Tuesday, June 23, 2015

Export/Import Bank Needed? : Chamber Support With $$$

Like the debate over immigration and the Chamber of Commerce's stand supporting an unending flow of immigrants into the work force, the debate about the waste and actual function of the Export/ Import bank is important as the county is facing huge deficits and debt now and in the future.

It does appear the bank serves no good purpose other then to feed the needs of self serving bureaucrats and crony capitalists. And maybe worse, the Chamber is beginning to wobble on it's reputation of being strictly in the best interest of free enterprise and open markets.

Can the Chamber be bought? Who wins and who loses?

Chamber of Commerce Spends Big to Save Export-Import Bank
Source: Stephen Moore, "Using Tax Dollars to Lobby for More Tax Dollars," Heritage Foundation, May 27, 2015.

June 4, 2015

How much do taxpayers have to pay off Boeing to make the Export-Import Bank (Ex-Im) finally and irrevocably go away? If the feds wrote a check to Boeing for $100 million, would they then let the Ex-Im Bank fade away after the current portfolio winds down?

Boeing is the largest beneficiary of the Ex-Im Bank. The bank provides subsidized loans and insurance contracts to foreign companies that buy American exports. Ex-Im Bank doles out billions of dollars of loans and insurance subsidies every year and has become the poster child for corporate cronyism in Washington.

Would America's exports grind to a halt without the Ex-Im Bank?
  • Getting the federal government out of export financing would save taxpayers from having to cover the bank's $2 billion shortfall projected over the next decade by the Congressional Budget Office.
  • Without an Ex-Im Bank, which finances just 2 percent of U.S. exports, private firms would provide the insurance and credit these companies need, but at market rates that reflect risk of default.
  • Beyond the cost and risk of its $140 billion portfolio of taxpayer-guaranteed loans, is that it turns business into advocates for big government. This also explains why the largest business lobby in America, the U.S. Chamber of Commerce, is spending $1 million on a campaign to save the program.
The Chamber of Commerce normally does great work promoting pro-growth economics and while they may win this Ex-Im Bank battle, its overall cause will be hurt in the end.

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