Export-Import Bank’s victims

From Timothy P. Carney of AEI.

"'The US Chamber of Commerce, the largest lobbying force in the country, will launch a million-dollar ad blitz in support of a key element of President Obama’s industrial policy—the Export-Import Bank of the United States. The Wall Street Journal’s Nick Timiaros tells the story today.

Ex-Im is a federal agency that subsidizes US exports through taxpayer-backed loans and loan guarantees to foreign buyers. Its charter expires June 30, and conservatives want to let it die, while the Obama administration, congressional Democrats, and some Republicans want to renew the agency.

WSJ’s Timiaros writes of the Chamber’s newest effort: “The campaign will highlight small businesses that rely on financing from Ex-Im and warn of job losses should the bank cease new lending.”

It’s relevant that small-business exports account for only about 20% of all Ex-Im financing, measured in terms of dollars. But it’s perhaps more interesting, economically, to point out that for every Ex-Im beneficiary the Chamber presents as part of its lobbying campaign, there is an Ex-Im victim.

It should be obvious—at least to Republican members—that Ex-Im doesn’t create wealth out of thin air. Instead, it does what government programs tend to do: it redistributes wealth, and thus redistributes jobs.

The beneficiaries are easy to spot: just read the list of Ex-Im subsidies grants last year. Ex-Im’s victims, while just as real, are harder to spot. The infographic below explains three different ways in which a US company might suffer from Ex-Im’s financing.

As members of Congress hear from the winners in their districts, they might refer to this graphic and recall the losers created by this government program.

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