April 24, 2014
This September, Congress will have the opportunity to terminate a federal “bank” that doles out loans to foreign countries and well-connected major corporations while leaving taxpayers like you are on the hook for any losses.
Heritage Foundation expert Diane Katz explains that the costs of the Depression-era Ex-Im Bank outweigh the benefits:
Ex–Im advocates offer myriad excuses for maintaining government interference in export financing, including job creation, gaps in private investment, and government subsidies lavished on foreign firms. Such justifications do not stand up to the facts, and the purported benefits, if any, are not commensurate with the risk to taxpayers.
Unfortunately, Katz continues, special interests benefit from its largesse. “The bank is a conduit for corporate welfare beset by unreliable risk management, inefficiency, and cronyism.” Even then-candidate Barack Obama described it in 2008 as “little more than a fund for corporate welfare.”
This type of government interference inevitably “distorts the competitive landscape, with winners and losers determined by political considerations rather than the merit of their products and services,” Katz argues.
Do you think the Ex-Im Bank’s charter should be terminated?