Cost per Job in DOE’s Loan Program Qualifies for One-Percent Status

As of today, October 22, 2011, the cost per job created (or saved) from the Department of Energy’s Federal Loan Guarantee Program is $554,217.61 (i.e., $35.9B in federal loan guarantees divided by 64,776 jobs). The most famous of these loan guarantees was the half-a-billion-dollar one for Solyndra, which ended with the loss of 1,100 jobs. Interestingly, that particular investment is no longer listed on the DOE’s website.

The Wall Street Journal has recently reported that a household making more than $506,000 of income per year is in the top “one-percent” of income in the United States. In essence, the average sum the government spent to create each green job exceeded the amount of money that would put an American household in the top 1% of income earners.

The only difference here is that the government actually did take this money from the American people, which is all the more reason Occupy Wall Street protestors should be occupying Washington and not Wall Street.

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About Sean Patrick Hazlett

Conservative clean energy crusader, national security hawk, financial analyst, engineer, and former military officer.
This entry was posted in Business, California, Clean Energy, Clean Tech, Energy Security, Finance and Economics, Media, Policy, Politics, Taxes and tagged , , , , , . Bookmark the permalink.

4 Responses to Cost per Job in DOE’s Loan Program Qualifies for One-Percent Status

  1. jc says:

    That would only be true if not one single loan gets repaid.

    • True. The point is that the government shouldn’t be picking and choosing winners when most bureaucrats have never spent a day in the private sector, and is spending way too much tax payer money in the process equivalent to over $500k per head. There are better ways to support clean energy and the loan guarantee program is not one of them.

  2. jc says:

    And I agree that the government should not be meddling in private enterprise. Private enterprise should be able to stand on its own, or it should fail.

    But you continue to make the same misleading argument. A loan guarantee does not represent an expenditure unless the loan fails. Therefore you cannot say the government is spending 500k a head when the government has not furnished that money, it has only provided a guarantee. As of right now, the cost per job is around $8,000. This assumes all the other loans get fully repaid, and the Solyndra loans the government guaranteed never see a single penny recovered from the liquidation of the assets. Here is to hoping the number doesn’t grow.

    • “But you continue to make the same misleading argument. A loan guarantee does not represent an expenditure unless the loan fails.”

      But it is an expenditure until the company pays back the loan. The government takes money from the taxpayer and issues that cash flow out to the company. Until it is repaid, it is an expenditure. I agree that the expenditure should come down over time. It just hasn’t yet.

      Additionally, according to the DOE site, the government has provided over $35 billion in loans (not just guarantees). So the expenditures appear to have already been paid out.

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