Big Government Spending Helps French Manufacturing Company Profit, Not Americans

I’ve been following what was once the feel-good story of a small town Minnesota business on the heels of revolutionizing energy efficiency in buildings. However, after the company received taxpayer funds as part of a federal loan development program, the company was sold to a French-based company. What happened?

Sage Electrochromics of Faribault, Minn. developed “smart glass” for windows. Smart glass electronically tints glass to adjust to sunlight conditions resulting in energy reduction. In 2010, Sage received more than $31 million in tax credits to help this business grow.

Through government program funding, Sage CEO John Van Dine noted, “Global market potential and energy savings are enormous. Sage aspires to be a global leader in a new glass technology.” Fast-forward to 2012.

Two years after receiving tax credits through a largely inactive federal program, French glass and building materials giant Saint-Gobain bought-out Sage. While the factory will remain based in Faribault, Minn., Saint-Gobain took over the company— taking with them the technology and potential. And, one year after selling his stocks of Sage, CEO Van Dine stepped down to “focus on more charitable efforts.”

The short of it, the government dumped millions into a taxpayer-funded program that failed. It was supposed to position a small Minnesota-based company as a global leader. Instead, the government provided tax credits to a company that is now owned by a French manufacturing giant.

And, it hits home.

The Mall of America recently announced that SageGlass panels will cover several thousand square feet of skylight space at the mall’s new entrance. With the company’s expansion now complete mostly due to federal support, it has the “capability to meet most architectural needs,” according to Derek Malmquist, a marketer for Sage Electrochromics. What does this mean? Big government spending has cost taxpayers millions, and has paved the way for a French-based company to use American technology and tools to gain global leadership and profits.


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