Report to the Nation

Into Rio's Palacio Tiradentes one afternoon this week strode well-groomed Professor Pereira Lira, President Eurico Gaspar Dutra's personal counselor. He carried a heavy, leather-bound pile of papers, which he placed on the speaker's desk in the Chamber of Deputies. To the opening session of the Brazilian Congress the president had sent a 130,000-word message on the state of the nation.

Ex-soldier Dutra, the honest plodder who had faced one crisis after another in three uneasy years as president, gave a good account of himself. He had balanced the 1947 budget and had $25 million left over (he was $141 million in the red in 1946). Moreover, Brazil's inflation--one of the worst in South America--now seemed to have leveled off.

Courageously turning a deaf ear to rabid nationalists, and ignoring the outlawed Communists who cry out against Yankee imperialism, he pointed to the need for U.S. dollars to put Brazil's economic machine in high gear. He wanted laws that would open up the country to profitable exploitation by foreign capital.

The touchstone was oil. Under Brazil's jungle, oilmen hope to find petroleum pools that will make the Western democracies less dependent on the strategically vulnerable Middle East. Brazilians, who last year spent $85 million on imported gasoline and fuel oil, are just as anxious to see the fields brought in. Though they lack the money to do their own proving, they have blocked exploration by foreigners.

In Rio, the oil diplomats of Jersey Standard, Shell and Texaco were anxiously waiting for Congress to write a law that would give them a freer hand in production, refining and distribution. Always before, the government had felt that Brazilians should control sales in Brazil. Now, with Dutra looking their way, the companies might get a law to their liking.

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