4/27/17 – Bank of Boeing
It’s time to shut-down the Export-Import Bank once and for all.
Here’s what’s happening behind the headlines.
The bank was started by FDR in 1934 to loan money to the Soviet Union. That worked well for us, didn’t it?
Now it provides low-interest loans to foreign companies to buy U.S. goods.
Nearly half of the 172 billion dollars in loans between 2007 and 2014 benefited only 5 U.S. companies. More than a third — 60 billion dollars — benefited just one company — Boeing. That’s why DC politicians call it the “Bank of Boeing.”
So, isn’t selling U.S.-made aircraft to foreign airlines a good thing?
In many cases, low-interest loans go to airlines owned by foreign governments, such as China. Should we be subsidizing foreign governments?
Foreign airlines then buy Boeing jets for less than U.S. airlines. This gives foreign carriers a competitive advantage over U.S. carriers in the global market. According to one estimate, it’s cost U.S. airlines nearly 7,500 jobs.
[In another example, heavy equipment manufacturer, Caterpillar, owns a European Caterpillar distributor that only deals in Caterpillar products. It receives Export-Import Bank loans to buy equipment from the U.S.-based manufacturer. From who else would an exclusive Caterpillar dealer buy Caterpillar products? This smacks of crony corporatism.]
[In recent years, the Export-Import Bank has been caught-up in the worst case of crony corporatism by trading influence and money to support the number one worst performing company in the S&P 500 which, coincidentally, had ties to then-President Barack Obama’s political cronies.]
Should U.S. taxpayers be on the hook for loans that private banks can make? And if the loans are too risky for the free market to consider — then why should U.S. taxpayers guarantee risky loans? We’ve been there, done that.
It’s time for the Export-Import Bank to go away.
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