American Centrifuge Boondoggle Exonerates Steven Chu

by William Yeatman on January 13, 2012

in Blog

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Not long ago, I blogged about how Energy Secretary Steven Chu was being unfairly scapegoated by the House of Representatives for the spectacular collapse of Solyndra. As I explained then, Members of Congress were the ones who passed the porkulus, a.k.a. the American Recovery and Reinvestment Act, which required the Department of Energy to spend almost $30 billion on “green jobs” as soon as possible. Moreover, the Energy Department received over 500 letters from Members of Congress on behalf of loan guarantee applicants (presumably constituents). In playing fast and loose on risky energy investments, Secretary Chu was following the Congress’s orders.

This week, the Congress further bolstered my defense of Secretary Chu. Today’s Politico Morning Energy reports:

The collapse of efforts in the House to save the uranium enrichment firm USEC through legislative tactics has left lawmakers in an awkward position with Energy Secretary Steven Chu: They need a favor. After legislators in both chambers raced — and ultimately failed — to insert measures into last month’s omnibus spending bill to prop up USEC’s multibillion-dollar American Centrifuge project in Piketon, Ohio, leaders in the House are now urging Chu to use his existing powers to help the project, according to a draft copy of a letter obtained by POLITICO.

According to the Hillsboro Times Gazette, the future of the American Centrifuge project depends on a $2 billion loan guarantee from the Energy Department Loan Programs Office (whence Solyndra). The deal was near completion at the end of the George W. Bush administration, and but it has been in a holding pattern under the Obama administration. Evidently, the U.S. Enrichment Corporation (USEC)—the parent company—cannot wait much longer for the loan to come through. BusinessWeek recently reported that USEC might have to lay off about 450 workers in Ohio, Tennessee and Maryland if uncertainty about funding meant it had to stop most activity on the project. That warning prompted a bipartisan push in the Congress last month to throw American Centrifuge a lifeline, in the form of a $150 million bailout, to keep it above water until the loan guarantee materializes.

To recap: Members of Congress from both parties last month wanted to give the American Centrifuge boondoggle one  subsidy, in order to buy enough time for the Department of Energy to give it a second, bigger subsidy. That effort failed, so now leaders in the House are urging Secretary Chu to shuffle his budget, and thereby engender enough money to temporarily save American Centrifuge (until the next bailout).

The majority party in the House would have voters believe that there is no difference between crony capitalism and pork barrel spending. In fact, they are one and the same: venture socialism.

JH January 14, 2012 at 1:03 pm

Your article wasn’t worth the time it took to open!

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