Daily Archives: June 29, 2012

Another Link in the Chain?

Last week in New Jersey there was a bit of an uproar over an urban assault training session. Residents were woken by the sound of gunshots, helicopters, and bomb blasts. Needless to say they were pretty upset and flooded 911 with calls, only to later find out that it was a scheduled military drill.

The exercise wasn’t the first of it’s kind in the last several months. There was the very public event in Tampa recently, that involved foreign soldiers and a simulated hostage situation. In that case it was during the day and all the school children got to watch and cheer. A couple of weeks before that, however, there was a nighttime urban assault training at an abandoned Miami hotel, which not all of the neighbors were informed about. As in New Jersey, people were pretty upset. Your average American isn’t really used to being woken in the night to the sounds of heavy artillery.

These urban drills have been happening in many cities, as a matter of fact, though you may not have heard of them all. Recently they have been conducted in Chicago and Los Angeles as well as the three locations already mentioned above. This activity has some people concerned about what is going on and why.

This isn’t a new type of training, as it turns out.

Political Support for Energy’s Loan Guarantees

Several weeks ago, 127 House Republicans joined 155 Democrats to defeat an amendment introduced by Rep. Dennis Kucinich (D-OH) and Rep. Tom McClintock (R-CA) that would have shut down the Department of Energy’s Title 17 loan guarantee program. That’s the program that gave birth to Solyndra, which has come to symbolize the failure of the Obama administration’s crony capitalist policies.

Why would members of Congress, and Republicans in particular, continue to support this federal boondoggle incubator? A new paper from Cato adjunct scholar Veronique de Rugy that looks at the Energy loan guarantees explains:

One reason is it serves three powerful constituencies: lawmakers, bankers, and the companies that receive the subsidized loans. Politicians are able to use loan programs to reward interest groups while hiding the costs. Congress can approve billions of dollars in loan guarantees with little or no impact to the appropriations or deficit because they are almost entirely off-budget. Moreover, unlike the Solyndra case, most failures take years to occur, allowing politicians to collect the rewards of granting a loan to a special interest while skirting political blame years later when or if the project defaults. It’s like buying a house on credit without having a trace of the transaction on your credit report.

Veronique notes that most of the money for the loan guarantees issued under section 1705 of Title 17 have gone to large and established companies: