U.S. Export-Import Bank: “A Publicly Subsidized Piggy Bank for Large Corporations”
What is the Export-Import Bank of the United States? Veronique de Rugy, a senior research fellow at the Mercatus Center at George Mason University, nails it:
The Export-Import Bank is one of the least defensible corporatist boondoggles that taxpayers are forced to subsidize. This US government-owned corporation styles itself as a self-sustaining independent executive agency that selflessly serves the public by “support[ing] jobs in the United States,” “facilitating the export of US goods and services,” “provid[ing] competitive export financing,” and “ensur[ing] a level playing field for US exports in the global marketplace.” In reality, the Ex-Im Bank is little more than a publicly subsidized piggy bank for large corporations, who retain private profits while transferring risk to taxpayers. (emphasis added)
The Bank’s risk transfers and market distortions are unjustifiable. It’s political agendas and cronyism are even less so.
As we’ve previously noted, by some estimates, the Bank gives about 80 percent of its loan guarantees to Boeing, a massive multinational aeronautical company that frankly doesn’t need the help. This is not about American small businesses.
It put American taxpayer dollars at risk for the failed solar panel company, Solyndra, backing it with $10.3 million loan guarantee.
Russian billionaire businessman and friend of Vladimir Putin, Gennady Timchenko, is cozy enough with American lobbyists to get them do do his bidding for U.S. backed funding for the purchase of private luxury aircraft.
Australia’s richest woman, billionaire Gina Rinehart, owns a company called Hancock Prospecting, which recently signed off on “$US7.2 billion debt package for her highly anticipated Roy Hill iron ore project” via the Ex-Im Bank. If commercial banks wouldn’t take this risk, why is it being foisted upon American taxpayers?
It’s time to end what then-Senator Obama once called a “fund for corporate welfare.” Congress, 2014 is the year to make this 80-year-old cronyism-inducing institution meet its end.