While on the subject of energy, those of you who do not live in the Bay State may not be aware of Massachusetts’s recent venture into solar power. Succinctly put, it isn’t pretty.
In 2007 Governor Deval Patrick decided to “lure” a company called Evergreen Solar to the state. In one of the largest investments the state has ever made in a private company, Massachusetts taxpayers paid Evergreen some $58 million dollars to locate a plant there. Curiously, Evergreen wasn’t even remotely profitable at the time.
A look at the companies finances shows it has lost a cumulative $685 million. The majority of this red ink was on the books prior to Mr. Patrick promising state aid.
Well, here we are less than 4 years later and Evergreen has announced that it is closing its plant in Devens, Massachusetts, laying off some 800 workers. Evergreen President, Michael El-Hillow, cites China as the reason for the plant closure. According to him, not only does China subsidize solar power manufacturing, but, the cost of labor is so much less in China, that his company cannot compete.
It would appear though, that Mr. El-Hillow was familiar with these facts when he took the state’s money.
Evergreen has long been aware of China’s solar manufacturing advantage, waiting until it received the $58 million from Massachusetts to announce it would outsource jobs to a plant it continues to operate in China.
But, for those of you in Massachusetts, it does get worse.
Taxpayers will be thrilled to know that the state is so worried about getting a new tenant for the manufacturing site that it may let Evergreen keep it’s sweetheart $1-a-year lease– allowing the company to sublet it at a profit.
This is yet another example of government picking the “winners and losers”, and then throwing money at the winners whether their product is economically feasible or not, all in the name of the “laudable purpose du jour”. Imagine where we would be if the government had decided at the turn of the 20th century to subsidize the buggy whip industry. A free market economy does not, and cannot operate that way. While we waste money “jousting at windmills”, other pressing needs of our society are being ignored. Or, worse yet, money is being stolen from the taxpayers to subsidize non-competitive pipe dreams.