July 4, 2014

MEGAN MCARDLE: Die, Ex-Im Bank, Faster, Faster!

The most interesting, and puzzling, political development of the last month has been the impending demise of the U.S. Export-Import Bank. Puzzling, because the Export-Import Bank is basically small beer — the sort of government agency that usually achieves immortality through obscurity. It’s surprising to me that this has actually become a hot political issue. Interesting, because reform conservatives look like they may well claim a genuine scalp: eliminating a long-standing instrument of corporate welfare. . . .

But if the economic impact is slight, the symbolic impact is huge: Conservatives are taking a run at a major dispenser of corporate subsidies, while Democrats have suddenly discovered a deep love of government-financed corporate expenditures. It just got a little bit harder to argue that Republicans are the party of big business.

On this issue, I’m with the symbolists. The government should not be directly subsidizing purchases of American goods, and no, I don’t care if all the other kids at the World Trade Organization get to do it. The principle involved is not whether there’s an explicit taxpayer expenditure, but whether corporate welfare is within the proper scope of the federal government’s duties. Conservatives say it isn’t, and I agree.

It sets a precedent, which needs to be followed through on.