At his event in Seattle tonight, it won’t be surprising if President Obama praises the Export-Import Bank as a “jobs creator” that “doesn’t cost taxpayers anything.”
It’s a far cry from how he used to describe the Export-Import Bank—as “little more than a fund for corporate welfare.”
The president may hope that his audience is unfamiliar with those remarks. He may also hope they overlook the fact that the Ex-Im Bank has been doing business with Russian companies that his Treasury Department added to its sanctions list.
But here are five important facts about Ex-Im:
1) The Ex-Im Bank doesn’t create jobs.
Government export finance assistance programs like Ex-Im “largely shift production among sectors within the economy rather than raise the overall level of employment in the economy.”
—Government Accountability Office, “Export-Import Bank: Key Factors in Considering Ex-Im Bank Reauthorization”
“[A]t best the Ex-Im Bank creates jobs in export industries by destroying jobs in non-export industries.”
—Donald Bodreaux, professor of economics at George Mason University
“By some estimates, the bank’s loan guarantees have resulted in up to 7,500 lost U.S. carrier jobs, and up to $684 million of lost income for U.S. airline employees annually.”
2) The Ex-Im Bank doesn’t return money to the taxpayers.
The Ex-Im Bank’s profits aren’t real. They are an accounting illusion. The non-partisan Congressional Budget Office reports that if the bank followed more accurate accounting rules, its ledger would show a cost to taxpayers of $200 million/year, or $2 billion over 10 years.
—Congressional Budget Office Fair-Value Estimate
3) Less than 1 percent of 1 percent of America’s small businesses benefit from Ex-Im.
Congress requires that 20 percent of Ex-Im’s authorizations go to small businesses, but Ex-Im consistently fails to meet this statutory requirement. In reality, just 0.009 percent of America’s small businesses receive any help at all from Ex-Im.
Instead, Ex-Im’s subsidies go overwhelmingly to very large corporations like Boeing, GE and Caterpillar.
4) The Ex-Im Bank uses American taxpayers’ money to help foreign corporations, including businesses that are owned by the governments of China, Russia, Saudi Arabia, and the United Arab Emirates.
Of the 50 largest loans or guarantees approved by the Ex-Im Bank since fiscal year 2007, 46 percent of the loans have gone to state-owned companies or to a joint-venture that includes a state-owned company.
5) The Ex-Im Bank financed only 1.6 percent of total U.S. exports in 2013.
That’s less than 0.18 percent of the total U.S. economy.