D.O.E Backed Green Energy Firm CEOs Awarded 6 Figure Bonuses Before Going Bankrupt

A Center for Public Integrity and ABC News investigation found that green energy companies that received tax payer backed loans from the Obama administration, gave it’s top executives six-figure bonuses before filing for bankruptcy.

In March 2010 Beacon Power Corp., a Massachusetts energy storage company, paid out cash bonuses of $259,285 to three executives, Securities and Exchange Commission records show.

Last October, Beacon Power filed for Chapter 11 bankruptcy.

Ener1 subsidiary EnerDel, maker of lithium-ion battery systems, landed a $118.5 million energy grant in August 2009. Corporate parent Ener1 paid $725,000 in bonuses to three executives, including $450,000 to then-CEO Charles Gassenheimer. In 2010 Vice President Joe Biden toured a EnerDel plant in Indiana and championed its taxpayer-supported expansion as one of the “100 Recovery Act Projects That Are Changing America.”

This January, Ener1 filed for Chapter 11 bankruptcy protection.

At least two other firms that received Energy Department funding, one a $500,000 grant, the other a $535 million loan guarantee, handed out large bonuses to executives and later went bankrupt.

When asked about the pay outs by CPI and ABC News, the Department of Energy said it is troubled by the practice and intends to convey that message to loan recipients.

“We don’t begrudge companies or their executives for their success, but it is irresponsible for executives to be awarded bonus compensation when their workers are losing their jobs. We take our role as stewards of taxpayer dollars very seriously, and as such, we will make clear to loan recipients our view that funds should not be directed toward executive bonuses when the rest of the company is facing financial difficulty.” said department spokeswoman Jen Stutsman.

The nonprofit Citizens Against Government Waste counts nearly 20 government-backed energy companies that have run into financial trouble ranging from layoffs to losses to bankruptcies. An outside consultant hired by the White House said the Energy Department’s loan pool includes $2.7 billion in potentially risky loans and suggests the agency hire a “chief risk officer” to help minimize problems.

“Giving a bonus to the executives under these circumstances is rewarding failure with our money with no chance of getting it back,” said Leslie Paige, spokeswoman for the nonpartisanCitizens Against Government Waste.’

Solyndra, the first recipient of an Obama green energy loan, was among the companies to dole out thousands in executive payments, in its case, just months prior to its late August collapse and early September bankruptcy.

In interviews, executives with companies that got tax payer backed loans defended the payments as proper. Some said bonuses were granted for work done in a previous year, before financial problems had fully developed, and that the executive cash infusions were sometimes linked to broad corporate milestones.

One company executive said the Energy Department explicitly allows for federal funds to be used to pay out executive bonuses.

“Any company that’s going into bankruptcy or any executive that ran a company into bankruptcy shouldn’t be getting bonuses in the first place,” said Sen. Charles Grassley, R-Iowa, former chairman of the Senate Finance Committee. “In the case where there might be federal grants or federal loans, I would be very concerned.”

Grassley added: “The purpose of our grants for energy or almost any other grant of government is for the purpose of innovation. It’s not for the purpose of feathering the nest of a private company executive.”

In recent weeks, several other companies backed by DOE dollars have encountered deep financial woes.

At least six more Energy Department loan and grant recipients, from electric car maker Fisker Automotive to electric-car battery maker A123 Systems to Colorado-based Abound Solar,have laid off workers or suffered financial troubles.

“There were going to be some companies that did not work out,” Obama told reporters in October, after Solyndra’s meltdown. “All I can say is the Department of Energy made these decisions based on their best judgments.”

Rest assured that those decisions were not at all politically motivated.

U.S.D.A Buying 7 Million Pounds Of Ammonia-Treated Meat for School Lunches

The ammonia-treated bright pink meat dubbed pink slime, recently rejected by fast food titans McDonald’s, Taco Bell and Burger King, is being shipped in by the boatload to school lunch trays across the nation.

The U.S. Department of Agriculture is purchasing 7 million pounds of the “slime” for school lunches, The Daily reports. “Lean Beef Trimmings,” is the official name of the product, made up of a ground-up combination of beef scraps, cow connective tissues and other beef trimmings that are treated with ammonium hydroxide to kill pathogens like salmonella and E. coli. That mix is then blended into traditional meat products like ground beef and hamburger patties.

“We originally called it soylent pink,” microbiologist Carl Custer, who worked at the Food Safety Inspection Service for 35 years, told The Daily. “We looked at the product and we objected to it because it used connective tissues instead of muscle. It was simply not nutritionally equivalent [to ground beef]. My main objection was that it was not meat.”

Custer and microbiologist Gerald Zernstein concluded in a study that “Lean Beef Trimmings,” are a “high risk product,”.

Zernstein says that “scientists in D.C. were pressured to approve this stuff with minimal safety approval” by the Bush administration. The USDA claims that its ground beef purchases “meet the highest standard for food safety.”

There are numerous health concerns about the ingestion of “pink slime”, particularly dangers associated with ammonium hydroxide, which can both be harmful to eat and has potential to turn into ammonium nitrate, a common component in homemade bombs. It’s also used in household cleaners and fertilizers.

In 2009, The New York Times reported that despite the added ammonia, tests of “Lean Beef Trimmings” of schools across the country revealed dozens of instances of E. coli and salmonella pathogens.

Between 2005 and 2009, E. coli was found three times and salmonella 48 times, including two contaminated batches of 27,000 pounds of meat.

LulzSec, Anonymous Betrayed by Founding Member

Five of the top members of the infamous computer hacking group LulzSec have been arrested and charged by the F.B.I.

According to reports the arrests came after the group’s “senior leader”, Hector Xavier Monsegur “Sabu”, 28, pled guilty to several charges of computer hacking conspiracy and began working with prosecutors, Monsegur is facing a maximum of 124 years behind bars.

The five alleged members arrested were identified as Ryan Ackroyd aka “Kayla” and Jake Davis aka “Topiary” from London, two residents of Ireland, Darren Martyn aka “pwnsauce” and Donncha O’Cearrbhail aka “palladium”, and Jeremy Hammond aka “Anarchaos” from Chicago. According to a FBI press release, all but Davis face charges of computer hacking conspiracy and varoious other charges. Each carries a maximum 10 year prison sentence.

Jeremy Hammond, is named in the report to have been the main person behind the hack on US security company Stratfor last year which resulted in the release of 1,000s of the companies internal e-mails.

According to court papers, Sabu was an “influential member of three hacking organizations Anonymous, Internet Feds and Lulz Security, that were responsible for multiple cyber attacks on various businesses and governments in the United States and the world over.” He allegedly acted as a “rooter,” a computer hacker who identified vulnerabilities in the computer systems of potential victims.

FBI officials involved with the investigation have been quoted as saying “this is devastating to the organization”, and that these arrests are “chopping off the head of LulzSec.”

Following the reports, Anonymous posted on its Twitter feed:

“We are Legion. We do not have a leader nor will we ever. LulzSec was a group, but Anonymous is a movement. Groups come and go, ideas remain”

 

Obama’s Economic Recovery for the 1%

The economy has supposedly been in recovery for two years now and President Obama never misses an opportunity to talk up that recovery but as it turns out the wealthy are the ones doing all the recovering.

In 2010, the first full year since the end of the Great Recession, the top 1 percent of Americans took in 93 percent of all the income gains that year, leaving the other 7 percent of gains to trickle down to the other 99% of U.S. workers.

Emmanuel Saez, a Berkeley economist, co-created a resource called the World Top Incomes Database. Saez and his colleagues crunched the data on income growth from 2010, the most recent year available, and found that it was incredibly, and unfortunately predictably, one sided.

While much of the country is struggling to maintain, with a growing number of people on the verge of poverty or already there, the rich continue to get richer.

Income for most workers has barely risen in 3 decades, while the top 1 percent’s income has almost triple. Economists and other experts say that could be the result of any number of factors, including the decline of labor unions and tax policies such as the Bush tax cuts, which were extended by Obama, that favor the wealthy.

A 2011 study states that income inequality is a major barrier to economic growth.