At the end of the month, the Import-Export Bank of the United States may actually go away.
The Republicans never had the nerve to close the bank. In fact, I was at a private meeting of conservative Senate
staffers on Capitol Hill where representatives of the Chamber of Commerce warned conservatives that the chamber would withhold support from the GOP if the bank was not renewed.
What is funny is the chamber stooges did not seem to grasp that conservatives are not Republicans, they just happy to have a home there for now.
Still, maybe the GOP will have the courage to let the Import-Export Bank die a natural death at midnight Sept. 30..
Eighty years ago, President Franklin D. Roosevelt created the bank to support private financing of imports and exports during the Depression.
The bank continues today because politicians like to be able to toss their friends a cheap loan. For the successful companies, the bank is an unnecessary handout.
For example, does Boeing really need the taxpayers to subsidize more than $120 billion dollars deals since 2007? Tell me that the bank does not offer any advantage and I will ask why it exists? Tell me that Boeing had nowhere else to go and I will laugh in your face.
Of course, the guys not laughing are the U.S.-based airlines competing with the foreign airlines getting the sub-market loan for a brand new Boeing 787.
Take another Washington State example, Chateau Ste. Michelle, a vineyard owned by tobacco giant Altira, the former Phillip Morris, has had $71 million worth of financing from the Import-Export Bank.
Next time you spit out their swill, think about the Import-Export Bank financing an American company literally sending cases of hack Riesling to Germany.
Think, too, about the new vineyard trying to make a go against a government-supported giant.
For the struggling companies, the bank’s sweetheart loans an unfair advantage that penalizes more competent competitors and rewards a business that the market is trying to squeeze out.
Either way, the Import-Export Bank should go.
In Massachusetts, the Import-Export Bank has helped out 161 companies with financing for $4 billion worth of deals since 2007—none west of Route 91 and only 13 west of Worcester.
The bank’s top client in the Bay State is Wellesley’s Grove Services, one of the world’s largest poultry and meat traders. Grove Services, which got its start selling chickens to the Soviet Union, secured financing for more than $1 billion worth of deals.
Another struggling family-owned business is Carver’s Decas Cranberry Products, which had $70 million with worth of tart berries fiananced.
No Somerville company received help in the last seven years. But a Cambridge company founded by Harvard University researchers, Cambridge NanoTech got financing for $25 million in the last seven years.
In what universe do Harvard researchers have to go to the taxpayers for a little bump?
As with rent control, where the connected fancies and swells end up with price-controlled apartments meant for the poor, Import-Export Bank deals end up going to the companies with connections and more often than not to companies that simply do not need the help.
Our randy, red-haired founding father Thomas Jefferson was all about the need for constant revolution. It was this mindset that blinded him to the dangers of the French Revolution and certainly led him to suggest: “What signify a few lives lost in a century or two?”
Lucky for us, the American economy serves that refreshing and renewing process that Jefferson yearned for without the blood of patriots and tyrants that he called the natural manure of the tree of liberty.
Institutions like the Import-Export Bank need to go. At best, they help people who do not need help. At worst, they are example of the government picking winners and losers in the economy without regard for how they compete in the marketplace.
Besides, without the backstop of the American taxpayers, maybe Boeing will build an airliner that does not get grounded.