Export-Import Bank Debate

#1
n_huffhines

n_huffhines

What's it gonna cost?
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Mar 11, 2009
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#1
If you hate corrupt business practices and/or big government, you should be against the Export-Import Bank. Make sure your representatives are (doubtful).

Congress will soon debate the fate of the U.S. Export-Import Bank, an outfit that doles out money to favored corporations and foreign governments. For 80 years, the bank and the crony capitalists it supports have defeated every attempt to shut it down. But that may slowly be changing...
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The Crony Capitalism Machine - Reason.com
 
#3
#3
"The transactions are seen as low-risk since they are backed by the "full faith and credit" of the federal government. This has encouraged Democrats and Republicans alike to rack up $134 billion in outstanding liabilities, any of which will be covered by taxpayers if something goes wrong."

Business as usual for the government.

I think you'll like this.

No Corporate Welfare – LewRockwell.com
 
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#6
#6
Several years ago I was offered a position at the Export-Import Bank. The salary, however, was less than I was receiving in Tennessee. No way would I move to DC for less money even for what would have been an interesting job.

All things considered, the positives of Ex-Im Bank exceed the negatives.
 
#7
#7
Abe Hoffman said:
Several years ago I was offered a position at the Export-Import Bank. The salary, however, was less than I was receiving in Tennessee. No way would I move to DC for less money even for what would have been an interesting job.

All things considered, the positives of Ex-Im Bank exceed the negatives.
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What are the positives and negatives of the Export-Import Bank in your option Abe?
 
#8
#8
abe hoffman said:
several years ago i was offered a position at the export-import bank. The salary, however, was less than i was receiving in tennessee. No way would i move to dc for less money even for what would have been an interesting job.

all things considered, the positives of ex-im bank exceed the negatives.
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lmao
 
#9
#9
n_huffhines said:
lmao
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Other than the article you posted that rambled on and on, you haven't really gone into detail as to why you oppose it Huff.

The economics side of this forum tend to pass me by, but I do read the threads and healthy debate as to why it should go can only help.

So what are the pros and cons in your opinion as well?
 
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#10
#10
Because I support a free market. It's really simple. I don't like government favoritism. I don't like government debt. I like a fair marketplace where the playing field is level in the eyes of the law.
 
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#11
#11
BTW, I didn't mean to sound like a d-bag, it was just funny to me that someone who works in banking would think its existence is a good thing.
 
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#12
#12
Gramps said:
What are the positives and negatives of the Export-Import Bank in your option Abe?
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The support of small and medium-size business efforts to engage in international trade is the primary positive. This is offset by the subsidies for corporations including Boeing and Caterpillar.

There is room to reform the Ex-Im Bank; however, the original mission is worthy of support.
 
#14
#14
Abe Hoffman said:
The support of small and medium-size business efforts to engage in international trade is the primary positive. This is offset by the subsidies for corporations including Boeing and Caterpillar.

There is room to reform the Ex-Im Bank; however, the original mission is worthy of support.
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This is what I can say about 95% of government endeavors. The problem is the outcome will never be worthy of support, just the intentions.
 
#16
#16
n_huffhines said:
Because I support a free market. It's really simple. I don't like government favoritism. I don't like government debt. I like a fair marketplace where the playing field is level in the eyes of the law.
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So could it be reformed like Abe just suggested for smaller start up companies that are trying to break into the international market or just do away with it all together? Like restrictions on the size of the company and all?

I agree that companies like Boeing and Lockheed-Martin could probably exist without it, but for smaller companies it could be beneficial. The article tends to be pretty biased towards the big corporations, but for the little guy, it seems like a pretty helpful tool. And when you're competing globally against other nationally subsidized industries, any advantage can help.
 
#18
#18
Grand Vol said:
So could it be reformed like Abe just suggested for smaller start up companies that are trying to break into the international market or just do away with it all together? Like restrictions on the size of the company and all?

I agree that companies like Boeing and Lockheed-Martin could probably exist without it, but for smaller companies it could be beneficial. The article tends to be pretty biased towards the big corporations, but for the little guy, it seems like a pretty helpful tool. And when you're competing globally against other nationally subsidized industries, any advantage can help.
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If you can't exist without it, your business shouldn't exist. Bottom line. Why should I be forced to subsidize your business. Why shouldn't you be forced to subsidize mine?

Anything can be reformed, but this presents big lobbying opportunities for big business, so it's doubtful that it could ever exist without loopholes for big biz.
 
#20
#20
Abe Hoffman said:
The support of small and medium-size business efforts to engage in international trade is the primary positive. This is offset by the subsidies for corporations including Boeing and Caterpillar.

There is room to reform the Ex-Im Bank; however, the original mission is worthy of support.
Click to expand...

Thank you Abe. I am not familiar with the Export-Impirt Bank. From you brief explanation I can understand how it can be useful to smaller businesses and how big business can abuse. Should it be reformed to help only those that the government classifies as small business
 
#21
#21
Gramps said:
Thank you Abe. I am not familiar with the Export-Impirt Bank. From you brief explanation I can understand how it can be useful to smaller businesses and how big business can abuse. Should it be reformed to help only those that the government classifies as small business
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Now you're giving an advantage to smaller businesses. Why is that fair?
 
#22
#22
n_huffhines said:
If you can't exist without it, your business shouldn't exist. Bottom line. Why should I be forced to subsidize your business. Why shouldn't you be forced to subsidize mine?
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There's a huge difference in subsidizing a business to keep it afloat and offering guarantees on foreign backed loans that expand your company.

And I see it not as much of subsidizing as it is loan guarantees from what I'm reading (researching while reading the thread). And why not help a small business break into international markets? From what I understand is the US Government is backing an international buyer to purchase a US made good which in turn keeps a US worker in a job and creates more jobs. You call it subsidies, but in reality it's nothing more than a loan that most banks won't permit given the international nature of the deal.

I'm looking at the default rate of only 1.5% (page 3) and that's pretty low for any bank. If it's generating a surplus (the horror of a government service making a profit lol) I can't see much wrong with this. There apparently is a 1% subsidy on loans however, so there is some fluff built into the loans and some economic factors that appear to be skewed according to some:

Critics of the Export-Import Bank Have a New Weapon at Their Disposal: Fair-Value Accounting | e21 - Economic Policies for the 21st Century

n_huffhines said:
Anything can be reformed, but this presents big lobbying opportunities for big business, so it's doubtful that it could ever exist without loopholes for big biz.
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I can't argue this point. But again in order to compete with companies like Airbus that are fully government subsidized, the loan guarantees are extremely helpful to keep our companies in business.

It just appears to me there are two sides of the coin here to be looked at. You're all about free market which I am as well. But I'm also about keeping Americans in a job and competitive on the global market against foreign companies that are receiving huge government subsidies.
 
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#24
#24
Grand Vol said:
There's a huge difference in subsidizing a business to keep it afloat and offers guarantees on foreign backed loans that expand your company.

And I see it not as much of subsidizing as it is loan guarantees from what I'm reading (researching while reading the thread). And why not help a small business break into international markets? From what I understand is the US Government is backing an international buyer to purchase a US made good which in turn keeps a US worker in a job and creates more jobs. You call it subsidies, but in reality it's nothing more than a loan that most banks won't permit given the international nature of the deal.

I'm looking at the default rate of only 1.5% (page 3) and that's pretty low for any bank. If it's generating a surplus (the horror of a government service making a profit lol) I can't see much wrong with this. There apparently is a 1% subsidy on loans however, so there is some fluff built into the loans and some economic factors that appear to be skewed according to some:
Click to expand...

Fair points, but if it's such a good deal, why aren't banks lining up for the loans? Why do we need a government program? Just ask yourself that.

And again, favored American businesses are given an advantage over non-favored American businesses. This is a huge negative, in my opinion.

Boeing can keep operating at a pace that defies the natural market, making it harder for new businesses to enter the market and compete. The easy way to secure monopoly power over time is through government. It's much harder to do through being the best business (and we like those kinds of monopolies anyways).
 
#25
#25
Gramps said:
Does the SBA give small business an advantage over large corporations?
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Do they enjoy a general advantage over big business? In most cases, no.

Does the SBA give them a relative advantage? Yes.

Businesses should be judged on their merits, not their size. The market is the judge. The market is by far the best judge that we have.
 
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