He really does have the, erm, "Midas touch," doesn't he?

The company got Stimulus money:

Evergreen Solar Was Hoping to Hire 90 to 100 People for Its Manufacturing Plant. "Evergreen Solar, the Marlborough-based maker of solar panels, also is hoping to hire 90 to 100 people at a manufacturing plant in Devens, said Gary Pollard, vice president of human resources. The plant, which opened last summer, is expected to employ more than 800 when it reaches full capacity." [Boston Globe, 3/6/09]

It also got Mass money:

Evergreen Solar Inc., the Marlboro clean-energy company that received millions in state subsidies to build an ill-fated Bay State factory, has filed for bankruptcy.

Evergreen, which closed its taxpayer-supported Devens factory in March and cut 800 jobs, has been trying to rework its debt for months. The company announced today it is seeking a reorganization in U.S. Bankruptcy Court in Delaware and also reached a deal with certain note holders to restructure its debt and sell off certain assets.

The company also said it will lay off another 65 jobs in the United States and Europe, mostly through the shutdown of its Midland, Mich., manufacturing facility. That would leave Evergreen with about 68 workers according to a headcount listed in the bankruptcy filing.

“Chapter 11 will provide Evergreen Solar with the ability to maximize returns for our stakeholders through the proposed sale process,” Evergreen CEO Michael El-Hillow said in a statement. “Importantly, we expect to continue our technology development without interruption during Chapter 11 and the sale process.”

Evergreen secured a $58 million financial aid package from the Patrick administration to help build the $450 million Devens factory. The state has been trying to recoup about $4 million in cash from the company, the once-promising poster child of the governor’s clean-energy economic agenda.

Nice "investment!" Next time, use your own money, Mr. President and Governor Patrick!

Yeah, I think we should leave investing to venture capitalists and private equity. There are plenty of green investing firms, both in Mass and on the West Coast. There's no reason to ask the government to pick winners and losers. If the companies cannot make it with willing investors, there's no reason to believe that they are economically worthwhile.

For a high risk investment, either the government loses our money, or the company makes it big in which case the government gives away the store to the politically connected.

By the way, I've heard that Perry has done a lot of these sorts of investments in Texas for the politically connected. I'm sure we will hear more about that soon.

Ray Jay wrote:By the way, I've heard that Perry has done a lot of these sorts of investments in Texas for the politically connected. I'm sure we will hear more about that soon.

Sometimes being pro-business means literally being so?

It's odd. 50 years ago, the USA was taking huge risks and 'choosing winners' when it invested massive amounts into getting men onto the Moon. Now solar panels are a step too far for the current generation it seems.

The phrase that comes to mind is 'poverty of ambition'

danivon wrote:

Ray Jay wrote:By the way, I've heard that Perry has done a lot of these sorts of investments in Texas for the politically connected. I'm sure we will hear more about that soon.

Sometimes being pro-business means literally being so?

It's odd. 50 years ago, the USA was taking huge risks and 'choosing winners' when it invested massive amounts into getting men onto the Moon. Now solar panels are a step too far for the current generation it seems.

The phrase that comes to mind is 'poverty of ambition'

There is nothing noble about trying to foist a technology on people that can't compete in the marketplace--or even come close. That's what was happening here.

No way ... I totally support private ambition ... there's just no reason for the public sector to choose winners ... it's not good at that. There are plenty of alternative energy opportunities in this country, and plenty of entrepreneurs and venture capitalists working on it. We just don't need Massachusetts or Texas or Washington choosing our winners.

I also fully support the space program, especially unmanned missions ...frankly, it's the only thing that I was worried about when they were talking about the shutdown ... I'm glad that Juno launched.

This is the sort of thing tor which you can make the case for government spending.

http://www.kurzweilai.net/gold-nanopart ... dium=email

Gold nanoparticles boost organic solar cell efficiency
August 17, 2011 by Editor

University of California, Los Angeles (UCLA) researchers and colleagues from China and Japan have discovered that by incorporating gold nanoparticles into organic photovoltaics they can enhance solar power conversion by up to 20 percent.

It is generally worthwhile for the US to invest in basic research.

However, a big part of our current problem is that the US invests in companies that are in intermediate stages of technological development. Ethanol is a good example of this. While it would be very valuable to get fuel from plant matter in general, and we will get there eventually, it is not valuable to get fuel from food. But the US invests in ethanol in a big way on the theory that it is a transitional step.

We should invest in basic research, but we should not pick corporate winners and losers. Typically, the private sector can do that very well. By investing in business before the technology is economically viable on its own, we actually delay the onset of the advanced productive technology, because the incumbent player who is getting US funds for the intermediate technology has a vested interest in preventing the new technological development because it will out compete him and show the folly of continued government funding of the intermediate technology.

Bill Gates makes this point much more eloquently that I do here.

ray

I also fully support the space program, especially unmanned missions

Including the way NASA chooses companies that win or lose contracts ? Including the way NASA built some companies throught their vendor relationships?

A blanket statement like the government shouldn't choose winners or losers ignores the way competition exists in business. And the government, when it conducts business should conduct business as effectively as possible. Whcih means things like choosing winners and losers. If the military was more efficiently run, instead of awarding cost plus contracts to cronies, you'd have enormous savings. For instance.

And ignoring the way most countries, including the US, have had their govenrments involved in the development of nascent industries successfully willfully shuts off one avenue of economic development to the nation. The numbers of industrioes developed in Taiwan, South Korea, Singapore and China by government investment are legion. And they own many industries now that were once American. You want the US to compete with industry globally while shutting down one strategy that is used successfully against American industry constantly.
The solar panel business itself was developed in the US and moved to China. Would it be picking winners and losers to establish a trade policy that levelled the playing field so that American workers could compete with Chinese without lowering their working conditions, the environmental footprint of their factoies and their wages to that of china? Or would that be acting in the best interests of the domestic economy, and the tax payer?

There are loads of examples within the US where initial investment by government established industries that later became fundamental players in the economy. And some, like the ethanol industry, where they continue to be propped up long after they should have been cut loose. I guess Iowa's prominence in the electoral cycle has lead to that eventuality.Another might be the new major oil pipeline being discussed. The source of the oil that will be carried in that pipline was developed only becasue of initial govenrment involvement and investment...

The problem with Solar is that everyone thinks it should become a part of the energy requirements through access and provision to the grid. Where solar has the ability to really thrive is in lowering grid use by providing off the grid power to local users (the owners of the solar panels..) ... Too much has been spent trying to make it a mainstream component and its transmission isn't fundamentally economical. And that is neither a government nor private sector problem. Thats conventional thinking versus uncoventional.

Ray

We should invest in basic research, but we should not pick corporate winners and losers. Typically, the private sector can do that very well. By investing in business before the technology is economically viable on its own, we actually delay the onset of the advanced productive technology, because the incumbent player who is getting US funds for the intermediate technology has a vested interest in preventing the new technological development because it will out compete him and show the folly of continued government funding of the intermediate technology.

Bill Gates makes this point much more eloquently that I do here

.

This is interesting. Where is the link? Its especiually interesting because Bill Gates company particularly benefitted from being chosen by a govenrment agency

Ricky, you need to read more carefully, and think before you post.

I'm reading as carefully as I can. You refer to an elequent point made by Bill Gates...
Where is it?

Ricky:

Including the way NASA chooses companies that win or lose contracts ? Including the way NASA built some companies throught their vendor relationships?

A blanket statement like the government shouldn't choose winners or losers ignores the way competition exists in business. And the government, when it conducts business should conduct business as effectively as possible. Whcih means things like choosing winners and losers.

This demonstrates your basic confusion. The topic is about the government investing in a company. It is not about the government purchasing products. Yes, the government buys paper and has to choose the right paper company. Maybe it's Dunder Miflin, maybe it's Staples. But that's not what we are talking about. We are talking about Mass. and the US investing in a company that has a decent technology, but ultimately, even with that help, the marketplace determined that they were on the wrong track. The government wasted my money for temporary stimulus. Meanwhile, they raised my sales tax rate and increased my income tax rate to pay for it.

It didn't invest in solar as a matter of industrial policy. It invested in a particular solar company because they convinced government officials (who don't know a whole lot about solar technology and venture capital) instead of focusing on an appropriate business plan.

ray

This demonstrates your basic confusion. The topic is about the government investing in a company

Here's your basic confusion.
When the government provides a contract to a company, say IBM, to research and develop a control systems for say ICBMs... they are making a purchase decision and investing in the future of the company. Early stage contracts, especially for those where the product, service or equipment os in notional stages and still needs to be finally delivered, are often essentially the same thing as an investment and they certainly choose winners and losers when they make these commitments. Gates should know, since he benefited when IBM selected his OS for their machines which they developed specifically for the Government.
The same thing for things like transportation. The first contracts for plane models are often made at the predesign stage by governments.. Only if successful are they then sold as an off the shelf item. Another example? A Dutch company specializes in setting up plants that compost entire cities worth of green waste. They got their start when their national govnrment funded the intilal research, built out and final genesis models... Then they managed to take the concept and turn it into an export industry for the Netherlands.

When governments make early stage investments in companies, they are generally doing so because without their investment there wouldn't be an industry in their region or country. Sometimes its because the start up costs to develop a local resource is too much, sometimes, because the size of market required to make an industry profitable doesn't exist yet. But they do so because they want to establish an inudstry for the long term good of their citizens.
Sometimes their investments are not successful. Sometimes they are wildly successful. But often, without the risk taken by the govenrment the industry would never become established, and the successful industries usually grow well past their sphere creating knowledge and cultural networks (industries develop cultural and institutional knowledge bases in their work forces) .
Ask South Korea if without the major investment in their various internet and computer hardware and software companies by the government if they'd be major exporters today....
I would agree with you that the solar power project may be misguided, but more because of the concept than the intent. And I don't believe that once an industry is functioning that the government retains an interest in any of the competing companies... Indeed their exit strategy should usually be to create two or three competitors from their stake .

One thing about failed govenrment investment, is that it at least is creating experienced work forces... and although those solar plants might be producing energy that is too damn expensive when transmitted thru the grid ...it may put to work unemployed technicians who apply their experience and knowledge learned in thie failed enterprise to something that does become successful. Without the economic activity generated you might never have that potential spin off.
And by the way, there's a lot of private operators who failed to make solar pay either... It ain't a uniquely government centred piss pot.
I've got a lot of worthless shares from an alternative power start up that crashed and burnt without the sniff of government involvement...

So, why do you think the government invested in Evergreen Solar, as that is what we are talking about.?

Ray you said: Which hardly limits your thinkiing on this to just the single project Steve linked.

Yeah, I think we should leave investing to venture capitalists and private equity

So you used the example of Evergreen as evidence that all investment by the govenrment is wrong.
I won't defend the particular deal in Mass, and probably couldn't if I tried. (except for the "it put some people to work angle) But the broad brush, the "its always wrong" ideological nonsense that Steve ascribes to doesn't work with government investment all the time....

Balance your view of the failures with the successes...
If I took one example of a private equity investment that failed, and used that to demonstrate that all private investment is doomed to fail, I'd be as wrong as you.
The ideological nonsense that pervades the conservative movement in the US, fails to acknowledge the success that conservatioves have been part of in the past in the US, and in other countries where govenrments suceeded in their goals with early stage investments.
The almost total abandonment of US govenrment invovlement in an industrial strategy (from the 80s) with goals that include the development of an American labour force and an industrial platform are part of the reason the current deficit situation arose. When blanket statements and manic ideologies persist in eliminating strategies from consideration that are often (but not always) successful, you severly handicap the development of practical solutions.
Reagan, the guy who lowered then raised taxes when his deficits got too big, also reversed himself on US Government involvement in industry when he formed Sematech (50/50 gov private) to save the US semiconductor industry.
But if he treid to do that today, there's an air of simplistic ideological solutions that would have meant he couldn't have done that. The House would have blocked funding... And all your semi-conductors would be made in Japan, South Korea or China. Where governemtns invested in the industries before they existed in their countries. And when there was virtually no domestic market in their countries. And where private capital would never have ventured because the pay off was 15 years down the road....
(By the way, thats another reason why government investment is sometimes required. Particularly where private capital demands short term rewards that aren't possible when founding industries. Say the Oil Sands in Alberta,...)

Sematech is a consortium of companies. Evergreen is a single company.