Sponsored by India-based Reliance Power, the mine and refinery (called the "Sasan project," named after a nearby village in the state of Madhya Pradesh) would emit more than 26 million tons of carbon dioxide per year -- more than all the direct emissions from Exim Bank's 2009 projects combined. Many additional co-pollutants would also be produced, including lead, arsenic, mercury, smog-causing nitrogen oxide, and acid-rain forming sulfur dioxide.
Three weeks ago, the Exim Bank's board rightly voted to reject this project due to the environmental damage it would cause. But Wisconsin-based Bucyrus, a company that will benefit from the deal, retaliated with a media offensive and major bout of political lobbying. Bucyrus claimed that it would not be able to sell its equipment to the project if Exim failed to provide the project with U.S.-taxpayer-backed loan guarantees. The timing was exquisite. Coincidently, President Obama visited Racine, Wisconsin, for a pre-scheduled town hall meeting the week after the Exim board's vote. If the president wanted to avoid an embarrassing scene, he'd have to strike a deal and backtrack on the Exim decision. Literally hours before Air Force One was scheduled to land in Wisconsin, Exim Bank invited Reliance Energy to resubmit its application.
According to Wisconsin Governor Jim Doyle, President Obama's involvement was "absolutely critical" in producing the Bank's flip flop. But the president wasn't the only one involved; Bucyrus CEO Tim Sullivan gave props to Doyle as well as Senators Herb Kohl and Russ Feingold and Representatives Gwen Moore, Paul Ryan and Jim Sensenbrenner for pressuring Exim to change its mind.
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