Cash for caulkers invites for-profit politics

Significant Freedom Foundation of Minnesota research was cited in Timothy Carney’s column in the Washington Examiner on a top energy official, the “cash for caulkers” program, and how she would profit from a company that has lobbied for the bill. The article ran in both the Washington Examiner and San Francisco Examiner.

Cash for caulkers invites for-profit politics

By: TIMOTHY P. CARNEY

Examiner Columnist

May 12, 2010

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. Zoi, formerly chief executive officer of the Gore-initiated Alliance for Climate Protection, also owns stock options in Serious Windows.

The massive lobbying army backing the caulkers bill, and the conflicts of interest bubbling up behind the scenes, is one more hole in President Obama’s sinking claims of being a good-government reformer and a scourge of the special interests.

To portray himself as a reformer, Obama typically frames policy debates as questions of “whose side” you’re on: the American people’s side, or the side of Wall Street, the lobbyists or the special interests. This handily excuses Obama from defending his policies on the substance, while painting critics as corrupt stooges.

In real life, though, most legislative debates pit one company or industry against another. But on the rare occasions that all the special interests are actually unanimous — when Big Business of all stripes breaks bread with Big Labor to feast on the wealth of the hapless taxpayer — Obama is invariably on the side of the Big Guys against the future generations who will foot the bill. This was true in the Wall Street bailout, the Detroit bailout, the stimulus and Cash for Clunkers.

Today, Obama, Big Business, Big Labor and the environmental lobby have teamed up against your children for the $5.7 billion Cash for Caulkers program. The legislation would create the supposedly temporary “HomeStar program,” in which the government would cut checks to homeowners who pay for weatherization improvements such as new windows, insulation or ductwork repairs.

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.

And corporate welfare inevitably raises the specter of conflicts of interest. Which brings us to Zoi, who is assistant secretary of energy for “Energy Efficiency and Renewable Energy.”

The Freedom Foundation of Minnesota, a free-market nonprofit, revealed in a study that there are some conflicts here. Zoi’s husband, Robin Roy, is vice president of “Projects and Policy” at Serious Windows, a company that makes very expensive and very energy-efficient windows. The energy savings of its high-end windows might not pay for the windows’ premium price — but with a federal subsidy it will. In addition to helping her husband’s company, Zoi — by supporting and implementing Cash for Caulkers — will be boosting her stock portfolio. She owns 120,000 shares of parent company Serious Materials in vested stock options and an additional 32,500 options not yet vested. The value of these options is unclear, but it’s undeniable that Zoi and her husband get richer when the government subsidizes Serious Materials.

The Freedom Foundation’s interest in Zoi and Serious Windows began last year, when Obama and Vice President Biden both praised the company publicly on separate occasions, and Serious Windows’ CEO was called on to introduce Obama at an event.

One need not posit corruption by Zoi and Roy to see that something unseemly is going on here. But when government injects itself more deeply into the economy, opportunities for cronyism come with the territory.

Timothy P. Carney, the Examiner’s lobbying editor, can be reached at tcarney@washingtonexaminer.com. He writes an op-ed column that appears on Friday.