The Solyndra Government

The problem I have with the demise of Solyndra is not that our government invested in a company that failed but that the failure is emblematic of a failed decision making process that transcends this investment. Unfortunately for everyone according to the Post politics played a key role the decision making process both in the case of Solyndra and other green technology projects. The same criticism of politics playing key role on the decision making can be made for the 2009 stimulus plan and the Affordable Care Act. Both of these signature legislative pieces for the Obama administration succeeded in satisfying the Democratic base but severely underperformed expectations regardless of your political viewpoint. You would think that we would start learning from our past mistakes. It doesn’t seem so. Recently I saw Paul McCulley on Wealthtrack make the argument that macroeconomics is a black box and that higher government spending will necessarily result in higher gross domestic product. Although he probably will loath the comparison, our government has a bad investment streak going and we have painted ourselves into a financial corner. It is probably time to cut our losses and make sure that our future investments are really, really good. You would think a former senior partner at PIMCO would know a thing or two about working out of a losing streak. I doubt his former colleagues at PIMCO would give him much sympathy if he explained that his bad investments were due to the bond market being a black box. Let me paraphrase something Alexander Pope said a long time ago, the best government is the government that works.