Reaching out to Congress
05/06/19 Filed in: Spending
Reader feedback at end
There will be no blog entry this week due to a previously announced “spring break,” and while a major development in the Bloom Energy saga is brewing it won't be announced until the papers have been filed. However, we’re pleased to report SAFE’s participation in a coalition letter re the Export-Import Bank (EIB).
SAFE has long doubted that the financial activities (loans and loan guarantees) of the EIB are necessary to promote US exports. Accordingly, this program represents a form of “cronyism” that could/should be discontinued.. What about the Export-Import Bank? 5/14/12.
. . . the best argument against the EIB is very simple. US business firms could get along without government-supported export financing if necessary – as they did before the 1930s. If one [favors] smaller, more focused, less costly government, therefore, it would seem logical to close the bank down.
One reader made the point more forcefully in his comment. Ibid.
The Ex-Im Bank is just another federal subsidizer for all sorts of unsavory institutions, plus part of the bailout network. It's a taxpayers' nemesis, and a counterforce to stable economic policy. If the Republicans support continuation of the EIB, they are part of the problem. Abolish the EIB and all like it. They are millstones around the neck of legitimate enterprise. – SAFE member (Georgia)
Since 2012, Congressional conservatives have periodically attempted to block renewal of the EIB’s charter, thereby terminating new loan authority and forcing a phaseout of operations. Although such efforts haven’t been wholly successful, EIB’s operations are currently constrained by the absence of a quorum on its board. Warning that the ability of US firms to compete with China may be impeded, which seems unlikely as Boeing et al. can readily obtain private sector financing, administration officials are pushing to fill the board vacancies so the EIB can resume “business as usual.” Honey, we shrank the Ex-Im Bank, Wall Street Journal, 5/1/19.
. . . since 2015 the agency hasn’t been able to make loans of more than $10 million, and no one seems to have suffered as a result. Loans over $10 million require board approval, and the board hasn’t had a quorum, as Congress has not confirmed nominees. The lack of a quorum has converted the bank into a financier of small business, which proponents have always argued is the place’s purpose. *** The bank’s risk exposure has dropped to $66 billion from $116 billion in 2013.
SAFE recently joined in a letter to Congress urging that the EIB charter be allowed to expire on September 30. The letter was submitted to the members of Congress on May 2 with the signatures of 18 conservative organizations including Americans for Prosperity, Freedom Works, Heritage Action, and National Taxpayers Union.
# Kudos to you for signing SAFE onto this letter. – SAFE member (Delaware)
# Looks like we’re in good company. – SAFE member (Delaware)
#Good one! – Retired financial manager