Friday, October 7, 2011

Solyndra the perfect example of why Government should not be involved in private enterprise.

This one goes under the category of gross stupidity. So the current administration in Washington okays half a billion dollars of taxpayer funds to set up as company they KNEW was doomed from the get go. I'm certain a few head will role in the Department of Energy after all the political dust has cleared, but the problem is the philosophy that got us here. The United States Government, or any government (Like Peoria, hint hint hint) has no business getting involved in the funding of any private industry. Period. Not solar panel companies, not hotels, not restaurants, not even museums that are partially sponsored by private corporations to tout their product. Not even if that product is an important part of our economy. Not even if that business is a major supporter of local charities. The consider that to be good corporate citizenship. They see that as public relations. The only business government should be involved in is regulation and administration. That is their purpose. Not to become empire builders, but to encourage others to invest in the City or Country by providing a level playing field for all to profit. If the Obama Administration knew the Chinese would enter the market and flood it with cheap knock off solar panels, they had two obvious choices to make. #1) Tell the Solyundra folks to build cheaper panels or not to try. #2) Level the playing field by raising tariffs on imported goods to make the importers costs near to ours. This is a massive failing of the US policy concerning trade in general. Many of our import laws allowed cheap goods to flood our nation after the second world war in order to help the conquered nations to rebuild their economy. When you allow cheap imports to flood your market, you force the American companies to cut costs in order to compete. Now that may sound like a great thing, but you have to realize where management cuts They don't want to cheapen the quality of their product, so they decide they can be competitive by reducing their work force, thereby maintaining profits to their investors while continuing to produce their product at a slower scale. Next, of course, comes the reduction of quality. This occurs when they realize that by cutting the work force, they have reduced their ability to produce a quality product on the same scale as before they reduced the work force. It is a slippery slope that leads to the current economic situation. Heads will role, fingers will point, and the end result is that the American taxpayer will suffer again. Sort of like this debacle with the Marriott Hotel people. Unless this project is immediately halted and handed back to the investors, the end result will be the same. Taxpayers will get screwed.


  1. An economic system is an organized approach to producing and distributing goods and services. It is an organize way to answer the three economic questions of what, how and to whom to produce.

  2. Which I fully agree with, but how does that relate to the discussion above. My point is that government should not be involved in the success or failure of individual businesses. Supply and Demand will dictate what will succeed and what will fail.