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The Unneeded War Over the Export-Import (Ex-Im) Bank
09/03/14
Stan Veuger
Economics, Politics, United States
The Export-Import Bank plays a useful role in sustaining a truly global marketplace in which firms compete based on productivity and service, without being subject to the frills of fussy governments. It deserves to be reauthorized.
The
Export-Import Bank is under attack, more so than ever since its
founding in 1934. The federal agency, responsible for providing export
financing to American businesses, has quite suddenly become a lightning
rod for some conservatives and libertarians. These critics of the bank
see it as a “Petri dish of corruption and graft” and the “very definition of corporate welfare.” They believe that it should be “put out of its misery” to “level the playing field.”
Where
these emotions come from is quite clear. When the 2008 financial crisis
brought the U.S. financial system to the brink of collapse, the Bush
administration designed the Troubled Asset Relief Program
(TARP) to purchase distressed assets and provide liquidity to
struggling financial institutions. The bill authorizing this program
initially failed to pass the House of Representatives, but a fiercely
negative market response led to its eventual passage, and some of the
key players at the heart of the subprime mortgage crisis were bailed out
with taxpayer money. This was an unfortunate necessity, and it did not
sit well with large swaths of the voting population. A backlash against
crony capitalism ensued, and opposition to bailouts grew to be
widespread.
Read full articlehttp://nationalinterest.org/feature/the-unneeded-war-over-the-export-import-ex-im-bank-11185
