The Obama campaign spent the better part of the last week trying to make the niggling argument that Mitt Romney’s career in private equity didn’t necessarily speak to his abilities as a job creator, citing underwhelming employment figures from his tenure as Massachusetts governor. Over at the American Spectator, Jim Antle discusses why Obama’s attacks on Bain have been less successful than Ted Kennedy’s. The biggest reason? “Ted Kennedy didn’t have to run for reelection on Obama’s jobs record.”

If Romney’s record in private equity is mixed, Obama’s record in public equity is much, much worse. The predictable backlash from the Romney campaign has arrived:

They’ve latched on to a Republican Party talking point about First Solar, the ailing solar company that received about $3 billion in loan guarantees and is now laying off workers. That is, despite the company’s penny-pinching use of the Export-Import Bank to sell solar panels to itself.

The lion’s share of those loan guarantees went to two California solar panel farms named Desert Sunlight–the 2011 North American Solar Deal of the Year!–and Antelope Valley. They will create a grand total of 35 permanent jobs, according to the Department of Energy’s website.

The single biggest misconception of ads like the one above is that taxpayers are footing the bill for all these failed projects. There’s some truth to it, especially in the case of Solyndra, but it’s more complicated, and possibly more cronyist, than that. Financing for many of the DoE loan programs including Antelope Valley and Desert Sunlight was provided through something called the Financial Institutions Partnership Program, by which the federal government works with various third-party lenders. In the case of Desert Sunlight, that meant Goldman Sachs submitted the proposal, and Citigroup was the lead arranger. On September 29th the federal financing came through for both projects, and the next day news broke that NextEra Energy, the nation’s largest renewable energy firm, announced that they would buy up the Desert Sunlight solar farm from First Solar.

Both the lead lender and the eventual owner of the Desert Sunlight farm are companies whose CEOs sit on the President’s Council for Jobs and Competitiveness. It’s hard to know just how much insider wrangling went on, but it certainly looks bad.

There was a third loan guarantee in the works worth $1.93 billion for a project entitled Topaz Solar, but the federal financing was scuttled after an insider trading flap. Thankfully, at least for advocates of green energy, it was quickly bought by Warren Buffett.

But how did First Solar, chosen beneficiary of the federal government’s beneficence, go from doing billions in business with Uncle Sam in 2011 to being the “worst performing S&P 500 component of 2012?” From having a net income in 2010 of $664 million to a net loss of almost $40 million in 2011?

The answer is complicated, and the biggest factor is probably the continuing economic troubles in Europe, which have proved disastrous for green energy subsidies there. The company is also still paying millions for a “manufacturing excursion.” President Obama seems to think First Solar is failing because they’re being undercut by those nasty Chinese solar panel manufacturers. So he’s going to punish them with a big fat tariff, which would work against nearly every one of administration’s energy policy goals.

Obama’s embarassing record on public financing pretty well ensures that this is a losing issue for him. If Bain represents creative destruction in all its positive and negative aspects, the Department of Energy represents institutional entrenchment and cronyism in its worst form. But overly simplistic arguments about lost taxpayer money aren’t the best way to convince people.

Millman on Bain here.