Last Thursday, Politico blasted out the kind of grabby headline that has helped it dominate insider political media: “Silver resigns over Solyndra loan.” Scandal! An administration in crisis! Dems in disarray! It was tailor-made to win the morning.
But it was fiction. The story itself offered no evidence that the resignation of Jonathan Silver, the director of the Energy Department’s loan office, was related to the Solyndra affair. Indeed, the available evidence points the other way. Silver was brought on by DOE after the Solyndra loan had received final approval. When it became clear there would be no more funding for the Section 1705 loan-guarantee program, Silver told Energy Secretary Steven Chu he’d be leaving around Sept. 30, when the program expired. That was back in July.
By all accounts, Silver transformed the loan-guarantee program, taking the staff from 35 to 180 and professionalizing the operation. When it looked like Solyndra was in trouble, he tried to give it a boost by restructuring the loan to draw in more private capital. Republicans said he “should have withdrawn support from the company as signs of financial distress began to emerge,” as BusinessWeek puts it, but as numerous people have pointed out since, a program that only makes risk-free investments isn’t going to help innovative, fledgling industries.
It’s not like the administration didn’t know there were risks. This is how Biden aide Ron Klain put it in an email to fretting Obama adviser Valerie Jarrett on the eve of the Solyndra factory event:
The reality is that if POTUS visited 10 such places over the next 10 months, probably a few will be belly-up by election day 2012—but that to me is the reality of saying that we want to help promote cutting edge, new economy industries.
Obama knew this. Chu knew this. Why would they fire a venture capitalist over the failure of 1 percent of his portfolio? If private-sector investors were judged that way, it would render markets paralyzingly risk averse. Under Silver, the program has put together $35 billion in loans for 39 clean energy projects, including all sorts of cutting-edge sh*t that the political media can’t be bothered to cover. (Just as an appetizer, greentech reporter Katie Fehrenbacher has a list of five of the cooler ones.) DOE expects the projects to fund more than 60,000 direct jobs across 35 states. There are bigger things at stake than Solyndra.
Later on Thursday, Politico added a “clarification” to the bottom of the story — “the headline on an earlier version of this story misstated the reason for Silver’s departure” — and tweeted: “Clarified headline: Department of Energy loan program official steps down.” Huffington Post quietly changed its original headline — “Solyndra’s first scalp?” — to something more factual as well. But the implication had already been released into the wild and entered into conventional wisdom.
Anyway, the idea that Silver resigned “over Solyndra” — or is a “casualty” or a “scalp” — isn’t the most important episode in this story, but it’s a particularly clear example of what an insider circle jerk it has become.