In 2009, the celebration was on for an oddly-named company known as CH2M Hill. The engineering firm, performing the vast majority of the work at a cleanup project located on the Hanford Nuclear Site in eastern Washington, had just received word of a $1.96 billion reward in stimulus money for their services. The company immediately set about conducting job fairs and hiring 1,300 employees.
Feel good story of the stimulus, right? Wrong. More like a prime example of how stimulus funding was nothing more than a short-term band-aid for a long-term economic wound.
In the past couple of years, CH2M Hill has repeatedly announced layoffs that have met and exceeded the number of hires created by the stimulus, have slashed the pensions of non-union workers, and are currently demanding wage and benefit cuts from their union employees.
In January of 2011, specifically citing the drying up of stimulus funds, the Hanford nuclear site braced for a loss of 1,600 jobs, with 1,350 starting in September for CH2M Hill.
This past August, the company announced another 400 layoffs were imminent, informing members of the Hanford Atomic Metal Trades Council (HAMTC) union of the news.
All told, the Hanford site started 2011 with 12,000 workers, but lost about 2,000 nine months later. An article by the Tri-City Herald featured several interviews with people who had lost their jobs after stimulus funding had dissipated. Most understood that their positions were only temporary – meaning, they recognized that once the stimulus money had been thrown at the project, their jobs would be eliminated.
Why didn’t the government?
Not only was it temporary, but in the end was proof positive that the stimulus could not counter the effects of an ailing economy. CH2M Hill lost roughly a net of 700 positions – despite the hiring that came about after their hefty $2 billion reward.
Troubling waters for Hanford workers have yet to recede.
Just a few weeks ago, nearly 1,700 non-union workers at the Hanford site had their pensions cut, with benefits accrued being frozen for 2014, and the multiplier used to calculate pension benefits being reduced from 1.6 percent to 1.2 percent.
Union workers from the aforementioned HAMTC were spared such cuts – or were they?
At the end of November, labor negotiations between the HAMTC and CH2M Hill got testy, with the company proposing significant wage and benefit cuts for their workers.
Dave Molnaa, President of the HAMTC called the proposal “an insult to workers”, explaining that “the proposal will mean less money for workers and more money kept by the corporation”.
Why would a company that received nearly $2 billion in government funding need to eliminate jobs, eliminate pensions, reduce wages, and find ways to ‘keep more money’?
A Wall Street Journal report explains it best, perhaps. In discussing the CH2M Hill/Hanford cleanup projects, Tennille Tracy writes:
“… projects that employ people quickly are often considered ‘low-hanging fruit’ and can fail to set the stage for long-term economic growth.”
A microcosm of the entire stimulus experiment itself.
For sure enough, when the low-hanging fruit began to go bad for companies like CH2M Hill, when the stimulus funding ran out for projects at the Hanford site, all of those jobs—and then some—were eliminated.
We keep hearing about companies that received millions in stimulus funding, but only created a certain amount of jobs at an exorbitant amount. Yet CH2M Hill continues to fly under the radar, receiving billions in funding to actually lose hundreds of jobs.
Such waste. $2 billion in taxpayer money provided for temporary hiring, temporary funding, and a temporary patch on the economy – and you’ve probably never heard about it.
Cross-posted at FreedomWorks
Can somebody please explain to me what reason there is for celebrating another uptick in unemployment – to 7.9% – in America?
This tweet just came across from Scott MacFarlane:
And here is the picture:
“Today’s increase in the unemployment rate is a sad reminder that the economy is at a virtual standstill. The jobless rate is higher than it was when President Obama took office, and there are still 23 million Americans struggling for work. On Tuesday, America will make a choice between stagnation and prosperity. For four years, President Obama’s policies have crushed America’s middle class. For four years, President Obama has told us that things are getting better and that we’re making progress. For too many American families, those words ring hollow. We can do better. We can have real economic growth, create millions of good-paying jobs, and give middle-class families the security and opportunity they deserve. When I’m president, I’m going to make real changes that lead to a real recovery, so that the next four years are better than the last.”
Romney and most Americans see it as yet another sad day in a four-year struggle with the economy and unemployment.
Not the Obama administration.
Generation Opportunity, the largest non-profit, non-partisan organization in the United States engaging and mobilizing young Americans on the important economic issues facing the nation, announced non-seasonally adjusted (NSA) 18-29 youth unemployment rate data for October 2012 as the Presidential election nears:
- The youth unemployment rate for 18-29 year olds specifically for October 2012 is 12.0 percent (NSA).
- The youth unemployment rate for 18-29 year old African-Americans for October 2012 is 21.4 percent (NSA); the youth unemployment rate for 18-29 year old Hispanics for October 2012 is 13.4 percent (NSA); and the youth unemployment rate for 18–29 year old Women for October 2012 is 11.8 percent (NSA).
- The declining labor force participation rate has created an additiona1.7 million young adults that are not counted as “unemployed” by the U.S. Department of Labor because they are not in the labor force, meaning that those young people have given up looking for work due to the lack of jobs.
- If the labor force participation rate were factored into the 18-29 youth unemployment calculation, the actual 18-29-unemployment rate would rise to 16.5 percent (NSA).
Don’t worry though, things can turn around after Election Day.
In a press release to CNN, Romney reiterated his five-point plan to create a real recovery in America:
Together with Paul Ryan, I’ve put forward an economic recovery plan consisting of five central elements that will in four years create 12 million jobs.
We will produce more of the energy we need to heat our homes, fill our cars, and make our economy grow. We will stop President Obama’s war on coal, his disdain for oil, and his effort to crimp natural gas by federal regulation of the very technology that produces it. We will support nuclear and renewables, but phase out subsidies once an industry is on its feet. We will invest in energy science and research to make discoveries that can actually change our energy world. By 2020, we will achieve North American energy independence.
We will retrain our work force for the jobs of tomorrow and ensure that every child receives a quality education no matter where they live, including especially our inner cities. Parents and students, not administrators and unions, need to have greater choice. Our current worker retraining system is a labyrinth of federal programs that sprawls across 47 programs and nine agencies. We will eliminate this redundancy and empower the 50 states and the private sector to develop effective programs of their own.
We will make trade work for America. We’ll open more markets to American agriculture, products, and services. And we will finally hold accountable any nation that doesn’t play by the rules. I will stand up for the rights and interests of American workers and employers.
We will restore fiscal sanity to Washington by bringing an end to the federal spending and borrowing binge that in just four years has added more debt held by the public than almost all previous administrations combined. We will put America on track to a balanced budget by eliminating unnecessary programs, by sending programs back to states where they can be managed with less abuse and less cost, and by shrinking the bureaucracy of Washington.
Finally, we will champion small business, the great engine of job creation in our country, by reforming the tax code and updating and reshaping regulations that have suffocated economic growth.
What do you want America? A President who celebrates mediocrity in America, or a President who will bring back exceptionalism to this great nation?
A new report indicates that the Obama administration handed over half-a-million dollars to their media partners at MSNBC in 2009.
The funds were part of the taxpayer funded stimulus, and served to run commercials during the Rachel Maddow and Keith Olbermann shows, meant to recruit young liberals for the President’s failed ‘green jobs’ program.
The Labor Department paid out hundreds of thousands of dollars in federal stimulus funds to a public relations firm to run more than 100 commercials touting the Obama administration’s “green training” job efforts on two MSNBC cable shows, records show.
The commercials ran on MSNBC on shows hosted by Rachel Maddow and Keith Olbermann in 2009, but the contract didn’t report any jobs created, according to records reviewed recently by The Washington Times.
Spending reports under the federal Recovery Act show $495,000 paid to McNeely Pigott & Fox Public Relations LLC, which the Labor Department hired to raise awareness “among employers and influencers about the [Job Corps] program’s existing and new training initiatives in high growth and environmentally friendly career areas” as well as spreading the word to prospective Job Corps enrollees.
The administration claims that the decision had nothing to do with politics, but it certainly blurs the line of distinction between the main stream media and government. Is it any wonder Rush refers to it as the “State-run media”?
We’re looking now at a net loss of about 700 jobs.
CH2M Hill was granted roughly $2 billion in stimulus funds to clean up the Hanford nuclear waste site. The company used that money to setup a job fair and hire nearly 1,300 new employees. When the stimulus money ran out, so did the ability to employ those same workers – and then some. An announcement in January of last year predicted 1,600 people would be unemployed by September.
At the beginning of April, CH2M Hill received more government funding, this time in the form of a $1.3 million grant to assist those who were laid off.
To make matters worse, the President of the company, John Lehew, had to address rumors of even more layoffs in April. Those rumors transitioned to reality this past week…
The Hanford Atomic Metal Trades Council has been notified that 67 workers it represents will lose their jobs at Hanford as a result of a planned layoff by CH2M Hill Plateau Remediation Co.
In addition, 28 people responded to a request for volunteers for layoffs, bringing the total job cuts for workers represented by HAMTC to 95.
The layoffs have been expected. CH2M Hill announced in April that it would cut up to 400 union and nonunion positions in two phases. In the first phase, 58 employees were laid off in June.
That leaves up to about 340 layoffs possible in September, when the second phase of the job reduction will occur. The potential 340 layoffs include the 95 workers represented by HAMTC.
Nowhere is the reality of wasteful stimulus spending more readily apparent than in the case of a company like CH2M Hill. Jobs created by environmental cleanup projects and infrastructure spending, while a good idea at heart, are nothing more than temporary fixes that will not remedy the economic crisis.
We keep hearing about these companies that received millions in stimulus funding, but only created a certain amount of jobs at an exorbitant amount. Yet CH2M Hill continues to fly under the radar, receiving billions in funding to actually lose hundreds of jobs.
Why has CH2M escaped serious scrutiny? Perhaps it is the significant donations and lobbying efforts they have doled out, targeting key Democrats in charge of the stimulus. Perhaps it is the no-bid contracts, the influence they had in shaping the stimulus, or the revolving door of employees and White House administrative positions that have allowed them to continue their dominance in procuring government funding.
The Republican National Committee today released an e-mail from Solyndra CEO Chris Gronet from 2009, labeling the Obama administration as “The Bank of Washington” and boasting of several ways in which the company could exploit federal programs and tax breaks in order to keep the soon-to-be-doomed company afloat.
The opening of the e-mail reads:
The Bank of Washington continues to help us!
The rest of the e-mail (seen below) suggests ways to gather money from federal and state governments, and sounds eerily similar to a presentation given by Washington lobbyist Matthew Chiller. Chiller was employed by a company named CH2M Hill, and gave their employees a PowerPoint presentation on how to secure state and federal funding. The presentation provided employees with advice on congressional earmarks, and gave pointers on how to “work the earmark politically.”
What is the significance of the Solyndra/CH2M Hill relationship? My report last year outlined how CH2M Hill received nearly $10 million in stimulus funding to design Solyndra’s Fremont, California plant – a plant that exceeded $733 million just to build, and featured such amenities as Disney tune-whistling robots and elaborate spa showers for employees. Here is an excerpt from that report:
Within the $535 million loan to Solyndra were a number of sub-awards to other vendors, 40 payments of which were greater than $25,000 each. The largest sub-award went to CH2M HILL, to the tune of $9.6 million for their construction engineering services. CH2M used the nearly $10 million sub-award to design Solyndra’s solar manufacturing plant in Fremont, California.
John Corsi, the company’s Vice President of Media and Public Relations explains, “CH2M HILL performed some design services and helped with a technical engineering report.”
When asked about the price tag, Corsi stated that, “Our rates were consistent with market rates for similar work.”
He added, “This work was secured through an open, competitive, and transparent procurement process,” a contradiction to the aforementioned Washington Post report which stated that consulting firms had essentially shaped and awarded themselves pieces of the stimulus.
With millions of dollars having been secured, CH2M clearly outdid themselves on the Solyndra project, building a facility the likes that had never been seen before in the heart of Silicon Valley. The facility covers 300,000 square feet, ran a price tag of $733 million, and was equated by some to the Taj Mahal. Bloomberg News reported on some of the extravagant amenities—amenities which might surprise for a company using taxpayer funds to maintain operations.
“It wasn’t just any factory. When it was completed at an estimated cost of $733 million, including proceeds from a $535 million U.S. loan guarantee, it covered 300,000 square feet, the equivalent of five football fields. It had robots that whistled Disney tunes, spa-like showers with liquid-crystal displays of the water temperature, and glass-walled conference rooms.”
All on your dime.
While the company deflected any specific questions about building design, Corsi did state that, “The client (Solyndra) made all decisions regarding the final design specs.”
He added, “Any vetting of the relative merits of the project are the responsibility of the government.”
Another company that assisted CH2M Hill in the design of the Solyndra facility also declined comment. Erik Sueberkrop, of Studios Architecture, was on the design team for the manufacturing and office facility in Fremont, California. He stated only, “As I am not at liberty to discuss, there is no comment at this time.” The Studios website meanwhile, has scrubbed detailed links to the facility’s architecture, interior, and planning links.
While the building remained a feat of engineering, neither company saw fit to take credit now that the Solyndra scandal has broken. Each declined comment when asked to provide images or blueprints of the facility, and ignored a request to provide expense reports for the use of their stimulus money on the Solyndra project.
It would appear that both Solyndra and CH2M Hill executives did indeed work the earmark politically, and the “Bank of Washington” was more than willing to oblige.
In the wake of several Energy Department scandals it is important to analyze how taxpayer funded projects have developed, and what mistakes were made along the way. It is not a time to rush infrastructure funding in the hopes that temporary jobs will be created in an election year; it is a time to analyze where the funding is going, who is responsible for spending it, and how they will be held accountable for their actions. It is not a time to blindly grant multi-million dollar loans to companies that administration officials know will fail; it is a time to scrutinize the potential use of every dollar so they are not wasted. It is not a time for crony capitalism, but rather a time for competent capitalism.
Perhaps the case of Solyndra will serve to remind our government of a commitment to be responsible and restrained with the American people’s money.
Romney: President’s Practice of Rewarding Friends and Campaign Contributors With Government Money "Stinks to High Heaven"
Mitt Romney went on Fox and Friends this morning to discuss the President’s record of political payoffs, while the middle class suffers significant layoffs. Regarding Obama’s penchant for rewarding political allies with government funds, particularly the numerous examples that have been seen with rewards from the stimulus, Romney said the practice is flat-out “wrong” and “stinks to high heaven”.
Steve Doocy: “I read in the Washington Post this morning that you want to draw attention to Obama’s political payoffs versus the middle class layoffs where you say, if you are a donor to the Obama camp you are going to do just fine. However if you are in the middle class Governor, your camp says, you got to worry about your job.”
Mitt Romney: “There is no question but that when billions upon billions of dollars are given by the Obama Administration to the businesses of campaign contributors, that is a real problem particularly at a time when the middle class is really suffering in this country. I don’t know whether you watched over the weekend, the report that was in The New York Times about families really struggling particularly those that are single parents that are just having a hard time making ends meet. This is a tough time for the people of America. But if you are a campaign contributor to Barack Obama, your business may stand to get billions of dollars or hundreds of millions of dollars in cash from the government. I think it’s wrong. I think it stinks to high heaven and I think the administration has to explain how it is they would consider giving money to campaign contributors’ businesses.”
Here’s the video of that exchange…
We are but infants in the blogging game. But we’re celebrating anyway!
Six months ago, we started this blog with one very loud opinionated blogger and three followers. Today, we still have that loud opinionated blogger, but we’ve expanded to about four followers (Thank you Mom!) … (Dad, seriously, could you at least consider following?).
But that isn’t about to dampen our spirits here at the Mental Recession, as we celebrate our 6-month Blogiversary. Thus far, we’ve posted exactly 501 times during that span, and experienced over 162,000 page views in all, an average of over 27,000 per month.
Most importantly, we’ve had a lot of fun doing this. And we hope you have too. Please consider hitting the ‘Donate’ button on the right side of the page, and help support this site – we badly needs some upgrades to keep expanding.
And without further ado, here are the Top 6 Posts in Mental Recession History…
Bonus – Top 6 Referring Sites…
And special thanks to the following people for either helping to promote some of the work done here at The Mental Recession, or for providing advice and inspiration in continuing on this path…
Tabitha Hale, Michelle Malkin, Doug Ross, John Ruberry, Anita MonCrief, Maggie Thurber, Warner Todd Huston, All-American Blogger, Brian Garst, Tucker Carlson, John Brodigan, Caleb Howe, Bill O’Connell, Alexa, Smitty and the Other McCain, Melissa Clouthier, Nice Deb, Fausta, Sarah Rumpf, Noel Sheppard, Ali Akbar, Matt Sheffield, Ken Shepherd, Jon Henke, Accuracy in Media, Breitbart, NewsBusters, the Daily Caller, and many, many more…
Thanks, and we hope to see you here in another six months!
The Boston Globe is reporting on a Massachusetts solar company that received state loans under Governor Romney, and is now filing for bankruptcy. The Globe insists that this news means that Romney’s attacks on the President’s failed Solyndra investment have backfired, and are implying that it opens up the Republican presidential contender up to charges of hypocrisy.
A Lowell-based solar technology company that received $1.5 million in state loans when Mitt Romney was governor has filed for bankruptcy, opening the presumptive Republican presidential nominee to charges of hypocrisy.
Konarka Technologies disclosed Friday that it had filed for Chapter 7 bankruptcy protection and would fire its 80-member staff and liquidate its assets.
Romney has chided President Obama for investing $535 million in a different solar company that failed, and has insisted governments should not pick winners and losers in the private sector. He held a press conference at the Fremont, Calif., headquarters of that company, Solyndra, last Thursday, saying, “Free enterprise to the president means taking money from the taxpayers and giving it freely to his friends.’
The Washington Post has also chimed in, stating that this incident leaves him “vulnerable to criticism”.
What the media isn’t reporting on is some very obvious differences between the two solar ventures.
- Despite using the above quote about giving taxpayer money to his friends, the Globe fails to demonstrate any parallel with Romney, citing no evidence of Romney’s associations with Konarka. Whereas Solyndra has the George Kaiser/Obama direct relationship.
- The difference between the loans offered the two companies is vast. The $1.5 million in state loans offered Konarka represents less than 0.3% of the $535 million loan granted to Solyndra.
- Konarka paid back their loan according to CEO Howard Berke, while taxpayers will not be seeing their Solyndra investment returned anytime soon.
- Solyndra’s demise happened just over two years after receiving their hefty helping of government loans, while still under Obama’s term as President of the United States. Konarka’s bankruptcy is now being filed nearly a decade after they received their state money, and a full five years after Romney last occupied the Governor’s office in Massachusetts.
We covered CH2M Hill earlier today, as they have announced more layoffs in the wake of $2 billion in stimulus funding for a specific environmental cleanup project. While their layoffs are site specific and not widespread, a couple other companies aren’t so fortunate.
From Thurber’s Thoughts:
Following bad news over the weekend, another solar firm announces major restructuring moves, including layoffs, today.
First Solar (FSLR) was kicked off the Nasdaq-100 Monday and replaced by Texas Instruments. First Solar is based in Tempe, AZ, but was founded in Toledo under the name of Solar Cells, Inc. Their only U.S. manufacturing facility is in Perrysburg Township.
In October, they fired their CEO. In December, they announced 100 layoffs and a delay at their Mesa plant.
Today, they announced further changes, including closing operations and laying off 2,000 – roughly 30% of their workforce.
Also, Weasel Zippers has this…
More Layoffs At Obama-Funded Electric Carmaker Fisker Automotive, Delaware Plant Is “Absolutely Empty”…
I’m pretty sure we can kiss our $529 million goodbye.
Via AOL Auto Blog:
Last we heard, Fisker Automotive was still “committed” to building the recently revealed Atlantic sedan at the former General Motors plant in Delaware. A few years ago, Fisker announced that site would be the company’s new domestic production home (the Fisker Karma extended-range plug-in hybrid is made by Valmet in Finland). Still, Fisker did say that any definitive statement on the Atlantic’s production location would not come until the end of the summer.
So we were interested to read new reports from local media that show more signs that the Atlantic might not ever be built in Delaware. On Friday, Delaware Online reports, 12 more workers — including engineers and maintenance technicians — were laid off at the plant, leaving “only a small maintenance team” left there. One of those let go was Jeff Garland, who had been working on community affairs and business development efforts in Delaware. He said the plant is currently “absolutely empty.” This is because Fisker has taken out the old GM equipment but has not yet installed the machines it would need to build the Atlantic. As Garland told Delaware Online, “I think what happened was the budget numbers are so tight right now and they’re working so hard to preserve as much cash as they can that something had to give. We’re not making a car in Wilmington right now, so given that situation it was an obvious place to make a cut.
We must be heading for another one of those ‘Summer of Recovery’ things…