04/04/2012 10:57 am ET Updated Jun 04, 2012

Public Diplomacy With Brazil Puts Boeing Deal at Risk

Brazil's reluctance to help Washington topple Syria and their support for Iran's nuclear program have drawn the ire of a White House eager to turn foreign policy into political currency during a presidential election year.

Flexing its muscles, the Pentagon abruptly cancelled a deal with defense giant Embraer and the White House refused to give next week's visit by president Dilma Rousseff state visit status relegating the event to the lower category of bi-lateral talks.

Brazil is miffed that Washington has given leaders of other BRICS nations full state visit status, which include formal state dinners and other high profile events but have excluded Dilma, a former urban guerrilla who was jailed and tortured by a U.S.-backed military regime.

With the White House courting the Latino vote affluent Cuban-American voters and campaign contributors have shown concern over Dilma's ties with the Castro brothers in Cuba and Venezuelan leader Hugo Chavez, who provides Iran with a media platform to pump anti-American and anti-Israel propaganda into Latin America. Then too, some in the pro-Israel lobby that is close to the White House are worried that Brazil's relationships with Syria and Iran could cause some of its sensitive defense technologies to get loose.

How Brazil plays the rebound could impact on the fortunes of Team Obama's friends at Boeing since the president will use Dilma's non-state visit as yet another opportunity to help the global defense giant close a multi-billion dollar jet fighter deal with her government that could have a long term value of $30 billion.

Scratching the patina of inter-American dialogue the latest round of Brazil bashing has struck a nationalist chord among Brazil's political class. Apologists for Washington's efforts to win back the #1 trade partner status it lost to China are at odds with those who see Brazil's economic model providing an equal voice for emerging nations regardless of their politics or cultural heritage. Brazil is a major food supplier to Iran and other nations in the world of Islam as well as BRICS nations.

Brazil has also been offended by Washington's refusal to back it's bid for a permanent seat on the United Nations Security Council. The Obama administration instead is supporting Colombia, its most loyal ally in Spanish speaking Latin America. The United States provides substantial aid to, and maintains bases in Colombia that help provide political stability, support counterinsurgency operations and track the flow of drugs.

Boeing's global PR and lobbying operators have been aware that Brazil's air force has been clamoring to replace its aging fleet of multi-role jet fighters for years. Finally, in 2008, as part of a strategic alliance Brazil signed with France, former president Lula chose the Rafale FX-2 manufactured by Dassault. Brazil also inked a $4 billion contract with France to buy SK diesel powered submarines capable of nuclear upgrade. Meanwhile the Boeing lobby attempted to work around Lula as if the Rafale deal never took place, pressing their case for the F-18 Super Hornet with Brazilian politicians, diplomats and media influencers.

Lengthy negotiations over costs and technology transfer on the Rafale were complicated by Boeing publicizing counteroffers and White House criticism of French president Nicholas Sarkozy. Consequently, the deal was not completed when Lula left office and he passed the portfolio, and the decision, on to Dilma. As part of her strategy to move to the political center and expand relations with Washington she showed a preference for Boeing over the French plane.

President Obama lobbied for the Boeing deal during his state visit to Brasilia last year. He even presented Dilma with a joint communique from leaders of the U.S. Senate suggesting that Brazil buy Boeing. Brazil considered several other aircraft in the selection process, including, among others, Sweden's SAAB Gripen, the EADS Tornado and the Russian SU-35 Superflanker but none of these aircraft remained in the hunt. All of the aircraft offer excellent capabilites. But the Hornet and the Rafale have the best public relations.

To curry favor with Brazil's military and private sector aerospace industry, Boeing Brazil president Donna Hrinak on Tuesday announced her company's intention to open a small aerospace research center in the Sao Paulo area later this year. A former U.S. ambassador to Brazil and longtime shadow government player, Hrinak is no stranger to the lobbying game, timing her announcement on the eve of president Dilma's visit to Washington.

With Brazil's pride hurt by Washington's heavy handed public diplomacy there are new signs that Dilma could resist renewed White House pressure to buy Boeing during her other than state visit and opt for the Rafale or possibly save face and put the whole matter on hold.

In New Delhi last week for a summit of BRICS nations Dilma met separately with Indian officials to review costs associated with their deal to buy 136 Rafales raising the prospect that an India-Brazil consortium will bring savings to both nations that Boeing will struggle to match.

As global defense giants compete for market share in an uncertain economy, expensive PR and lobbying efforts have manufactured an artificial sense of urgency for Brazil to buy now. Playing the bad cop to help expand the global defense driven economy, Russia amped up the scenario by giving Venezuelan leader Hugo Chavez a sweet deal on a fleet of SU-35 Super Flankers, roiling the jet jockeys at Brazil's defense ministry.

In terms of mission relevance, however, prospects of supersonic dogfights between Brazil and Venezuela over disputed borderland are unlikely. And Dilma putting Hornets or Rafales on an aircraft carrier to help Argentina win its dispute with Great Britain over the oil rich Falkand Islands is even more remote. The political-psychological situation in a globalized Latin America finds Brazil's more immediate defense needs hovering closer to the ground.

Drug control and interdiction, counterinsurgency and anti-smuggling missions require sophisitcated radar, electronic battlefield technologies and low and slow aircraft. Food and water security, climate security and environmental operations require more sophisticated satellite and some black program technologies Brazil may be allowed to access only with approval from other governments. Cybersecurity and protection of Brazil's sophisticated electronic voting system are big ticket items that also figure into the mix.

Financing this defense spending is a challenge for Brazil. After nearly four years of insulation from the crisis of 2008, Brazil's economy is feeling the impact of the global financial meltdown. A slowdown in exports to Euro zone nations has been a factor in lower growth forecasts. Wage, transportation and food price increases are driving modeate inflation. And cheap labor from Bolivia and Haiti, legal and illegal, is quietly displacing Brazilians who do agricultural labor, mining, and menial and even high-tech assembly jobs.

To keep Brazil's economy and markets running smoothly and win reelection in 2014 Dilma and her economic team may need to do some extremely creative financing to avoid direct borrowing of dollars that are pawns in the ongoing currency war. While Brazil's needs are not urgent, they could serve as a test case for a recently discussed BRICS central bank that could provide credit facilities to assist member nations.

Damaging Brazil's pride and then expecting Dilma to buy Boeing Hornet jets is a classic example of the first among equals diplomacy Washington uses to dominate the Inter-American system. The Obama White House meanwhile turns a blind eye to a US companies that have sold sensitive software to Egypt, Saudi Arabia, and Sudan that enables them to track, arrest and torture digital democracy and open society activists. NPR Democracy Now journalist Amy Goodman has noted that Narus Insight, a Boeing subsidiary, develops and sells deep packet inspection software that performs tracking functions.

Reaching out on its Facebook page, Brazil's Ministry of Foreign Affairs asked people to offer their feelings about what message president Dilma should take to president Obama during their Washington talks. Whether it's making the right call or putting the jet deal on hold Brazil can throw some much needed sunshine on Team Obama's big double standard.