The Honorable Justin Amash
United States House of Representatives
114 Cannon House Office Building
Washington, DC 20515
Dear Representative Amash:
On behalf of the members of National Taxpayers Union (NTU), I write in strong support of H.R. 1605, the “Export-Import Bank Termination Act.” This legislation would wind down the activities of the Export-Import Bank (Ex-Im) over three years, bringing to an end a program with dubious benefits and serious liabilities for taxpayers.
A majority of Ex-Im financing uses taxpayer dollars to back overseas sales for large, profitable companies like Boeing, John Deere, Caterpillar, Dell, and GE. The government should be seeking to reduce, not perpetuate, its role in underwriting private business activities. Total U.S. exports for 2013 came to $2.3 trillion, marking a new record for the fourth year in a row. During the same year, Ex-Im approved $27.3 billion in loans, just over 1.2 percent of our total exports. As markets open and grow, those exports will rise without unnecessary subsidies from Ex-Im. This kind of crony capitalism only encourages wasteful spending and does not serve the interests of taxpayers.
Created in 1934 as part of the New Deal, the Ex-Im Bank has become, as President Obama himself stated on the campaign trail in 2008, “little more than a fund for corporate welfare.” Like Fannie Mae and Freddie Mac, Ex-Im exposes taxpayers to considerable risk and substantially distorts markets. This was confirmed by the Congressional Budget Office, which found that rather than generating revenue, the Ex-Im Bank’s credit programs actually cost taxpayers $2 billion when accounted for under a fair-value basis, which more accurately reflects market risk.
When government picks winners, the real losers are the American people as witnessed by debacles like Solyndra, a failed company that received Ex-Im funding. Proponents of the bank cite its role in filling private funding gaps, but those gaps argue for its elimination, not its continuance. If private entities are unwilling to risk their own money, it should serve as a warning sign that tax dollars shouldn’t be exposed either.
Free-market conservatives aren’t the only ones calling for an end to the Ex-Im Bank. In the past, our annual “Toward Common Ground” report, undertaken with the left-of-center U.S. Public Interest Research Group (U.S. PIRG), has advocated for the elimination of the Ex-Im Bank. While NTU and U.S. PIRG differ on the appropriate size and scope of the federal government, we were united in our belief that the bank is an anachronistic corporate welfare program that should be ended immediately.
Your legislation is an important opportunity to take a positive step toward smaller and smarter government by phasing out the Ex-Im Bank. NTU is pleased to endorse the “Export-Import Bank Termination Act,” and urges all Representatives to co-sponsor the legislation.
Sincerely,
Nan Swift
Federal Affairs Manager
