I’m not sure what MIT’s point is here. Peabody’s bankruptcy is the result of unlimited political manipulation. It was the intended result of Federal planning:
“So if somebody wants to build a coal power plant, they can. It’s just that it will bankrupt them because they are going to be charged a huge sum for all that greenhouse gas that’s being emitted.”
– Barack Obama, January 2008
The real issue is eco-corporatism, not “clean coal,” so it’s worth looking at other energy company bankruptcies that didn’t follow the Fed’s political script.
Solyndra’s bankruptcy was not the government approved plan.
Barack Obama visited Solyndra’s facility on May 25, 2010. Solyndra filed for bankruptcy in September 2011.
On whether he he regretted holding up Solyndra as a model for jobs and clean energy: “No, I don’t, because if you look at the overall portfolio of loan guarantees that have been provided, overall it’s doing well.“
“And what we always understood was that not every single business is going to succeed in clean energy, but if we want to compete with China, which is pouring hundreds of billions of dollars into this space, if we want to compete with other countries that are heavily subsidizing the industries of the future, we’ve got to make sure that our guys here in the United States of America at least have a shot…“
For A123, if the plan was to compete with China, the result was exactly the opposite:
“What we want to do is to have energy independence in America, and have control over our own ability to be free of Middle Eastern oil. That means that we want to manufacture the cells and do the assembly, and do the R&D all here in Michigan.“
– Jennifer Granholm, January 2009
(While Governor Granholm was fertilizing A123’s bankruptcy seeds, the frackers were actually doing something about our dependence on foreign oil. In spite of government interference.)
“This is about the birth of an entire new industry in America — an industry that’s going to be central to the next generation of cars…”
– Barack Obama, September 2010, during an event celebrating the opening of the A123 plant in Livonia
A123 was sold to the Chinese at bankruptcy prices. So we heavily subsidized the R&D on behalf of the Chinese.
- Peabody Energy was bankrupted by an administratively engineered avalanche of absurd and unconstitutional Federal regulations.
- A123 went bankrupt despite $100 million in Michigan tax credits and $255 million in Federal grants.
- Solyndra failed despite a $536 million Federal loan guarantee and a $25.1 million California tax break.
Yes, MIT, there are limits. So, consider these headlines for a future story:
A123’s Bankruptcy Shows the Limits of Advanced Battery Manufacturing
Solyndra’s Bankruptcy Shows the Limits of Thin Film Solar Cells
Or maybe: Green Bankruptcies Show the Limits of Winner Picking Corporatism