The charter of the US Export-Import Bank is set to expire on June 30 unless it is reauthorized by Congress. Scare tactics aside, the end of Ex-Im would not mean the loss of thousands of American jobs. Economists have long understood that subsidies doled out by government credit agencies such as the Ex-Im Bank are not merely unnecessary: they can actually harm the economy. In their quest to keep the subsidies flowing, proponents of the bank are claiming that failure to reauthorize its charter would lead to massive job losses. This blatant fearmongering has succeeded in causing concern among some lawmakers.
The cause of last week’s tragic crash of Amtrak train 188 in Philadelphia remains unknown. Some policymakers and pundits immediately pinned the blame on a lack of federal funding for the government-owned and -managed passenger rail operator. This week’s chart shows the annual amount of federal operating and capital funding that Amtrak has received since it was created by the Rail Passenger Service Act of 1970, including a generous allocation in 2009, as part of the American Recovery and Reinvestment Act (ARRA).
Using the bank’s own data, the chart shows that, of the total amount of financing authorized by the Ex-Im Bank from FY 2007 to FY 2014, only 23 percent benefitted small businesses. Minority-owned and women-owned firms received a paltry 2 percent and 1 percent, respectively. While government programs should operate on the principle that everyone is “equal under the law,” it would seem that this principle does not apply to the Ex-Im Bank’s export subsidies.
In spite of their complaints about federal overreach, state policymakers are addicted to handouts from Washington because it allows them to spend “free” money instead of asking their constituents to come up with funds via higher taxes. Unfortunately, federal money is not “free,” and the consequence of the federal government’s funding what are properly state and local responsibilities is excessive growth of government at all levels.
This week’s chart shows total funding for the Department of Defense from fiscal year 1948 to fiscal year 2015 in inflation-adjusted 2015 dollars. Funding for the OCO account, first delineated following the 9/11 terrorist attacks, is separated out.
This week’s main chart shows that both proposals would reduce the growth in spending versus the Congressional Budget Office’s baseline. On the House side, spending would go from $3.8 trillion in fiscal year 2016 to $5.1 trillion in fiscal year 2025 for a total of $43 trillion over ten years.
The following charts are the third in a series looking at the top foreign buyers of exports financed by the US Export-Import Bank (Ex-Im) from FY 2007 to FY 2013. The first new chart shows the total dollar amount of deals financed by Ex-Im in which the primary buyer was listed as being “unknown” or “various” in data made available to the public. It shows that 33 percent of the deals in Ex-Im’s public database used these vague labels.
The following charts are an update to my previous chart, which showed the top 10 foreign buyers of exports financed by the US Export-Import Bank from FY 2007 to FY 2013. That chart noted that foreign oil and airline companies dominated the list. The first new chart shows the top foreign oil companies that have purchased Ex-Im–financed exports during that time, based on the total amount of financing authorized. The second new chart provides the same information for foreign airline companies.
Using a dataset that the US Export-Import Bank recently made available to the public, one can see which foreign companies are among the top purchasers of American exports financed by the bank’s subsidy programs. The following table shows the top 10 foreign buyers, based on the total amount of financing authorized from fiscal years 2007 through 2013.