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According to President Obama, the best way to keep the terrorists who conducted a coordinated attack killing 130 in Paris, France last week from winning is for the leaders of the world’s nations to agree to a climate pact as an “act of defiance” as they meet in Paris this week. The Associated Press’ Nancy Benac reports:
Pushing for a powerful climate deal, President Barack Obama called the global talks opening Monday outside Paris an “act of defiance” against terrorism that proves the world stands undeterred by Islamic State-linked attacks in Europe and beyond.
Obama used his speech to more than 150 world leaders to salute Paris and its people for “insisting this crucial conference go on” just two weeks after attacks that killed 130 in the French capital. He said leaders had converged to show resolve to fight terrorism and uphold their values at the same time.
“What greater rejection of those who would tear down our world than marshaling our best efforts to save it,” Obama said.
Also according to President Obama, a climate deal in Paris this week would stimulate the world’s struggling economies, as reported by Agence France-Presse:
“The old rules that said we couldn’t grow our economies and protect our environment at the same time, those are outdated. We can transition to clean energy without squeezing businesses and consumers.”
Obama insisted an ambitious deal in Paris would spur investment, as it would signal to businesses that they should “go all-in on renewable energy technologies”.
“If we can get an agreement done, it could drive new jobs and opportunities, and investment in a global economy that, frankly, needs a boost right now.”
President Obama has lots of experience with investing in green energy companies, including investing billions of U.S. dollars with global firms. In fact, the U.S. government under President Obama has guaranteed loans to many of these firms, where should any green energy company fail, U.S. taxpayers will bail out the entities that lent money to them, provided that the green energy companies passed the scrutiny of the experts at the U.S. Department of Energy.
At least, that’s what the DOE claimed as it defended its loan guarantee programs back in March 2012, as reported by Patrick O’Grady of the Phoenix Business Journal:
The U.S. Department of Energy is defending its loan guarantees to First Solar Inc., Abengoa Solar and others, saying the projects are moving forward as planned and will continue to be monitored.
The DOE, which granted more than $14.5 billion in guarantees to solar manufacturers and projects, took issue with a U.S. House Committee on Oversight and Government Reform report that singled out the two firms along with others as being risky bets in the program.
“For nearly a year, Congressional critics of the Department’s loan programs have demonstrated a consistent pattern of cherry-picking individual emails from the hundreds of thousands of pages of documents the Department has provided to Congress with the sole purpose of inventing false and misleading controversy,” said DOE spokesman Damien LaVera. “As these investigations have made clear, decisions made on loan applications were made on the merits after extensive review by the experts in the loan program.”
That scrutiny by President Obama’s DOE loan program “experts” has become rather dramatically relevant today because it appears that one of the two firms specifically identified as being a “risky bet” by Congressional investigators back in 2012 is currently collapsing into bankruptcy, as the Spanish firm Abengoa failed to get an emergency injection of capital to keep its business afloat. Katie Linsell and Luca Casiraghi of Bloomberg report:
Abengoa SA’s bonds and stock tumbled to records after the embattled renewable-energy company said it was seeking preliminary protection from creditors following the breakdown of talks with a new investor….
Abengoa, which employs more than 24,000 people worldwide, has been seeking to reassure investors that it can generate enough cash to service its debt pile of about 8.9 billion euros of consolidated gross debt. The Seville-based company said earlier this month that Gonvarri Corporacion Financiera, a unit of industrial group Corporacion Gestamp, would become its biggest shareholder after agreeing to acquire a 28 percent stake by injecting new funds.
“The future of the company seems very black,” said Carlos Ortega, a trader at Beka Finance Sociedad de Valores SA. “It has a tremendous amount of debt which no bank wants to refinance and now even its partners are backing out.”
When the “experts” in the DOE’s loan program completed their “extensive review” of Abengoa, the Spanish company had been assigned the rating of Ba3 by Moody’s Investment Service, which considered the firm’s prospects to be “speculative” at best and really just one step above being “highly speculative”. Which is to say that any investment in the firm would represent more than a moderate amount of risk.
Three months after DOE spokesman Damien LaVera defended the DOE’s decision to commit to bail out firms lending money to Abengoa if it were ever to go under before the loans were paid back, Moody’s downgraded the company as its analysts recognized that investments in the politically-connected firm were becoming increasingly risky, even with the U.S. government’s backing. By the time of the Bloomberg article, Moody’s had dropped the firms’ credit rating to B3.
Since the Bloomberg article was published one week ago, Moody’s Investors Service has continued to downgrade the company, where it now ranks at Caa2, which is to say that Moody’s considers it to be in such “poor standing” that it is now eight levels below qualifying as “investment grade”.
As for why the company is failing, please consider the following explanation from Political Calculations:
A Venn diagram is a tool for visually demonstrating the relationships between different sets of things. Using these diagrams, we can quickly see what aspects of the things we’re comparing are common between the sets we’re comparing, as well which aspects are not common.
With that in mind, here is our Venn diagram showing the relationship between “Green Energy” companies, and “Energy Companies That Don’t Need Constant Government Subsidies To Stay Afloat”:
We note that there is a small area where the groups overlap, but otherwise, the two groups have little in common….
Today, that overlap remains just as small as ever, as it would appear that the only beneficiaries of the U.S. government’s support for green energy are the business world cronies of the politicians and bureaucrats in charge of approving the government’s spending for such poorly considered programs. And of course, the politicians and bureaucrats themselves.