Awesome Timing
From something called the Washington Free Beacon, via Real Science
Just days after the Export-Import Bank approved a multi-million dollar federal loan guarantee to benefit a mostly foreign-based wind-energy outfit, the company pink-slipped more than 200 American workers.
The Export-Import Bank, a federal agency that promotes and finances sales of U.S. exports to foreign buyers, approved a $32 million loan guarantee on Aug. 2 for a Brazilian firm to purchase wind turbines from LM Wind Power. According to itswebsite, LM Wind Power is headquartered in Denmark.
“Ex-Im Bank’s financing, which guarantees a Bank of America loan, will support approximately 250 permanent American jobs at the company’s Little Rock, Ark., and Grand Forks, N.D., manufacturing facilities,” the bank said in a release.
The company maintains a manufacturing presence in Arkansas and North Dakota—but the company laid off 234 of the Arkansas plant’s roughly 300 workers just two days after its loan was approved.
“We have this week told our workforce that we are re-sizing our workforce and business to fit our plans for 2013,” Adam Ruple, human resources director for LM Wind Power, told the City Wire of Arkansas.
A spokesman for LM Wind Power referred the Free Beacon to the company’s website.
When LM Wind Power came to Little Rock, Arkansas, in 2007, it said it would employ 1,000 people by 2012. But the global economic crunch led to diminishing demand. Three months before its loan guarantee was finalized, LM Wind Power announced its profits had fallen 41 percent last year.
It really takes some amazing stones to grab a $32 million subsidized government loan on the promise to add 250 jobs just days before a planned 234-person layoff.
me:
Just another reason for why states should not play in the distort-the-markets business as a general rule. But then again, if politicians wouldn't slosh out huge amounts of money, they wouldn't get lobbied as nicely anymore, right?
August 18, 2012, 10:34 pmCharles Rice:
I'm not really sure it's stones.
August 18, 2012, 11:03 pmThe gov't agency has to make the loans to someone or it serves no purpose. The viable businesses get loans on the open market, I assume because the gov't loans have too many hoops to jump through or strings attached. So there is a market for these less loans sometimes filled by the most plausible liar. LM Wind is willing to play the game long enough to get the loan. The jobs and wind power is somewhat of a red herring, and everyone involved knows it. Just like Solyndra pretending to be a viable maker of solar panels, and Fischer Karma pretending to be a viable car company. They don't need to be real, they just need to have some hope of being real, or be real enough that everyone can say with a straight face "We had no idea it would work out like that! Who could have known?"
JVDeLong:
Making false representations to obtain government money is also a criminal offense.
Unfortunately, as CR notes, the situation is a conspiracy between the government agency and loan recipient, so the chances of action are small.
JVDeLong, Author: Ending 'Big SIS' (The Special Interest State) and Renewing the American Republic
August 19, 2012, 8:28 amJim Furey:
The simple cynic in me thinks that this looks to me like an opportunity to re-'hire' 250 employees, allowing the administration to tout a green success story.
August 20, 2012, 11:12 amMark2:
It is about jobs saved or created. So in this case the 250 jobs were saved. If the loan didn't go through presumably 500 jobs would have been lost rather than just 250.
Chalk up another +250 for the Obama administration.
August 20, 2012, 12:06 pmMark2:
Along the same lines. Last month we were told some 160K jobs were created last month (July, 2012), but if you look at the official unadjusted numbers 193K jobs were lost last month.
Now we see all these sad reports that in 44 states the unemployment rate seems to be up for July. Well no kidding we lost 193K jobs no matter how the statisticians try to cover it up.
August 20, 2012, 12:12 pmMark2:
The comments, They all DISAPPEARED! I guess I will have to wait the week to see them all again.
August 20, 2012, 2:45 pm