Mention the Export-Import Bank and people’s eyes glaze over, but here goes an attempt to make the entity interesting enough for you to read on. A certain notorious flop company shows up later in this post, so stay tuned. In fact, two notorious flops show up.
Ex-Im officials are out on a publicity tour, touting their love for small business.
During the summit, Chairman Hochberg gave an overview of Ex-Im’s Small Business Initiative. The initiative was launched in 2011 with the goal of increasing the number of U.S. small businesses that export American-made goods and services. This is an integral part of President Obama’s National Export Initiative to double U.S. exports by 2015.
And so forth. You’re paying for the publicity tour, by the way, same as you’re paying for those federal judges to galavant off to Maui. For a government in the grips of “austerity,” its spending remains awfully extravagant.
So the Ex-Im touts its attention to small business, using cherry-picked statistics. Its actual spending tells a very different story. Small businesses power the US economy: According to the USSBA about half of all workers in the US work at small businesses, and small businesses make up about 97% of US exports. If it is to remain in existence, which is highly debatable, the Ex-Im Bank should pay attention to them.
The Ex-Im’s own 2011 annual report reveals something else. The image below is a screen shot of a section of page 30. Click to enlarge.
Solyndra found more than one federal trough to feed from, yet couldn’t find a way to build a viable business. The Ex-Im did not recognize what a greendoggle the company would turn out to be, despite the fact that a quick glance at its opulent headquarters full of inventory it could not sell would have suggested that something was deeply wrong at the so-called start-up.
Ex-Im amounts to corporate welfare for big shots (Boeing) and the well-connected (Solyndra). In the past it lent mightily to Enron to sell to itself, which is neither an export nor an import, and Ex-Im even accidentally loaned millions to Mexican drug cartels. When President Obama and Secretary of State Clinton blame America for Mexico’s drug violence, they probably didn’t have this, or Fast and Furious, in mind. Ex-Im also wasted taxpayer money lending money to an Indian air carrier that is now bankrupt.
Despite the Ex-Im’s small business friendly publicity tour, it isn’t really helping US small business all that much. Small business would probably not miss the Ex-Im at all if the entity just went away, but taxpayers might notice that the federal government suddenly isn’t wasting billions that it has been wasting year after year.