For months, Republicans have argued that political pressure from the White House may have been responsible for the government's loan to Solyndra, the now-infamous failed solar power company.
But a new book uncovers another glaring example of political pressure under President Barack Obama's stimulus plan, and in this instance, the loan was ultimately rejected.
Michael Grunwald, Time Magazine's national correspondent recounts the startling story in his new book, The New New Deal, where White House senior adviser Valerie Jarrett applied pressure to try to secure a loan for USEC, an uranium enrichment company.
The company, which was once run by the government, wanted a loan for a nuclear fuel plant in Piketon, Ohio. Matt Rogers, a management consultant in charge of the Energy Department's stimulus money, didn't think the company was fit for the loan.
Rogers pointed out that even if USEC got the loan, the company would not have enough money to complete the plant. This was a big red flag, Grunwald writes, as deals should "cover the cigars for the closing dinner."
But not granting the loan was problematic for the president, who had promised to support the Ohio plant during his campaign. So after Rogers rejected the loan, he was called to the White House's Situation Room to explain his decision to Jarrett. (This may sound like an extreme use of a room normally reserved for monumental issues, but Grunwald points out the Situation Room is sometimes used as an ordinary conference room.)
Grunwald relays the conversation from the Situation Room:
"You realize the president made a campaign promise?" Jarrett asked.
Yes, Rogers did.
"Well, if you're sure, you're sure," Jarrett said. "But you better be sure."
Pressure from Jarrett is a powerful thing. The New York Times recently described the senior adviser as "a tenacious White House operator" with "unmatched access to the Obamas" whose "persuasive power [is] only amplified by Mr. Obama's insular management style."
Despite her persuasive power, the loan to USEC did not go through.
In an event for his book at the New America Foundation Monday, Grunwald said the pressure Jarrett put on Rogers was clearly "political" and "inappropriate." He also said he was suprised the story had not started a congressional investigation.
A lengthy Republican National Committee piece on Grunwald's book—which highlights Obama's stimulus failures despite Grunwald's largely positive message—does not mention the Jarrett incident. Grunwald thinks he knows why.
"I assume it's because USEC is John Boehner's and Mitch McConnell's favorite company," he said. USEC operates in Kentucky, where McConnell is a senator, and the nuclear fuel plant was to be in Ohio, where Boehner is a congressman.
Both lawmakers have criticized the White House for not approving the USEC loan, perhaps without knowing Jarrett did her best to see it through.