A couple of years ago I was here making the case that it’s time to let the United States Export-Import bank go the way of the dodo bird. It’s an archaic appendage of the federal government which no longer fulfills a role even remotely close to it’s stated purpose of helping American small businesses increase their export volume by providing government insured loans to overseas customers wishing to purchase American goods. (At this point, more than 80% of their loans go to assist sales for Boeing – a fine company, but hardly what one would call small business, as I’m sure you would agree.) And now, as Dan Holler reports at Heritage Action, it’s becoming increasingly clear that Boeing doesn’t even need their help.
Fred Hochberg, the very vocal leader of a little known credit export agency called the U.S. Export-Import Bank, made a stunning admission in an interview with the Philadelphia Inquirer. In the words of reporter Joe DiStefano, Hochberg explained “Big commercial jet makers like Boeing tend to arrange their own financing.”
This is big news.
In the banking industry, the U.S. Export-Import Bank is commonly referred to as Boeing’s Bank. And it’s not hyperbole. While the taxpayer-backed Bank claims nearly 80-percent of its loan guarantees go towards small businesses, the overwhelming majority of the total dollar amount goes to Boeing. By some estimates, the massive multinational aeronautical company receives upwards of 80-percent of the Ex-Im Bank’s taxpayer-backed loan guarantees.
As Congress considers whether to reauthorize the Ex-Im Bank later this year, lawmakers should ask a simple question: if Boeing can arrange its own financing, why is the Bank so heavily involved in subsidizing Boeing’s export financing?
The truth is such involvement isn’t necessary.
There was a time when this was a fairly bipartisan issue. Everyone seemed to know – and agree – that Ex-Im had outlived its usefulness some time ago and had essentially turned into a corporate welfare slush fund. Writing about the need to do away with this taxpayer funded dinosaur, David Williams wrote at Town Hall about one unlikely former proponent of such a plan… President Obama.
On the 2008 campaign trail, President Obama unequivocally declared that the Export-Import Bank of the United States (Ex-Im Bank) is “little more than a fund for corporate welfare.” Flash forward six years, and the president’s Democrat allies in Congress are demanding that lawmakers “direct immediate attention” toward renewing the Bank’s authorization, which is set to expire in September of this year.
This drastic reversal is nothing short of appalling, especially when contextualized with the Bank’s tendency to harm American interests.
You would think this is something we could manage to get done. Even at a time when Congress is best known by the moniker of do-nothing, eliminating Ex-Im should be right up their alley. You see, in order to kill this outdated agency off, all Congress literally has to do is… nothing. A simple failure to renew the bank’s charter later this year will send it packing, and when it comes to failing to do something, you won’t find much more of a crack team than the gang in Washington.
I get that there are a lot more pressing things eating up the news cycle these days, and as the mid-term season and primary battles heat up it’s easy for the media to get distracted and let routine housekeeping business like this slip under the radar. But this is one area where fiscal conservatives could accomplish a substantial long-term good without breaking a sweat. It will, however, require some light being shed on the issue and voters letting them know that this rather obscure topic is one they are watching, and we expect them to do the right thing.