President Obama suddenly favors offshore drilling. A real breath of fresh air. But, there’s a catch. It’s not here, it’s in Brazil. He started with $2 billion and a promise to fund more. The money goes to Petrobras, the state-owned oil company. The country that is begging China to buy treasuries to cover our burgeoning debt load is doling out money to the country that has the biggest offshore oil discoveries in history and will mint money as the oil begins to flow.
What does this loan get us? Years of oil production at a specific price? That’s what China has been doing all over the world, including Brazil. Cash for long-term supply contracts with price escalators. No, ours is just a loan or a loan guarantee. More good will from the old USA.
We will drill offshore here now, right? The answer is maybe. Remember the million signature petition from Newt Gingrich to Bush that resulted in both candidates, McCain and Obama changing positions on this?
Interior Secretary Ken Salazar says he will open the Gulf Coast to lease sales on August 19. Not Alaska, not the east or west coast, but the Gulf Coast. Sales of these leases should bring in millions of dollars, but maybe not as much as we just gave Brazil.
Just when you thought cash might flow into the U.S. Treasury, you find it’s flowing out faster to another country that is growing rich by using offshore resources that they will probably sell back to us. Hell of a deal. Borrow money from Obama and then pay him back with the oil you produced with the borrowed money. And, if you are Brazil, smile as you watch your rich neighbor let their offshore oil sit fallow and grow poorer.
Maybe in 10 years Brazil can loan Obama’s successor a few billion to drill offshore in Alaska and the east and west coasts, since we will be out of money by then and out of energy as well.
