Evergreen Solar

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.

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SoundOffSister

The Sound Off Sister was an Assistant United States Attorney for the Southern District of Florida, and special trial attorney for the Department of Justice, Criminal Division; a partner in the Florida law firm of Shutts & Bowen, and an adjunct professor at the University of Miami, School of Law. The Sound Off Sister offers frequent commentary concerning legislation making its way through Congress, including the health reform legislation passed in early 2010.

9 Comments

  1. Dimsdale on January 22, 2011 at 8:48 am

    Coming to a federal government near you!  Massachusetts and the "mini Øbama" are simply previews of what the rest of the country can expect.  (see our "universal"ly expensive, and decidedly crappy, healthcare).



  2. joe_m on January 22, 2011 at 10:14 am

    Regardless of how many failed government programs we have, some still think the government has the answer.

    It's easy to throw good money after bad when it's not your money.

    It would be funny if it wasn't our money.



  3. sammy22 on January 22, 2011 at 4:35 pm

    Guess what: China subsidizes solar power. That way they get an advantage and the US companies cannot compete. But, how we whine!



  4. gillie28 on January 22, 2011 at 10:48 pm

    The cynical side of me is wondering if the governor has a "relative" with a financial interest in that solar company.  It IS a publicly-traded company (remember looking at it some years ago).  By the way, how are those wind turbines off the cape coming along????



  5. sammy22 on January 23, 2011 at 4:58 am

    MA is not doing badly at all: unemployment is 8.2%, 38,000 jobs were added in 2010, and the state has reversed its flight of citizens. Meanwhile, in CT………….?



  6. weregettinghosed on January 24, 2011 at 5:47 am

    Dare I say those in politics know one thing only, that is the act of getting elected; no more {for God's sake] no less. When the people stop buying into clever talk, nicely parted hair does and fancy clothes will people of intelligence get into office thereby doing some good for the country. Should we have had these types around during the founding of America we never would have gotten the Declaration of Independence; then perhaps I give our history too much credit and these types were around but they were where they were suppose to be, out in fields or laboring in mundane, but needed jobs, drinking and dreaming at local taverns when someday their heirs would one day be in office…… oh my, oh my dreams do come true….



  7. Lynn on January 26, 2011 at 2:33 am

    Yeah, what about Connecticut. Let's see Democrat governor, put in office by Unions, that will reduce unnecessary state agencies and public sector Jobs. Right. Before that, A Republican Governor with a Democrat veto proof majority in the General Assembly. Five years ago, a chairman of the Commerce  Department in the General Assembly who said "Manufacturing is dead in CT, we're investing in our pharmaceutical companies (who have all left the state) and the film industry (which has created how many jobs, 20?)"

    Way to go! How about our illustrious Democrat Senator who chairs the Budget Committee in the General Assembly and actually said at her debate for Reelection, "We have a good budget", Someone forgot to tell her we have a $3,4+ or – billion deficit. Do you see a pattern here?Just 15  years ago, we were one of the richest states in the Union. One Party controlling anything is a failure.



  8. sammy22 on January 26, 2011 at 9:40 am

    CT is still the richest state in the Union, because the people who make a lot of money get to keep a lot of money. And, others complain about losing the pre-tax break they had with the HSAs. Aren't the HSAs "funded" with income, why should there be a pre-tax break?



  9. Lynn on January 27, 2011 at 2:47 am

    First only the very rich will be able to stay here. The poor are stuck here. The upper middle, & middle class will live in FLA, Texas, or other states 6 months and one day. We lose their spending power and their income taxes. Connecticut has a brain drain and an income drain.



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