General Motors and Chrysler emerged from their Obama-manipulated bankruptcies. Who can forget Clint Eastwood’s 2012 Super Bowl ad which gave a heartfelt tribute (paid for by Italian-owned Chrysler) trumpeting Detroit’s comeback? It seems like the outlook is now not so rosy for Detroit as its emergency manager Kevyn Orr puts the odds of a bankruptcy for the city at 50/50.
A proposal has been set forth by Orr to creditors offering them just pennies on the dollar reminiscent of GM’s low-ball offer to its bondholders which was made just prior to their bankruptcy filing. The GM offer was not made in good faith and never had a chance of succeeding. The parallel reality is that … Read More ➡
It may turn out to be a very expensive mistake. On May 1, President Obama nominated 11-term Rep. Mel Watt, D-N.C. (in photo), to head the Federal Housing Finance Agency, established in July 2008 to oversee troubled mortgage giants Fannie Mae and Freddie Mac. Watt has a history of making racially-charged statements that are way over the line, even by debased “civil rights” standards. The two federally-chartered, publicly-traded companies, operating under government conservatorship for almost as long as FHFA has been around, own or guarantee around $5 trillion in home mortgages. If approved by the Senate, Watt would replace Acting Director Edward DeMarco, who has been under fire despite having done an even-handed job. Actually, his even-handedness has been the main problem.
The Federal Housing Finance Agency is a creature of national emergency. Almost a half-decade ago, with the balance sheets of the nation’s major financial institutions rapidly deteriorating, the … Read More ➡
An investigation by Department of Energy Inspector General Gregory Friedman has revealed that a consulting firm owned by former Republican Rep. Heather Wilson, who left Congress in 2009, was paid for work for which there was little evidence it had been done, all under what is described as a vague contract.
The inspector was called upon by the National Nuclear Security Administration to examine whether Heather Wilson and Company, LLC provided consulting services to four contractor-managed laboratories: Los Alamos National Laboratory, Sandia National Laboratories, Oak Ridge National Laboratory, and the Nevada National Security Site,
Among the reasons for the audit were questions about what, if any, work she did in exchange for $10,000 monthly payments, and whether a contracting officer for NNSA was pressured when Los Alamos sought to work with HWC. Friedman could not find any evidence of the latter concern.
But in the course of his investigation, Friedman … Read More ➡
As if taxpayers didn’t already have to stomach enough corruption, incompetence and dysfunction in the government’s promotion of “green” energy, two past exemplars failure have returned to discharge blame at each other.
Fisker Automotive and A123 Systems are the costly malfunctions that zap you over and over again.
The latest, from a FoxBusiness.com report, reveals that sparks flew between the two as both of the Department of Energy-financed companies plummeted in their production, public profiles and value. According to an anonymous source the network says was “familiar with the situation,” when Fisker announced last fall it would cease production, the manufacturer of the $102,000 plug-in Karma blamed the bankruptcy of its battery manufacturer – A123 – for its downfall. The last of Fisker’s only model was produced in July last year.
As Fox Business recounted, Fisker CEO Tony Posawatz told Bloomberg News in November, “Because we have no batteries, … Read More ➡
General Motors has announced a $4,000 rebate (or $3,000 and a four year, zero interest loan from government-owned Ally Financial) on the slow-selling Chevy Volt. The company had a choice regarding how to deal with an excess supply of Volts that is growing faster than demand. GM could have, once again, temporarily halted production until inventory (currently at about a 6 month supply) came down to reasonable levels. It instead chooses to lose more millions of dollars by spending on incentives designed to manufacture demand that otherwise is practically nonexistent.
The much-hyped Chevy Volt was originally presented by GM as a green wonder-car that would be a savior for the company with sales expected in the 10,000 per month range by now. Almost three years after first hitting showrooms, the Volt now sees sales stabilizing at a dismal rate of approximately 1,500 per month. That’s roughly one Volt every two … Read More ➡
Isabel Vincent and Michael Gartland report in the New York Post today:
Embattled state Sen. John Sampson’s campaign filings are peppered with missing cash and phantom refunds, The Post has found.
In three cases, money paid by political action committees to Sampson’s re-election campaign from 2009 to 2012 does not show up on his records.
From the story:
“Since New York state Senator John Sampson was indicted last month on multiple federal charges of embezzlement, obstruction of justice, and making false statements to the FBI, the media is justified in taking a very close look at Sampson’s finances,” said Ken Boehm, chairman of the National Legal and Policy Center, a political watchdog group.”
“If Sampson’s political bookkeeping is off by tens of thousands of dollars, the public deserves an explanation.”
John Sampson Busted; He Also Got Loan From Fraudster Ed Ahmad
Queens Politics Paralyzed Amid Reports … Read More ➡
It looks like the Obama Administration and the UAW are again working hand in hand as the two entities are coordinating on an offering of a total of 50 million General Motors shares. Treasury is planning on selling 30 million shares as the UAW’s VEBA (Voluntary Employee Beneficiary Association) Trust will sell 20 million shares. The VEBA Trust was formed to cover retiree’s medical benefits for the UAW and received about a 17.5% ownership stake in GM as part of the 2009 bankruptcy process.
The VEBA Trust was formed as part of GM’s negotiations with the UAW back in 2007, well before the GM bankruptcy. The UAW agreed to take responsibility for health care costs for retirees in exchange for GM funding the VEBA account to the tune of about $30 billion. The only problem was that GM didn’t have the cash flow to fund the account. The VEBA deal … Read More ➡
After last week’s announcement that Apple would hire former EPA Administrator Lisa Jackson to handle environmental issues, a series of videos released last week by Duke University were amusingly timed.
The six clips featured interviews with CEO Tim Cook, who succeeded the late, popular Steve Jobs, and were released by his alma mater’s Fuqua School of Business, where he earned his MBA. Cook had returned for a class reunion in April and while there Duke recorded discussions about topics such as inspiration, career planning, intuition, and other aspects of business management.
But comments he made in excerpts about ethical leadership and collaboration, in light of Jackson’s new employment, were guffaw-worthy. As NLPC outlined on Monday, Jackson fled EPA after undergoing harsh scrutiny about the agency’s – and her personal – practices of evading transparency. Under that cloak she conducted a highly political and destructive implementation of President … Read More ➡