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Energy secretary, grilled over Solyndra, says politics played no part in loan

Energy Secretary Chu testified in Congress Thursday for nearly four hours. He took responsibility for extending loan guarantees to the now-bankrupt Solyndra, but said his actions were strictly legal.

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• Solyndra was at the front of the line of applicants for loan guarantees right up until the Bush administration left office, contrary to statements by Rep. Joe Barton (R) of Texas, who said the Department of Energy under President Bush had rejected Solyndra. In fact, Chu said, the same DOE officials who approved Solyndra as a leading contender during the Bush years made that argument successfully to him.

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From the start, it was clear that Republican members of the committee were eager to grill Chu to see if there were inconsistencies in his statements or whether he was reckless in approving the loan guarantees.

“A central focus of the investigation is to understand why DOE did what it did and how we find ourselves with this taxpayer-funded debacle,” said Rep. Fred Upton (R) of Michigan, chairman of the Energy and Commerce Committee. “The number of red flags about Solyndra that were raised along the way – many from within DOE – and either ignored or minimized by senior officials is astonishing.”

Committee Democrats tried to defend Chu, criticizing Republican leaders for gathering 186,000 documents from the DOE, White House, and other branches of government and failing, they said, to find a scandal. Instead, they said, the documents only showed internal debates of the issue, with one major exception: an attempt by an unnamed DOE official to request that Solyndra delay its layoff announcements until after the 2010 elections. Rep. Henry Waxman (D) of California dismissed that as “small potatoes.”

“I don't condone this action if it's true,” he said. “But let's keep this in perspective. Asking Solyndra to delay its announcement did not put any taxpayer money at risk. It didn’t change Solyndra’s business decisions. It had nothing to do with any of the loan guarantee decisions.”

“We have lost the money,” he added. “It’s unfortunate. But there’s no scandal – there's nothing there.” He also invited Republicans to “stop dancing on Solyndra's grave” and get on with energy legislation that would put people back to work.

But Cliff Stearns (R) of Florida, who chaired the subcommittee on Oversight and Investigations, was among the unconvinced.

“You seem to fail to monitor the loan guarantee process, failed to head the warning sign of the Treasury Department, OMB (Office of Management and Budget) and even your own legal counsel,” he scolded Chu at the end of the meeting. “You ignored subsequent Solyndra bankruptcy predictions two years ago by your staff” and ordered the “illegal subordination of taxpayers to two hedge funds.”

Together, he said, it “shows a high degree of mismanagement and ineptitude and I would think under the circumstances that it could have been done a lot better. Don't you feel, in retrospect, that this was poorly managed?”

After a long pause, Chu spoke.

“As I look back at the events and at the time and what did we know, when we knew it, that decisions were made, competent decision were made by the people in the loan program,” he said. “This is very important that the US be supporting these innovative technologies.”

Five-and-a-half hours after the meeting began, Congressman Stearns brought it to an abrupt close.

“I'll conclude by saying, I don’t know how many loan risks of half a billion dollars we can afford to lose as taxpayers.”

IN PICTURES: Solar power

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