clock menu more-arrow no yes

Filed under:

Counterpoint: Outdated Export-Import Bank is New Deal relic

Government officials often invoke “national security” to further their arguments, even on causes having little or nothing to do with American safety. One such claim: Our national security depends upon the reauthorization of the U.S. Export-Import Bank.

I’ve got a simple answer to that: No, it doesn’t.

Ex-Im was a relic of the New Deal that provides subsidized loans, guarantees and other financial assistance to foreign companies that pledge to buy American products. Prior to its expiration in July 2015, it supported less than 2 percent of all U.S. exports, making it a mere drop in the bucket of the overall economy.

OPINION

Moreover, the bank’s primary domestic beneficiaries were a mere handful of America’s largest corporations. In 2013, for instance, over 90 percent of its loan guarantees benefited only five companies; the year before, nearly 83 percent benefited just one.

But it’s not just a matter of economic prosperity. For decades, Ex-Im had done business with countries that either actively oppose American interests abroad or otherwise should be disqualified from receiving U.S. taxpayer support. A case in point is Ex-Im’s support for Vnesheconombank (VEB), a Russian state-owned bank that since 2012 has received two loan guarantees totaling $1.2 billion. This is the same VEB that President Barack Obama sanctioned last year in response to Vladimir Putin’s aggression towards Ukraine.

VEB is not an isolated incident of Ex-Im supporting countries that are hostile to American interests. Over the last 18 years, the bank has provided billions of dollars in financial assistance to the likes of Venezuela, China, Pakistan and other countries that raise serious red flags.

The basis of America’s economic greatness isn’t the government intervention in the economy that Ex-Im represents. We’re the most prosperous nation on Earth because we unleashed the power of free and open markets, giving entrepreneurs and consumers the freedom that leads to economic growth. That, and that alone, is why the United States is the most powerful economic and military force the world has ever known.

Pulling the national security card to justify the Export-Import Bank is simply disingenuous. “For national security” is a phrase used all too often to justify any manner of bad policies. Ex-Im is the latest example of this game and is all the more reason it should not be revived.

Pete Hegseth is the CEO of Concerned Veterans for America. A U.S. Army infantry veteran, he served tours in Afghanistan, Iraq and Guantanamo Bay.

Follow the Editorial Board on Twitter: Follow @csteditorials

Tweets by @CSTeditorials