Today, Campaign for Liberty joined over 50 other organizations in calling for the Export-Import Bank to expire. The Ex-Im Bank provided taxpayer-backed loans to foreign companies to buy American products. Not only does this interfere with the free market and put US taxpayers on the hook for billions of dollars of loans, but it acts as a subsidy to large corporations at the expense of smaller ones. Campaign for Liberty opposes all forms of corporate welfare and believes that companies should compete on the merits of their products and rather than their political ties.
From the text of the coalition letter to Congress:
By paying foreign companies to buy American exports, the Export-Import Bank tilts the playing field away from mid-sized and small businesses in favor of large, politically connected corporations. The Airlines for America, for example, estimates that the bank’s recent loans to foreign airlines have killed as many as 7,500 jobs for domestic airlines in the United States. Eliminating the Export-Import Bank would level the playing field and allow U.S. companies to compete for business on their merits rather than the strength of their political ties to the bank.
Not only does the Export-Import bank interfere with the free market, it also jeopardizes billions of taxpayer dollars. According to a 2014 report from the Congressional Budget Office the bank will costs taxpayers $2 billion over the next decade despite claims that it pays for itself. This discrepancy is because the bank does not use fair-value accounting, a method widely used by private finance organizations. These risky loans and poor accounting practices are harmful to taxpayers, who are left footing the bill.
The full text of the coalition letter can be found here.
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PDFTags: corporate welfare, Ex-IM Bank