Let’s say you’ve been letting your child watch too much TV. You decide, quite sensibly, to cut down on his viewing time. Think he’ll realize it’s for the best and take it without a fuss?
Not likely. One way or another, he’ll make his feelings known. You might get tears, or you might get a pout, but the chances of a smile and a nod are remote.
We see the same principle at work today with some of the “big children” who are unhappy that Congress finally let the Export-Import Bank expire at the end of June. For years, this poster child for crony capitalism has provided taxpayer-backed loans, guarantees and insurance to foreign countries and companies to pay for U.S. products.
Many U.S. companies get along just fine without your tax money, I’m glad to say. But others clearly came to expect that flow of largesse. And some rather large companies at that, such as Boeing ($60 billion), General Electric ($6 billion), Bechtel Power Corp. ($4.6 billion), CBI Americas Inc. ($3.2 billion) and Exxon Mobil ($3 billion).
Their competitors have proven that they don’t need hand-holding from Uncle Sam to compete in the global marketplace. Indeed, 98 percent of U.S. exports receive no support at all from the Ex-Im Bank. You’d think former Ex-Im Bank clients would be inspired to do likewise. Instead, like that petulant child being denied hours of daily TV, they’re trying to retaliate.
Hence GE’s recent announcement that it’s planning to move jobs overseas. Not many, relatively speaking — 500 of its 136,000 U.S. workers. But there’s talk of more to come. Should we be concerned? No. Ex-Im Bank expert Diane Katz flatly labels this claim “nonsense.” The jobs GE says it will move don’t even exist.
Take the 400 jobs Greenville, S.C., will supposedly lose. Look beyond the headlines. What GE actually said was that these jobs might be created in France if their project bids win. GE is playing chicken with fake jobs.
And the remaining 100 jobs, which would allegedly move next year from Houston, Texas, to Hungary and China? “Business as usual,” Ms. Katz says. GE is a very big company, and it moves jobs around all the time. It’s dishonest to blame the expiration of Ex-Im. It’s simply a convenient political scapegoat — nothing more than rank corporate spin.
GE, Boeing and other Ex-Im proponents have spent tens of millions of dollars over the last year and a half trying to convince Congress to keep the Ex-Im Bank going, insisting that American jobs depend on it. GE Chairman and CEO Jeff Immelt has even claimed that, without the Ex-Im Bank, we can expect “economic catastrophe.”
This is utterly ridiculous. Private financing for U.S. companies is readily available, as shown by the vast majority of American companies who thrive without a dime from the Ex-Im Bank. U.S. exports have reached record levels in recent years, and all but 2 percent of them get by without the Ex-Im Bank. To predict “catastrophe” in its absence is absurd.
“Boeing Capital posted customer-finance assets of $3.4 billion in the first quarter of 2015,” writes Ms. Katz. “Indeed, both Standard & Poor’s and the Government Accountability Office effectively have concluded that Boeing, with a market cap exceeding $97 billion, would manage well without taxpayer subsidies.”
It’s not so much a question, then, of not being able to survive without the Ex-Im Bank. It’s a question of not wanting to give up the benefits of corporate welfare. So, just as a child who is angry at losing a privilege will pitch a fit, the Ex-Im Bank’s clients are making threats about jobs and warning of terrible things to come.
Lawmakers should ignore them. It’s time Washington stopped picking winners and losers in the global marketplace. Letting the Ex-Im Bank stay buried is a small but important signal that it’s actually possibly to let an unnecessary government program expire — for good.
• Ed Feulner is founder of the Heritage Foundation (heritage.org).