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"No" on H.R. 2548, OPIC Reauthorization
May 8, 2014
NTU urges all Representatives to vote “NO” on H.R. 2548, the “Electrify Africa Act of 2014,” owing to a troublesome section of the bill unrelated to its title. Couched as a benign directive for the Administration to create a sub-Saharan Africa electricity development strategy, H.R. 2548 also reauthorizes a corporate welfare agency: the Overseas Private Investment Corporation (OPIC).
Often regarded as a “sister” of the Export-Import Bank (Ex-Im), OPIC provides taxpayer-backed direct loans, loan guarantees, and other forms of financing under the auspices of fostering U.S. direct investment in emerging economies. As with Ex-Im, these ventures can essentially sidestep the principle of “fair value” and expose taxpayers to significant potential risk while at the same time distorting markets and crowding out private and domestic investment.
Again, like Ex-Im, OPIC has rushed in where private capital feared to tread – backing Enron projects, supporting a luxury Ritz-Carlton hotel in Turkey, and providing hundreds of millions of dollars to SunEdison for solar plants in Chile and South Africa, even as private investors consider “green” energy increasingly unattractive. Proponents of OPIC claim that the agency is self-funding and taxpayers are protected against potential bailouts by a $5 billion reserve. However, OPIC’s current exposure is more than five times that amount, at $29 billion. For this and other reasons, OPIC has been marked for elimination in a “Toward Common Ground” report, authored jointly by NTU and the left-of-center U.S. Public Interest Research Group.
Roll call votes on H.R. 2548 will be included in NTU’s annual Rating of Congress and a “NO” vote will be considered the pro-taxpayer position.
If you have any questions, please contact NTU Federal Affairs Manager Nan Swift at (703) 683-5700