Finger pointing dominated the start of a House hearing this morning on bankrupt solar manufacturer Solyndra Inc., as lawmakers argued over how much blame the Obama and George W. Bush administrations should shoulder for the failed company that was given more than a half billion dollars in government support.

Energy and Commerce Committee Democrats and Obama administration officials pointed out that the loan guarantee program from which the Solyndra loan was drawn was created under Bush in 2005 and that Solyndra began the process of applying for its loan long before President Obama came into office. The Obama White House announced a conditional loan for Solyndra in early 2009 and finalized it later that fall.

"Much of the extensive due diligence on the transaction was conducted between 2006 and the end of 2008," Jonathan Silver, who oversees the loan guarantee program at the Department of Energy, said in a statement to the committee.

"By late 2008, Solyndra was considered by those involved in the DOE loan programs to be the project most advanced in the due diligence process. ... In fact, by the time the Obama administration took office in late January 2009, the loan programs' staff had already established a goal of, and timeline for, issuing the company a conditional loan guarantee commitment in March 2009."

Nebraska Republican Lee Terry decried what he said was the Obama administration playing a blame game. "If there's a crisis that occurs today," he said, "blame it on the past administration."

Republicans say they have a smoking gun showing that the Obama administration applied pressure to get the Solyndra deal done for political reasons

In early January 2009, in the waning days of the Bush administration, Republicans say, a DOE credit committee that was charged with reviewing the Solyndra loan found that the deal was "premature" due to questions about its underlying financial support.

Referring to Obama's much-quoted comments about "shovel ready" projects that would be funded by the stimulus law, Rep. Michael Burgess (R-Texas) said, "It appears that the shovel that this project was ready for was to bury it somewhere. Yet, it was resurrected."

Burgess then cited a DOE staff email, dated a little over two weeks after the credit committee finding -- and after Obama's inauguration -- that indicated the approval process was moving forward again.

Texas Republican Joe Barton and others pressed Silver and Office of Management and Budget Deputy Director Jeff Zients about what changed between the January credit committee meeting and a follow-up meeting in March when the panel moved ahead with the loan and a conditional loan was announced to much fanfare.

"I know that one thing that changed is that the president changed," Barton said. "Was it possible that one of the things that changed was political influence?"

Silver, who was not at DOE at the time, noted that the credit committee did not reject the loan on Jan. 9 but simply remanded it for further analysis.

More market analysis and due diligence gave federal officials enough confidence, he said, to move forward with the loan, which remained conditional until it was finalized the fall of 2009.

Ranking member Henry Waxman (D-Calif.) said some blame may fall at the feet of Solyndra executives themselves.

"I think the real question before us was whether the vetting was done appropriately and based on full representation by Solyndra of their economic viability," Waxman said.

Two top Solyndra officials have agreed to testify next Friday before the committee.

Restructuring deal at issue

In addition to the original loan guarantee, Republicans are also focusing on a later restructuring of the loan guarantee that allowed private investment firms to recover money ahead of the government in case of a bankruptcy.

Under the restructuring agreement, Solyndra's private investors were given priority over the government for the first $75 million recovered in the event of liquidation, subcommittee Chairman Cliff Stearns (R-Fla.) said.

"Documents reviewed by committee staff raise concerns about whether this deal was better for the taxpayer," he said.

Stearns has used the downfall of Solyndra to call for an end of the DOE loan guarantee program and funding for the renewable energy projects it was created to support (E&ENews PM, Sept. 13).

"In this time of record debt, I question whether the government is qualified to act as a venture capitalist, picking winners and losers in speculative ventures and shelling out billions of taxpayer dollars to keep them afloat," Stearns said.

Those comments earned a quick pushback from Democrats who believe such a move would be akin to throwing the baby out with the bathwater at a time when the United States is competing with other countries to develop renewable energy.

"Even if we conclude that bad judgments were made on the Solyndra loan, we've got to continue to work hard to develop and implement appropriate policies that give American clean energy innovators the support they need to make the U.S. a market leader into the future," said Colorado Democrat Diana DeGette, the subcommittee's ranking member.