Export-Import Bank

You Want to Know Who Benefits from the Ex-Im Bank? Not Small Businesses.

Foreign airlines and oil companies top list of recipients.

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The Export-Import Bank has been in the news a lot in the last week. That's because for the first time in its 80-year history, freedom has a chance of winning over rampant cronyism, and Congress may kill the New Deal era agency. Understandably, the bureaucrats at Ex-Im are in panic mode. They have been super active on the lobbying front for months, but in the last few weeks they have doubled down on their "outreach" (translation: special interests' political pressure) to Congress.

Their best chance, they think, is to pretend market itself as an agency that benefits small businesses. It's a smart marketing move, because everyone loves small businesses! Never mind that small businesses in the world of the Ex-Im Bank is defined as a company with up to 1,500 employees and $21.5 million in revenue (so not small, really). Also never mind that the great small business success stories that the bank likes to tell always involve companies that were successfully exporting before the bank got involved (read this great piece by the Heritage Foundation's Diane Katz). Yet, that doesn't stop the bank from claiming credit for the company's exports and brag about how small-business-oriented it is!

More importantly, this image revamp falls apart as soon as you look at who the main beneficiaries are.

On the domestic side: Boeing. Our No. 1 exporter is the beneficiary of 70 percent of Ex-Im loan guarantee program and 40 percent of the Bank's overall activities. The company has a market cap of $90 billion, but apparently it needs help from the federal government. And did I mention that only 25 percent of the money actually benefits these alleged "small" businesses?

 

Mercatus Center

But that's old news.

What people may not know, however, is who the main beneficiaries are on the foreign buyers' side. These are the guys who are actually getting the cheap loans to buy U.S. goods.

Here is a table with the top 10 foreign recipients of Ex-Im cheap loans:

Mercatus Center

Not surprisingly we find many foreign airlines on the list (we could call them "Boeing boosters"). However, as you can see at the top of the list we find Pemex, the Mexican state-owned petroleum company. It has a market capitalization of $416 billion but still managed to secure a cumulative $7 billion in US-taxpayer-backed financing to facilitate deals with Americans since 2007. Worth noting, too, three other oil and gas companies made the top 10.

Now, I find this information strange, considering that the current administration hasn't exactly been pro-fossil fuels. It's been dragging its feet (and is now openly resisting) the Keystone XL pipeline for years. It subsidizes green energy companies through DOE loans (that's the loan program that wasted taxpayers' money on  the now-bankrupt Solyndra and Abound Solar, just to name a few), and it always looking for ways to dissuade consumers from buying "dirty" energy with higher taxes and heavy regulations. As Katz noted last year, the Obama administration is "imposing a hefty energy tax on Americans" while "subsidizing fossil-fuel projects in foreign countries."

And then there is this gem from Politico yesterday:

KERRY SLAMS FOSSIL FUELS, MUM ON KEYSTONE: Secretary of State John Kerry passionately called for nations to forgo the short-term lure of "outdated" fossil fuels today in a climate change speech at the Atlantic Council. But he offered no indication of his stance on the Keystone XL pipeline, whose fate is still under his department's review — a review now in its seventh year. "The bottom line is that we can't only factor in the price of immediate energy needs," he said. "We have to factor in the cost of long-term carbon pollution. We have to factor in survival." The implications for humanity's future will be grim if nations don't do so, Kerry warned.

I would laugh if it weren't so sad. My advice is for Kerry is to talk to his boss. It seems that he does know that the Obama administration supports the reauthorization of the Ex-Im Bank, and hence, supports the billions of subsidies going to foreign oil and gas companies. You can't make that up.

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  1. We could be so far past where we are, with much greater happiness, wealth, opportunity, and technological and scientific advance if we’d stop letting fucking criminals clothed in “government” titles run everything.

    1. Well, ProL, to stop that, you need to stop your childish belief that “government” is anything but an excuse and a way for these criminals to gain enough credibility with the masses to steal so much.

      Government is the way that parasitic criminals pretend to everyone that they’re something different, something other than what they are. And if you believe in even limited government, you are part of their support.

      1. Oh, I’m the villain here, am I? I don’t wear Darth Vader pajamas with the little footies, you know.

        1. Well, you are a lawyer. Which sort of makes you like a politician. Aren’t the vast, vast majority of them lawyers?

          1. They said the same thing about the Jedi. Aren’t the vast number of Siths Jedi-trained?

            1. Hokey religions and ancient weapons are no match for a good blaster at your side, kid.

              1. That’s what they said in law school.

            2. There is no way Epi has Darth Vader pajamas. They have to be either Jar Jar ones or baby Annakin.

      2. Epistarch, your argument that if one supports limited government, then one supports the Ex/Im Bank, is contradictory and paradoxical.

        With limited government, government doesn’t engage in doing favors for anyone or any business.

    2. But, but “the government is us!”.

      That’s what I constantly hear from the left.

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  2. I wonder if our resident progs are against the Ex-Im Bank and would condemn Warren’s support of it.

    1. Seems to me that ethics, disgust at hypocrisy, and a desire to hold people in power accountable are totally outside of the left’s universe these days, unless those things can be used to gain a political advantage. People should be ashamed of themselves for accepting such absence of character in political figures, even–no, especially–if they think those figures should have massive power.

      1. Principals, not principles.

        1. Indeed. But it doesn’t even make sense from their point of view. If you believe in total government, surely you want at least the illusion of competence and ethics, right? Otherwise, what’s the point? If you want people to abuse you and steal from you, that’s available without all of the effort.

          1. If you believe in total government, surely you want at least the illusion of competence and ethics, right?

            What for? When might makes right, competence and ethics aren’t necessary.

            Otherwise, what’s the point?

            Power.

            1. Of course, I get that the people in power or who might be in power would want that, but how does that explain the voters? Even taking into account TEAM sports and other stupid motivations, I don’t get putting the worst and dimmest in power for the ones doing the putting.

              1. They don’t see the distinction between society and government. That’s why they refer to government in the first person. So in their minds giving power to the government means giving power to themselves.

                1. I don’t know how they delude themselves the way they do, I guess.

                  1. You are a rational actor, ProL, they are not. I wish it were more complex than that but it isn’t.

            2. I think you are dead on sarc with the exception that for the left, power confers competence and legitimacy but only when they have it. That is why they are hell bent on crushing dissent.

          2. If you believe in total government, surely you want at least the illusion of competence and ethics, right?

            Theoretically, but that would presume honest actors on the left/proggie side, or any other side for that matter.

            To the left, the very existence of government and bureaucracy presumes and confers competence. It’s the Top Man fallacy writ large. They can do no wrong as exhibited by the completely unbelievable fact that absolutely nothing any of these people have ever done that has turned out bad or wrong has ever been reversed. In fact, when something doesn’t work the way they want or think it will work, they double down every single time.

            If these people tried that nonsense in an environment where results matter they wouldn’t get past the mailroom and there is no way they would ever end up in a position of authority. Government and bureaucracy is just a jobs program for incompetents.

            1. I see no way that doesn’t end in authoritarianism if the left ever buys enough of a majority to make it stick. Not that the right isn’t complicit in the continuing dilution of the idea of limited government, but they lack the glee for self-destruction that the left seems to have today.

              1. I agree completely. It’s what they want, anyway. They can’t even tolerate any dissent within their own ranks – that alone is very telling.

              2. All governments end in authoritarianism. By their nature they are loathe to undo any rules that they make, because admitting fault tarnishes their authority. So shitty rules result in consequences that result in more shitty rules that result in consequences that result in more shitty rules…. with the logical conclusion being a totalitarian state.

                1. I think you are correct. The totalitarian state that will emerge in the US will be one based on rules and regulations and will take longer to evolve, but it will be no less tyrannical. We are well on the way already.

                  1. Hey, now you guys are understanding why government is a fallacy!

                    1. I can’t wait until this libertarian moment ends in victory, and we can use our limited government to hunt down and exile Episiarch to Ceti Alpha V. Or VI. Whatever.

                    2. THIS IS CETI ALPHA V!!!

                    3. Oh, good, you’re already there.

                    4. Well then, we can use our limited government to make sure he stays there.

                  2. They way they control us is by controlling businesses. They could never get away with outlawing light bulbs. Instead they ban their importation and manufacture. Same idea with backup cameras on all cars. They don’t say all people must own cars with cameras, they tell manufacturers that drivers must have a field of vision that can only be achieved with cameras. Look at that recent attempt to ban ammunition. They can’t get away with banning the most popular firearm in the country, so they go after the bullets. They’re sneaking in their march towards totalitarianism, but the march continues nonetheless.

                    1. sneaking sneaky

                    2. They way they control us is by controlling businesse

                      Know who else wanted to control a country by controlling business?

                    3. The Trade Federation in The Phantom Menace?

                    4. Lord Vetinari?

    2. “I wonder if our resident progs are against the Ex-Im Bank and would condemn Warren’s support of it.”

      Naah. She’s part Indian. See how proggy logic works?

      1. It’s economic intervention, so it has to be good.

    3. Seems to me Warren is tapping into the anger of people who see the crony crapitalism in which our government engages for the benefit of politicians and the 1%, and instead, she wants to decide who to help and who to punish. I’d prefer the free market chooses who to reward, where individuals decide with whom they do business, and who is rewarded with their money.

  3. The Ex-Im bank. Reason #47 why studies show that Republicans and Democrats are happy. But not libertarians — because we know we are doooooooooomed.

  4. It seems that he does know that the Obama administration supports the reauthorization of the Ex-Im Bank, and hence, supports the billions of subsidies going to foreign oil and gas companies.

    The administration doesn’t actually give a shit about green initiatives or anything like that. It blocks the pipeline and other fossil fuel stuff to buy off some of its base, and then it clandestinely supports foreign oil companies because they and the ExIm bank lobby the administration, and the morons who want him to block the pipeline would never in a million years be bothered to look into anything like the ExIm bank. They don’t even know what that is. This is Politician 101.

    1. Rose-colored glasses. They have to use them, otherwise their worldview – that TOP MEN can solve every problem – would be shattered.

    2. This is so obvious that it takes some serious effort to ignore. A number of “environmental” politicians are under the covers with the fossil fuel industry. Gore is one of those, for instance.

  5. “Kerry passionately called for nations to forgo the short-term lure of “outdated” fossil fuels”

    When Kerry comes up with an “indated” alternative, he might have a point.

  6. C’mon, proggies. Tell me you support this government intervention that subsidizes risk for big corporations at the expense of taxpayers and small businesses.

  7. Never mind that small businesses in the world of the Ex-Im Bank is defined as a company with up to 1,500 employees and $21.5 million in revenue (so not small, really).

    I have commonly seen 50 employees as the cap on defining a small business, and I think that is too high.

    1. Yeah, when I think of small businesses, I think of sole proprietorships and maybe some partnerships with 10 or fewer employees. Maybe LLCs and privately-held corporations, as long as they have 10 or fewer employees.

      1. A restaurant is a small business but can have lots of employees, so 10 is probably too low a standard.

        Also, how can a 1500 employee company have under 21.5 million in revenue? That is $14k per employee.

        1. I would set the limit at 50 employees or $5MM in annual revenue.

        2. That’s why they need the subsidies, rob! See?

          1. The best solution to government is more government.

  8. Congress may kill the New Deal era agency
    .
    Are you new to this site, this country, or this planet? Congress is “threatening” to kill ExIm the same way my kid threatens to hold his breath until he dies if I don’t buy him an ice cream cone. Congress just wants a very expensive ice cream cone of some sort.
    .

    1. bingo! so sad to see people so gullible they really think the ExIm is under any threat.

  9. Secretary of State John Kerry passionately called for nations to forgo the short-term lure of “outdated” fossil fuels today in a climate change speech at the Atlantic Council

    I hate John Kerry. Words cannot express the depth of my loathing and contempt for that Boston Brahmin.

    I’d call him a prat, but that would be a kindness to him; prats generally have some glimmer of intelligence.

    Kerry is the prats’ prat. If you put all the prats in the world in a room, eventually he’d piss them off so much that they would call him a prat.

    I believe strongly that given 12 hours to prepare, and 15 minutes to present, that I could craft a powerpoint presentation that would convince John Kerry that the world was banana-shaped. I know I could do it, because that man is so gullible and stupid that anyone can convince him of anything.

    I’ll bet after an hour of presenting to him, I could even convince him that the U.S. should conquer the stem end to prevent it being cut thereby casting the banana-earth into the depths of space.

    But that would be a bad thing. The last thing this world needs is to make the delusional idiot that holds the office U.S. Secretary of State even more delusional.

    So I loathe him, and pray that one day his wife will find a young guy who twaddles her turnips and kick his sorry, broke ass to the curb.

    1. The low bar we now have for SoS is distressing. I’ve disliked holders of the office in the past plenty, but most seem to at least have some qualification for the position.

    2. If there is a more “punchable” face, I have not encountered it.

    3. Wait…the world isn’t banana shaped?

      1. Sir Bedevere *was* – occasionally – mistaken.

        1. I challenge you to refute his logic.

        2. But Mr belvedere was always right.

          1. Except for that time he sat on his own balls.

            1. Poor guy

          2. Well, only if you mean the Peter Cook one.

            1. I mean the fat one.

  10. Isn’t it great how Norwegian Airlines can get an Ex-Im loan for the purchase of airplanes from Boeing, and is then not allowed to fly those planes with passengers across the ocean so that they can pay back their Ex-Im loan?!!

  11. I think it’s pronounced “BOING” which reminds me of that shitty 80s band on the soundtrack to Back to School.

    1. Oingo Boingo! Dead Man’s Party Woooohooo!!!

      *anything to get rid of the goddamn James Taylor earworm in my head*

      1. Might I suggest James Brown to displace James Taylor.

        1. I’m going to plug into Pandora and create an AC/DC station….hopefully that’ll work

          1. Every time I rode with my uncle he had AC/DC playing in his truck. As far as I know he has been listening to AC/DC continuously for 30 years.

  12. What an absolute shock. Progressives rail against corporate welfare, but their belief in the necessity and benefits of major state intervention into the economy causes to fail to see how they actually support many of the primary avenues through which it is disbursed.

    1. Tony, AmSocialist, CraiginMASS, Palin’sbuttplug — WHERE THE FUCK ARE YOU?

      Please come here and defend Elizabeth or this bank or yours.

      Anyone…

  13. ExIm supports KKKOCHTOPUSSZZ!!!11!!

    Women, minorities hurt worst. Except Elizabeth Warren….

    1. Mother Jones will blow your mind.

  14. Let me guess – Congress will pass a “compromise” bill extending the life of the Ex-Im bank while promising reforms and directing it to give more money to “small” businesses.

    1. As long as they’re the *right* small businesses.

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  18. Only Crony Socialism here….
    Nothing to see…..
    Move along now!

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  23. While DeRugy shows the hypocrisy of the Obama administration (against the Keystone pipeline but supporting taxpayer subsidized loans to foreign oil companies), I wish she’d show which politicians actually voted for the reauthorization of the Import/Export Bank. If she did, it would show that 100% of Democrats supported it, while about 60% of the GOP politicians did as well. Here is the vote information from the re-authorization in 2012:

    http://www.govtrack.us/congress/votes/112-2012/h224

    Thus, Democrat politicians are the real supporters of crony crapitalism, with at least 60% of the GOP.

    Voters should know, and libertarian/Tea Party (real TP, not statists spouting TP rhetoric) are our only friends in Congress. It’s no surprise that the GOP leadership hates the Tea Party and libertarians.

  24. Actually, I support my family by working at a family-owned small (OK medium) business that would die without ExIm Bank.

    This Maryland Company Would Shrink by 70% Without the Ex-Im Bank

    http://www.noodls.com/viewNood…..the-ex-im-

    Bobby Patton, the CEO of Patton Electronics Co., a communications equipment manufacturer in Gaithersburg, Maryland, says his business would be forced to shrink by 70 percent if the bank shuts down.

    “Seventy percent of my revenue comes from outside the United States,” Patton says. “That means 70 percent of my accounts receivable financing would not be available to me. The only response that I could have is to start laying off employees, trying to collect the money as fast as I can and start to shrink my business if not shut it down. It would be a disaster.”

    http://smallbusiness.foxbusine…..x-im-bank/

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