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Bankrupt Green Energy Firm Got Grants From Obama, Bush Administration

Republicans may smell blood from A123 Systems going belly up, but the firm has had bipartisan backing.

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The Obama Adminstration was hit today with the news that the green energy company A123 Systems, which received a $249 million government grant, filed for Chapter 11 bankruptcy protection. The failure of the company is expected to provide fodder for Mitt Romney in tonight's debate and his campaign has already called the bankruptcy "yet another failure for the President’s disastrous strategy of gambling away billions of taxpayer dollars on a strategy of government-led growth."

But the Bush Administration also gave the company two grants, albeit much smaller sums, of $100,000 and $750,000 and was cited by Bush Energy Secretary Samuel Bodman as a success story.

In a December 2008 speech, Bush Energy Secretary Samuel Bodman praised the green energy company and insisted a government grant was the reason for the company's success.

"In 2003, the DOE made an SBIR award to a young company called A123 Systems for a project called "an advanced cathode material for lithium-ion batteries, " Bodman said.

"While this company now has major private investors, on many occasions the company's founders have described this SBIR grant as their first source of outside funding. And the results - now just 5 years later - are remarkable.

Bodman added he personally visited the company to see firsthand the progress it had made.

"I've had the pleasure of visiting A123 Systems - located right outside of Boston - and I can tell you first hand that this company is doing terrific work."

In February 2007, then-President Bush did a photo-op with the company's CEO David Vieau on the White House lawn, inspecting a car with one of the company's signature high-power lithium-ion batteries.

"I firmly believe that the goal I laid out, that Americans will use 20 percent less gasoline over the next 10 years, is going to be achieved, and here's living proof of how we're going to get there," Bush said as he peered at one of the car's batteries.

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Andrew Kaczynski is a political reporter for BuzzFeed News and is based in New York.

Contact Andrew Kaczynski at

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