Republican TOP Questions Loan Program
The Obama administration has been experiencing plenty of criticism lately; some criticized his ability to lead, while others criticize his lack of involvedness to make changes. Well it is to be expected, as plenty of politicians; especially the republicans oppose his election in the first place.
By now there has been another issue involving Obama, this time it’s within the scope of financing. Two senators have asked whether it was wise for the administration to approve of a loan of $529 million to Fisker, a company which has suspended U.S. production of a heavily touted plug-in electric car as it revamps its business plan.
Charles Grassley and John Thune, the top Republican on the Judiciary Committee and Senior Republican member of the Finance and Commerce committees respectively, questioned as to why the company was given the loan, given the fact that the company has uncertain issues regarding their production after receiving some of the loan.
“Though the Department of Energy has now frozen the remaining portion of Fisker’s loan, questions remain as to why a loan was extended to this now ‘troubled’ auto company in the first place,” the two lawmakers said in an April 20 letter that was released on Monday.
By now the DOE is working with an outside specialist, Houlihan Lokey, to evaluate a variety of questionable loans, including Fisker.
Fisker was approved for the $529 million loan in 2009 under a DOE program aimed at helping automakers make more fuel-efficient cars and trucks.
The company received about a third of the money initially to mainly support U.S. engineering and other efforts to roll out its first electric car, the $100,000 Karma that was assembled in Finland. But delays in getting that car to showrooms prompted the DOE to hold additional financing.
Remaining funds were to go to develop a $50,000 sedan, called the Atlantic, at a former General Motors factory in Wilmington, Delaware. Work on the Atlantic was suspended in February.
The Obama administration had been relentlessly trying to find other sources of renewable energy as problems arises from limited supply of oil due to tensions with the Middle East. It prompted projects including that of solar energy, but, an investment on solar-panel maker Solyndra failed, as the company collapsed last year. This sparked debates on the administration’s justification in loan programs aimed at economy projects and related jobs.
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