Obama pays for Offshore drilling in . . . . Brazil?

Why is the Obama administration giving money from the U.S. Export-Import Bank to a state owned oil company (Petrobras) in Brazil? If the Obama administration is concerned about the environment and they believe that offshore drilling is such a danger, why not stop offshore drilling anyplace. The WSJ:

The U.S. is going to lend billions of dollars to Brazil's state-owned oil company, Petrobras, to finance exploration of the huge offshore discovery in Brazil's Tupi oil field in the Santos Basin near Rio de Janeiro. Brazil's planning minister confirmed that White House National Security Adviser James Jones met this month with Brazilian officials to talk about the loan.

The U.S. Export-Import Bank tells us it has issued a "preliminary commitment" letter to Petrobras in the amount of $2 billion and has discussed with Brazil the possibility of increasing that amount. Ex-Im Bank says it has not decided whether the money will come in the form of a direct loan or loan guarantees. Either way, this corporate foreign aid may strike some readers as odd, given that the U.S. Treasury seems desperate for cash and Petrobras is one of the largest corporations in the Americas. . . . .

George Soros apparently owns has his largest holding in Petrobras.

The attacks on Palin is basically wrong (note also those mentioned in the Fox News piece). Here is a note on the taxpayer funding issue. The notion that the U.S. Export-Import Bank couldn't use their money to reduce taxes seems pretty important also. As to lending money so that American companies can bid on contracts, if the return from lending this money was so large, the companies would lend the money themselves to Petrobras.



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