Obama’s Crony Investment Failures Continue to Pile Up
According to a new report, yet another company given loans by the Obama administration’s Department of Energy has failed:
A Michigan maker of vans for the disabled that received a $50-million Energy Department loan has quietly ceased operation and laid off its staff.
Vehicle Production Group, or VPG, stopped operations after finances dipped below the minimum threshold required by the government as a condition of the loan, says its former CEO, John Walsh. Though about 100 staff were laid off and its offices shuttered, it has not filed for bankruptcy reorganization.
VPG, of Allen Park, Mich., received its Energy Department loan under the same clean-energy programs under fire by House Republicans, especially the $527 million to troubled plug-in hybrid car maker Fisker Automotive and $535 million to solar startup Solyndra, which filed for bankruptcy reorganization. VPG was deemed eligible for the loan because some of its vans were expected to be fitted with engines fueled by clean compressed natural-gas.
The VPG loan was controversial because it was believed that the company was a fundraiser for President Obama:
VPG was part of the portfolio of companies under Washington, D.C., -based investment firm Perseus whose vice chairman, James Johnson, was an adviser and fundraiser to President Obama. Perseus said at the time that Johnson played no role in procuring the loan for VPG. The Energy Department said at the time that the loan was based entirely on its merit after two years of review.
This gives the appearance the Energy Department takes political affiliation and support into consideration more than a company’s ability to thrive in the free market when it makes its judgments on “merit.” We can only hope that the $50 million owed to the taxpayers is repaid. It’s just unfortunate that they had so much taxpayer money to throw away in the first place.