Jun 29, 2016
Post by Freedom Partners
Freedom Partners Senior Policy Advisor Andy Koenig explains in a June 28 USA Today op-ed why the U.S. Senate’s decision to withhold approval of an Ex-Im Bank board member is good for U.S. small businesses—and hardworking taxpayers.
Let the Ex-Im bank focus on small business for a change
Ronald Reagan once quipped that “a government bureau is the nearest thing to eternal life we’ll ever see on this earth.” Congress proved him right in December when it resurrected the Export-Import Bank of the United States, a little-known federal agency that doles out corporate welfare to the wealthy and the well-connected, after it had expired last June.
Yet while this New Deal-era federal agency may have cheated death, it now finds itself paralyzed. The question is whether Congress will do the right thing and keep it in this state.
They certainly should. The bank, which has handed out more than $200 billion in taxpayer-backed financing to private companies in the past decade, has lacked a quorum on its five-member board of directors ever since it was reauthorized late last year. This prevents it from approving any transaction larger than $10 million, effectively limiting its activity to small businesses.
That shouldn’t be a problem, judging by the rhetoric of Ex-Im Bank officials, its allies, and its beneficiaries. Throughout 2015 — when the bank was under siege by a small group of principled congressional Republicans — its backers routinely claimed that the Ex-Im Bank exists to help small businesses export their products. Its CEO, Fred Hochberg, said “the most important thing we do is … support the small businesses.” Similarly, President Obama declared the bank “helps small businesses go global.”
These sentiments were echoed by countless trade associations, lobbyists, politicians and others who wanted to convince Congress that a vote against the Ex-Im Bank was a vote against the engines of America’s economy.
But now big businesses are crying foul that the Ex-Im Bank can’t approve their transactions. That’s because they — not small firms — gain the most from the bank’s existence, which explains why they spent tens of millions of dollars lobbying for its reauthorization last year alone…
In reality, the Ex-Im Bank’s primary beneficiaries are multi-national companies with multi-million or even -billion dollar revenue streams…
The $10 million transaction cap dramatically curtails these businesses’ ability to co-opt the taxpayer into subsidizing their profits….
Read the full op-ed here.