Hattip to Mary Katherine Ham at Hot Air. Back in 2008 Obama stated that if elected he would create five million green jobs over the next decade. At this stage it becomes monotonous to bring up the fact that the promises of Obama bear as much relationship to reality as a lightning bug does to lightning, but the failure of Fisker Automotive can be taken as a symbol of the failed economic policy of the Obama administration.
In 2009 the Obama administration authorized a half a billion loan guarantee to Fisker, and about 193 million was spent. When Fisker opened a plant in Delaware, Veep Biden was on hand. The car company is now reeling to bankruptcy after spending 600K on each 100K Fisker Karma it sold:
Fisker Automotive Inc. spent more than six times as much U.S. taxpayer and investor money to produce each luxury plug-in car it sold than the company received from customers, according to a research report.
The Anaheim, California-based company made about 2,500 of its $103,000 Karmas before halting production last year, disrupting its plans to use a $529 million U.S. loan to restart a shuttered Delaware factory owned by the predecessor of General Motors Co. (GM) The Karma was assembled in Finland.
Fisker stopped manufacturing cars late last year and fired three quarters of its remaining workers April 5. The company’s first repayment of $20.2 million on the Energy Department loan is due April 22, the report said.
A U.S. House panel is scheduled to hold a April 24 hearing on Fisker and its government financing. Invited witnesses include co-founder and namesake Henrik Fisker, who resigned last month; CEO Tony Posawatz and Chief Operating Officer Bernhard Koehler, who helped start the company whose customers include singer Justin Bieber and actor Leonardo DiCaprio. Continue reading
Ah the next four years are going to be so enjoyable. When it comes to crony capitalism Adam Smith said it well:
“The proposal of any new law or regulation of commerce which comes from this order [that is, 'those who live by profit'], ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.”
Milton Friedman was eloquent on the subject of government supporting private enterprises: