American Elephants

The Do-Gooders Line Their Own Pockets! by The Elephant's Child

Nearly a year ago, I wrote about Assistant Secretary of Energy Cathy Zoi, who as revealed by disclosure documents, has a huge financial stake in companies likely to profit from the Obama administration’s “green policies.”

She was previously CEO of Al Gore’s Alliance for Climate Protection, and left that job to serve as assistant secretary in charge of energy efficiency and renewable energy. It was a remarkable example of graft and crony capitalism. But we’re learning about how well the renewable energy and green jobs sector is doing.  Now, Zoi has announced that she will be leaving her post to go to work for George Soros’ new venture capital firm focused on green energy.

The DOE website says that Zoi “manages over $30 billion of American Recovery and Reinvestment Act Funds” (the Stimulus).  Her new job will have her working to secure “green energy” taxpayer handouts and subsidies.  This is another of Soros’ bright ideas.  By investing hundreds of millions of dollars into advocacy groups that lobby for increased energy subsidies, he now gets to be on the receiving end of all those billions of dollars of subsidies.  Tim Carney, excellent investigative columnist writes:

Zoi’s tenure at EERE was rife with conflicts of interest. Her husband, Robin Roy, is an executive at Serious Materials, a small window manufacturer that boomed when Obama came to office. First, Serious Materials benefited from free advertising by the White House: President Obama praised a new Serious factory in March – before he officially nominated Zoi – and then Vice President Biden made a public visit to a different Serious plant in April, just after her nomination but before her confirmation. Finally, Serious was also the first window company to pocket a stimulus tax credit – worth $584,000 – for investing in new equipment.

Zoi testified before the Senate Energy and Natural Resources Committee in favor of a HOMESTAR program, also known as cash for caulkers, which became another subsidy for Serious.

At the time of her nomination, the couple owned between them 120,000 stock options in Serious Materials, according to her April 2009 personal financial disclosure. She also owned at least $265,000 of stock in a Swiss company called Landis+Gyr that makes “smart meters,” high-tech thermostats that the administration has promoted for saving energy. Pro-free-market writer and lawyer Chris Horner described the conflicts of interest: “Clearly, DoE funding to encourage the adoption of ‘smart meters’ would very likely lead to much increased sales by Landis+Gyr — and a potential windfall for Zoi.”

It is an ugly story of corruption and conflict of interest, cloaked in garments of green that apparently absolve them from any blame. Taxpayers can blame them, but it won’t do any good.  You might remember when the next election comes around.

Cash for Caulkers Creates a Conflict of Interest! by The Elephant's Child

Remember way back when the War in Iraq began, and the media discovered that the company providing meals and laundry and putting up camps in Iraq was (gasp) Halliburton, and you know Dick Cheney used to be CEO of Halliburton and undue influence, crony capitalism, blah, blah, blah. The media desperately tried to find something untoward., but Mr. Cheney had severed his relations with the company which had a new CEO, and it was all a pack of nonsense.

So in the normal course of politics, each side keeps an eye on the other side for crony capitalism, favoritism, bribes and payoffs. It’s the way it is supposed to be, except the media is supposed to be an objective watchdog, which they have forgotten how to do.

The connections between the Obama administration and the unions seems to involve a number of those sins, and sooner or later, someone will write a book about the relationship. In the meantime, we have an interesting case of for-profit politics:

The Obama administration appointee who would run a proposed subsidy program dubbed “Cash for Caulkers” has intimate ties to a company that has lobbied for the bill and would profit from it.

Al Gore acolyte Cathy Zoi, the Energy Department official in charge of energy efficiency, has testified in favor of the caulkers bill, which the House passed last week. She would administer it if it became law and is married to an executive at a window company that has pushed for this legislation.

We have written before about Ms. Zoi’s troublesome potential to profit substantially from the activities she is supposed to administer.

The Chamber of Commerce — the embodiment of anti-government greed in Obama’s standard rhetoric — is lobbying hard for the bill, and has informed members of Congress that this will be one of the votes tallied on the chamber’s annual scorecard of lawmakers. Also working Congress in support of the measure are the National Association of Manufacturers, Dow Chemical, the Laborers’ International Union of North America, the contracting industry and the window industry.

With all these supporters, Obama and the credulous media will declare it’s a consensus, and so it must be good. But really, the bill just spreads the corporate welfare strategically. It’s corporate welfare because the companies that sell the windows, insulation and services the bill subsidizes can now raise their prices, because consumers’ price tolerance goes up. So the subsidy is split between the companies and the homeowner. Americans without savings or equity with which to afford new windows are out of luck, as are renters. But they still foot the bill.

Well.  Conflict of interest.  Corporate Welfare.  Crony capitalism.  As Timothy Carney says, “when government injects itself more deeply into the economy, opportunities for cronyism come with the territory.”  It is still deeply unseemly.  Ms. Zoi should go, or the program should go, preferably the latter.  What a dishonest scam.

Conflict of Interest or Crony Capitalism? Take Your Pick. by The Elephant's Child

Assistant Secretary of Energy Cathy Zoi, as revealed by disclosure documents, has a huge financial stake in companies likely to profit from the Obama Administration’s “green policies.”

Zoi was previously CEO of the Alliance for Climate Protection — founded by Al Gore — and left that position to serve as assistant secretary in charge of energy efficiency and renewable energy.  She manages billions in “green jobs ” funding.  Disclosure documents show that she is  in a position to affect the fortunes of her previous employer — former Vice President Al Gore — but she has large holdings in two firms that could profit directly from policies proposed by the Department of Energy.

Zoi and her husband hold 120,000 shares in Serious Materials,where he is  in charge of public policy operations, as well as stock options.  Zoi also holds between $250,000 and $500,000 in “founders shares” in Landis+Gyr, a Swiss “smart meter” firm.  She also still owns between $15,000 and $50,000 in ordinary shares.

Smart meters are electric meters that return information about customer power usage to the power company immediately and allow the power company to control the amount of power that a customer can consume.  Note that control is the key word.

Obviously, DoE funding to encourage the adoption of smart meters would lead to increased sales by Landis+Gyr and a windfall for Zoi.  And insistence on insulated windows will lead to increased sales by Serious Materials.  After all Serious Materials has received visits and endorsement by both the President and the Vice President — something their better-known competitors have not received.

This is what I have always understood to be called a conflict of interest.  John Stossel did a show on what he calls crony capitalism — featuring —  Serious Materials.  This is problematical.

As a condition of employment with the Obama Administration, while Ms. Zoi maintained her holdings, she promised that “she would not participate personally and substantially in any particular matter that has a direct and predictable effect on their financial interest” without obtaining a waiver first.  Uh huh.

People in government usually divest themselves of problematic investments. Given the often verbalized interests of the Obama administration’s Department of Energy it would seem impossible for her to avoid a serious conflict of interest.

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