THE FACTS ON EX-IM
In 1934, Franklin D. Roosevelt created the Export-Import (Ex-Im) Bank to promote trade with the Soviet Union. In 1946, Congress established it as a federal agency to “facilitate exports and imports and the exchange of commodities between the United States and other Nations.” This aid now takes the form of loans and loan guarantees, as well as working capital and credit insurance, to both U.S. exporters and foreign purchasers of American goods and services (including foreign governments).
Proponents of the bank claim it “sustains” jobs and acts as a necessary counter to subsidies provided by foreign governments. The reality is that this interference in and manipulation of the market produces economic distortion, cronyism and corruption.
The Bank’s charter will expire at the end of September, and a bipartisan coalition is advocating for reauthorization. If not reauthorized, the bank will be unable to offer new loans, effectively grinding it to a halt and preventing it from distributing subsidies to new constituencies.
Special interests have spent decades perfecting the art of navigating the expansive government-industrial complex, and Ex-Im plays a major part in their influence. As a result, lobbyists in Washington frequently have more influence than constituents back home. The fight against the Ex-Im Bank is not only a fight against cronyism, but an opportunity to empower individuals outside of Washington. Private sector investors and businesses best understand how and why to utilize their capital and are incentivized to make reasonable, fact-based choices given that they are risking their own money. It is time for lawmakers to answer to their constituents back home, and not the powerbrokers in D.C. Congress should not reauthorize the Ex-Im Bank.