Success in America should come from hard work and character, not political connections. For too long, special interests have taken advantage of Washington favoritism to enrich themselves at the expense of taxpayers. The Export-Import Bank of the United States is a textbook example of this kind of cronyism. It’s time to let the Export-Import expire stop subsidizing massive companies like Boeing, GE and Caterpillar.
While Export-Import’s supporters may praise it as a “critical” finance tool, in reality, 99.6 percent of Louisiana’s goods are exported without it. If the private sector believes a business venture isn’t credit-worthy, Export-Import shouldn’t force taxpayers to risk their money. According to the Congressional Budget Office, Export-Import is expected to cost $2 billion over the next 10 years.
Companies like GE insist Ex-Im is critical to help them compete against foreign companies subsidized by their governments, but the reality is Export-Import does little to level the playing field. According to Export-Import’s own reporting, less than one-third of its financing went to counteracting foreign export credit agencies.
Policymakers should not overlook the fact that whenever government picks winners, there are always losers. According to the Cato Institute, the top 10 industries hurt by Export-Import’s favoritism make up 13 percent of Louisiana’s manufacturing GDP. This is no small issue for the residents of Louisiana.
Subsidies and government-planning have a proven track record of failure. If other countries are going to pursue bad economic policy, we should let them. There is no need to get involved in what Rep. Jeb Hensarling, R-Texas, called a “taxpayer-funded subsidy arms race with the rest of the world.”
Congress’ time would be better spent creating opportunity for all Louisiana industries, rather than playing favorites with a handful of corporations.