Return of the Ex-Im Bank?
posted at 10:31 am on May 5, 2012 by Jazz Shaw
Two months ago we examined the issue of whether or not the charter for the Export Import Bank of the United States should be renewed. (If you’re still unfamiliar with this somewhat obscure federal entity, I suggest you click through to the previous article for he back story.) The response from the Hot Air faithful was almost unanimous: you hated the idea. If we were to put it into a word cloud, the most common phrases I noticed in the responses included, “crony capitalism, government picking winners / losers, and slush fund.” The few positive comments for the Ex-Im mostly centered on some sympathy for Boeing – the largest recipient of the bank’s largess – and a desire not to see them take yet another beating at the hands of the Obama administration.
Sadly, it seems that the leadership in both parties fail to read Hot Gas. (Or if they do, the opinions of the unwashed masses don’t carry much weight on the Hill.) As part of the Friday Night News Dump, it looks like a deal has been cut.
House Minority Whip Steny Hoyer (D-Md.) late Friday formally unveiled a deal he has struck with House Majority Leader Eric Cantor (R-Va.) to reauthorize the Export-Import Bank, whose charter expires at the end of the month.
The deal is a rare instance of bipartisan cooperation in a highly polarized Congress. The bill, H.R. 2072, will be considered on the House floor under suspension of rules next week, according to Cantor’s office. Similar to a Senate Banking Committee-passed bill, the bill has a strong shot of House passage…
Republicans were able to secure language that orders the Treasury secretary to start negotiations wit global trading partners to eventually end export subsidies. Conservatives oppose export subsidies as market distorting, but Ex-Im Bank supporters say that as long as Europe, China, Japan and others back their exports with loan guarantees for foreign buyers, the U.S. can not unilaterally end them.
The deal only extends the bank’s charter through September of 2014. (Isn’t if funny how these things always seem to end right before the next round of elections?) It also raises the lending cap for the bank to $140B. Hoyer is painting this as a way to support middle class job growth, while Boehner is chiming in saying it’s needed to allow us to continue competing in the international market. (Other governments regularly subsidize their exports to get an edge on the playing field.)
Honestly, I don’t understand the advantages of cutting a deal like this. If the GOP leadership is approaching this from a position of insisting that the Ex-Im be phased out and eventually eliminated entirely, aren’t they acknowledging that this is a bad thing? And if it is, wouldn’t you just move to shove a stake in the vampire’s heart here and now, rather than waiting to fight the battle all over again right before the mid-terms in two years? And this isn’t one of those situations where action is required with bipartisan support to get something done. If you want to get rid of the bank, all you have to do is… nothing.
I smell a rat. And the direction of the wind seems to be blowing from Washington.