Little-Known Gov. Bank Gave $34 Billion to Overseas Fossil Fuel Projects Under Obama’s Tenure
Boeing, General Electric, and Exxon Mobil among the beneficiaries, says researcher Susanne Rust
KIM BROWN: Welcome to The Real News Network in Baltimore. I’m Kim Brown. An investigation by Columbia Journalism School’s Energy and Environmental Reporting Project has found that the Export-Import Bank of the United States, which is an obscure agency within the federal government, has spent billions of dollars on the financing of fossil fuel projects under President Obama, more than under any previous president. So, does the spending undercut President Obama’s climate change legacy and the gains expected from the implementation of its policies, such as his Fuel Efficiency Standards, and the Clean Power Plan? Well, with us to discuss this is Susanne Rust. She is the Director of the Energy and Environmental Reporting Project at Columbia University’s Graduate School of Journalism, and she is an award-winning investigative reporter. She joins us today from New York. Susanne, thanks a lot for being here.
SUSANNE RUST: Hey, thanks for having me. I appreciate it.
KIM BROWN: Susanne, first give us some background on the Export-Import Bank of the United States. It’s sometimes referred to as EXIM. Is this a separate government entity or agency? And what does EXIM Bank do?
SUSANNE RUST: It is part of the Executive Branch, although it operates independently, meaning that the president doesn’t actually say, “Here’s what you need to invest in,” right? They’re sort of their own entity, although they exist, again, within the Executive Branch.
They were created in 1934 by Franklin D. Roosevelt to stimulate job growth in the export and import industries, and so it’s been around since then. And the idea is that they will provide financing to different exporters within the United States to export their goods overseas, and they do this through insurance policies, working capital, direct loans and loan guarantees.
KIM BROWN: Let’s take a look at what President Obama has to say about his legacy on climate change.
BARACK OBAMA: Well, the good news is, during the course of my presidency, I think we’ve solidified in popular opinion the fact that climate change is real, that it’s important and we should do something about it. Translating concern into action is the challenge.
KIM BROWN: How directly linked is the Bank’s activity to the Office of the President, as you mentioned it is within the Executive Branch. But would he be apprised of its activity?
SUSANNE RUST: Presumably, he knows grandly what they are doing. Whether he’s… I doubt… I know he is not watching them day-to-day-to-day. However, he’s been a huge supporter of the Bank, although he wasn’t before he became President. As a Senator, he was opposed to the Bank. But when he became President he became a supporter, and actually, called for them and others to boost exports after the recession in 2008. In 2010, in the State of the Union, he called for the country to — well, he pledged to the country — that he would try to double exports over the next few years, and the Export-Import Bank was a part of that plan.
KIM BROWN: Susanne, you and your team spent several months analyzing tens of thousands of bank transactions released under the Freedom of Information Act. You interviewed dozens of sources and examined scores of government watchdog and academic reports. What did you find that undercut the President’s environmental legacy, and what are some of the examples of the projects that were most damaging to the environment?
SUSANNE RUST: When we started looking through it, it was honestly quite surprising to see how many projects — actually, not really the number of projects but the amount of financing that was going overseas during his tenure to fossil fuel programs. We calculated $34 billion went to overseas fossil fuel projects. These included coal plants — two of the largest coal plants on the planet — as well as new LNG plants, refineries, petrochemical complexes, and we went to the Bank once we looked at all of these, and asked them, “How much are these plants emitting every year?” So, when you get them all operating, how much will they put into the atmosphere in terms of greenhouses gases? And we came up with the number, 164 million metric tons — it was quite a surprise.
Some examples, as I mentioned, were the two coal plants. There’s Kusile, which is in South Africa, and Sasan, which is India. They both dwarf any coal plants that we have here in the United States. In addition, we found two liquid natural gas plants that the Export-Import Bank under Obama’s tenure were building on an island in the Great Barrier Reef, and many, many more.
KIM BROWN: They were building something in the Great Barrier Reef, which is supposed to be a protected environmental area?
SUSANNE RUST: That is correct.
KIM BROWN: Indeed. Susanne, at one point in your report you quote Senator Richard Shelby, who’s a Republican from Alabama, he’s also the Chairman of the Senate Committee on Banking, Housing and Urban Affairs, and who you say refused to hold hearings for new board appointees, saying that he will, quote, “Will continue to fight against any Congressional action that will allow the Bank to resume its role as an engine of corporate welfare,” end quote. Who are the biggest corporate recipients?
SUSANNE RUST: If you go to the story, we have a list of the top 10 corporate recipients, but they include companies like Boeing, Caterpillar, General Electric, ExxonMobil, Royal Dutch Shell — so quite large multinational companies.
KIM BROWN: At a certain point, there was a shift in funding to greener projects and away from coal-powered projects. Talk about that shift and what came out of it.
SUSANNE RUST: There indeed was. Back in, I believe, it was 2008 some environmental NGOs got together. They were concerned about the Export-Import Bank just giving to fossil fuels overseas, fossil fuel programs, and requested that they begin to also fund green programs overseas. The Bank said they would. They would try to do 10% of all authorizations to green projects overseas. They never were able to meet that quota, in large part because there just is not that much here in the United States to export overseas, but they have financed wind energy, solar and geothermal overseas.
KIM BROWN: Looking at your investigation as a whole and the activity of the EXIM Bank under President Obama, the spending that you’ve recorded, does it undercut his climate change legacy, in your opinion?
SUSANNE RUST: I think it does. When we looked at this, what was so striking was the amount of overseas financing for fossil fuel projects that happened during his administration. It dwarfs any president before. As I said, and you may have mentioned at the beginning of this, he spent more — or the Bank spent more — on overseas fossil fuel financing than Ronald Reagan, Bill Clinton, George H. W. Bush — you combine those three, he spent more than they did, more than double what they did, and three times more than George W. Bush.
So, yes, I do think it undermines. The other thing we did was when we looked at the greenhouse gases that are emitted annually every year from these programs, we decided we wanted to see what he had done here domestically, because he has been very vocal about his concern about the climate. He has called it terrifying. He’s turned it into a moral issue. And so, we wanted to see what has he done domestically, and compare that to these overseas emissions. And what we were able to calculate is that, according to the Energy Information Administration, if you were to look at the Clean Power Plan over the next 15 years, if it were to be implemented, it would save the atmosphere something like 2.5 billion metric tonnes of carbon dioxide every year. That’s almost exactly the same amount that these projects will emit over the next 15 years, assuming they’re all running at the same time and at full capacity.
KIM BROWN: Susanne, this is stunning information. What’s the name of the report? I know it was published in The Guardian US, right?
SUSANNE RUST: It was published in The Guardian US, and the first story is called, “How Obama’s Climate Change Legacy is Weakened by US Investment in Dirty Fuel”.
But we have two stories. There’s a second-day story where we had correspondents go across the globe and actually visit three of these sites, one in India, one in South Africa, and the one in Australia.
KIM BROWN: Well, you can find links to these articles right here, underneath this interview, and be sure to click on and read those. We’ve been joined by Susanne Rust. She is the Director of the Energy and Environmental Reporting Project at Columbia University’s Graduate School of Journalism. She’s also an award-winning investigative reporter. Susanne, thanks a lot for you work and we appreciate your reporting here with us on The Real News.
SUSANNE RUST: Thank you. Thanks for having me.
KIM BROWN: And thank you for watching The Real News Network.