Home » Opinion » Editorials
Obamanomics: A case study
The Chinese are about to buy a Massachusetts battery-maker, and the American taxpayers might have doubly subsidized the deal.
On Tuesday a federal bankruptcy judge gave the OK for auto-parts maker Wanxiang America Corp., a subsidiary of China's Wanxiang Group, to buy A123 Systems, a Waltham, Mass., maker of batteries for electric cars. Wanxiang is to pay $256.6 million if the deal is approved by federal officials. But that is not where the taxpayers come in.
The taxpayers are already in the deal. They got in via a $249 million Department of Energy grant in 2010. It was part of the federal "stimulus" bill. A123 has received $133 million of the grant.
As with Solyndra, the solar-panel maker that was approved for more than half-a-billion dollars in federal financing before it went bankrupt, Obama administration officials approved hundreds of millions of dollars to a "green energy" company not based on its financial prospects, but on Obama's personal preference for alternative energy.
These "investments" are financed by U.S. debt, much of which is bought by Chinese investors. The Chinese own $1.4 trillion in U.S. treasury bonds (that's after selling some in the past year).
If the sale is approved, Wanxiang will walk away with a steal. It will get a battery maker the Chinese thought was worth $450 million, and it will pay just $7.6 million more than A123's 2010 federal grant. A bust for taxpayers becomes a boon for Chinese investors.
But that is not all. China is awash in interest payments we taxpayers are making on federal treasury bonds. If some of the Chinese profit from those payments was invested in Wanxiang, then taxpayers have subsidized both ends of this deal via interest payments on debt used to finance A123 in 2010 and to finance its purchase in 2012.
This, in a nutshell, is Obamanomics. Enjoy; we're getting four more years of it.
READER COMMENTS: 7
- Surprise, surprise: Obamacare funds abortions - 59
- Casino gambles: Hopes dashed all over - 8
- USNH's raw deal: Part deux - 2
- Every vote counts: Here is the proof - 5
- Burning rubber: And public dollars - 0
- Hassan was right: 'Bullying' bill goes too far - 12
- Strategery: A war by any other name - 28
- Freeh dumb: Favoritism in Vt.? - 6
- Public be damned: Litchfield latest example - 2
READER COMMENTS: 0
- Scots spurn independence, vote to stay in the United Kingdom - 1
- Roger Brown's First and 10: Answers forthcoming - 0
- NHMS chief Gappens is on board with the Chase changes - 0
- Another View -- Ben Rose: How NH's John Stark helped defeat the British at Saratoga - 1
- Celebrating Claremont: A 250th birthday party - 0
- Hampstead's Suess ready for Whelen Modified race - 0
- College Football: Big Green kick off season vs. Cent. Connecticut - 0
- Son says shooting of mom during DEA raid was a mistake - 17
- Londonderry Rotary to host forum next week - 0
Supporters eager for Hillary's return to NH
Ayotte pushes bill to combat 'spice'
Mark Hayward's City Matters: Dean Kamen is a genius inventor, and he's pretty good at oratory, too
Casino gambles: Hopes dashed all over