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Talk about Google founders Sergey Brin and Larry Page's investments and the stimulus.
BrightSource Energy got $1.6 billion for a solar facility that is going to be built on federal land. They got a sweetheart land deal from the federal government. They received $1.6 billion, and the Google founders are two of the largest investors in that venture. What happens a lot of times with crony capitalism is you end up getting middle-class taxpayers, in effect, subsidizing the business ventures of billionaires. I think it is hard in any fashion to try to determine why that is a good thing or to say that is a good thing. They are obviously very, very smart. They took risks in developing Google. They got handsome rewards. And if they feel that they can have some more success in the energy sector or other sectors, let them. But, don't expect the taxpayers to subsidize your financial risk taking.
An interesting case is Salesforce.com, which hired the former Federal CIO Vivek Kundra and has boasted about getting a significant share of the Federal Cabinet to adopt cloud computing with Salesforce.com CEO Marc Benioff also acting as a bundler for the Obama campaign. Is that a matter of "all is fair in love and politics" or a big conflict of interest?
I think it represents a huge conflict of interest. Unfortunately all the incentives seem to be for corporations to continue to move in this direction. The big [losers are] the taxpayer and the company that doesn't like to play these sorts of games. The big winners are those that raise money for political candidates and play the game of hiring lobbyists. Salesforce is a good example of that.
Often times we like to think that government contracts are always sort of sealed bid contracts, but in reality they are often not because bureaucrats get to write the rules and say this is the kind of product we want, this is the kind of technology we want, and suddenly there is only one firm or maybe two firms that actually fit that bill.
It is hard to quantify the jobs created from the $840 billion spent. Is there any way to determine how many jobs were created and how much money was wasted?
If you look, for example, at the green energy jobs when you go to recovery.gov, you can [search] on certain projects, and they are required to report jobs created. And, you'll find that often times the numbers are amazingly low, extraordinarily low. I think that is where, again, people were sold a kind of bill of goods with green jobs. The reality is that green energy companies are not labor-intensive companies.
Where does this end? We are in a political election season. Is there any end in sight to corporate cronyism?
I am encouraged that it has become part of the public lexicon. The American people are increasingly aware of it. And they don't like it. They don't like it instinctively. And so, the old arguments that we need to do this in the name of energy independence or we need to do this in the interest of the name of protecting jobs are viewed as increasingly suspect. So, I am very encouraged that it has become much more a part of the debate than it was even six months or a year ago.