Conservatism Inc. Uselessness: Who Cares About Amnesty? We Won On The Export-Import Bank!
On May 12-13, 1865, over a month after Lee surrendered at Appomattox and the Civil War was all but over, Confederate Colonel John Salmon Ford repulsed Union forces led by Colonel Theodore Barrett in the Battle of Palmito Ranch. In a war that took the lives of over 600,000 Americans, only four soldiers died in that battle. Three weeks later, the final Confederate troops surrendered.
If Conservatism Inc. was leading the Confederacy, it would be celebrating Palmito Ranch as a great victory and ignoring the larger surrender. Case in point: Beltway Right jubilation over the Export Import Bank’s [Ex-Im] temporary lapse of authority. (The “AUTHORITY HAS LAPSED” image above is what you see when you go to their web page.)
Consider everything else that happened in the last few days: The Supreme Court, composed of a majority of GOP-appointed justices, upheld disparate impact, approved Obamacare, and imposed gay marriage on the entire country. Over some conservative objections, the Republican Congress awarded President Obama expanded trade authority. Meanwhile, Obama successfully exploited the Dylann Roof shooting to demonize the Confederate Flag in particular and conservatives in general. The leftist Independent Weekly chortled it was “Conservatives’ horrible, no good, very bad week—now with gay marriage!” [by Jeffrey Billman, June 26, 2015]
Yet American Enterprise Institute’s Timothy Carney cheered at The Washington Examiner about “an early and visible victory for the GOP’s free-market forces over the forces of K Street, which for so long held a monopoly on the party” [Corporate welfare takes a blow, June 30, 2015]. Heritage Action triumphantly declared: “Change doesn’t come fast or easy in Washington, but over the past three years conservatives created the conditions that caused the Export-Import Bank to expire and enter liquidation” [We did it! Export-Import Bank Expires Tonight , Heritage Action, June 30, 2015]. The Heritage Foundation’s Jim DeMint called it a “win to consumers, and taxpayers can now look forward to a shrinking threat of bailouts” [Statement from Heritage President Jim DeMint on Expiration of the Export Import Bank, Heritage Foundation, July 1, 2015]. Reason’s Nick Gillespie celebrated it a “victory against corporatism at its worst” [Crony-capitalist export-import bank loses authorization for First Time in 81 Years!, July 1, 2015]
Other groups joining in the festivities included:
- National Review : Ex-Im is Kaput, by Patrick Brennan, July 1, 2015
- The Washington Times : Shut down the Export-Import Bank, by Veronique de Rugy, June 29, 2015
- The Cato Institute : Export-Import Bank Closes: Kill Subsidies to Cut Federal Liabilities, Promote Economic Fairness, by Doug Bandow, CATO, June 30, 2015
And they weren’t alone.
Of course, rather than triumphing over corporatism at its “worst,” it would be more accurate to call this a victory over corporatism at its smallest. Even Reason’s Gillespie acknowledges the Ex-Im may be reauthorized in a matter of weeks. But even if it is abolished, it’s no real victory.
What exactly does the Export Import Bank do? Last year, Ted Cruz wrote, “To most Americans, the words ‘Export-Import Bank’ don’t mean very much” [Ted Cruz: Obama backs corporate welfare, USA Today, July 30, 2014]. Nor is there any reason it should mean more to Americans than the names of any of the other 2,000 or so government agencies, the majority of whom I suspect Cruz cannot name.
To over simplify, the bank guarantees loans to foreign investors who purchase products from American manufacturers. In a federal government with over a $3.5 trillion yearly budget and over 4 million employees, the Export Import Bank has a budget of 90 million dollars (that’s less than 1/400 of one percent of the total budget) and employs 400 workers [The misleading debate on the Export-Import bank, by Robert J. Samuelson, The Washington Post, July 1, 2014].
Opponents often point to the Bank’s 113 billion dollars in loan guarantees, but this money is paid back, and indeed it has made a profit. Tim Carney argues, with different accounting, that the Ex-Im would have cost an average of $200 million a year over a decade, but that is still just pennies in the federal budget [Export-Import Bank 101: The ‘it makes a profit’ argument, Washington Examiner, July 29, 2014]
Many conservatives pejoratively call the Ex-Im the “Boeing Bank” and note that 87% of the loan guarantees end up benefiting Caterpillar, General Electric, and Boeing [The expiration of the Export-Import Bank, explained for those who don’t know what that is, by Amber Phillips, Washington Post, June 30, 2015]. Of course, Boeing receives over $20 billion in government contracts each year directly, far more than the total yearly cost of Ex-Im even under Carney’s accounting standards.
Cruz thundered in the USA Today article above: “The DC insiders, cozy with international corporate interests putting taxpayers on the hook for hundreds of billions of dollars in subsidies, want to keep it that way, too.”
But Ex-Im is so small that most lobbyists—just like most Americans—don’t have a dog in the fight. I have discussed this issue with a number of lobbyists, and rather than being afraid that Americans are standing up to crony capitalism, most are just confused and/or amused that anyone cares about such a trivial agency. And while some Boeing lobbyists care about keeping it, there are other corporate interests, such as Delta, who are spending millions lobbying against it [Boeing and Delta spend millions in Fight over Export-Import Bank’s Existence, by Jonathan Weisman and Eric Lipton, New York Times, April 6, 2015].
Yet for some reason, Conservatism Inc. has characterized this agency as
- “A corrupt, near-rogue organization that wagers billions of taxpayer dollars per year” [The Ex-Im Bank: Crony Capitalism in Action, National Review, June 25, 2014]
- “A font of cronyism beset by mismanagement and dysfunction” [Ex-Im Bank and the Bigger Fight Against Cronyism, by Diane Katz, Heritage Foundation, July 8, 2014].
- “A slush fund for political favors and a hugely distorting force within marketplace” [AFP leads broad coalition standing against the Export-Import Bank, Americans for Prosperity, May 5, 2014]
I agree with Export Import Bank critics that most of these corporations do not need help. Moreover, both GE and Caterpillar support Amnesty, so I’m not eager to help them out [Immigration Reform, Caterpillar, Accessed July 2, 2015].
Yet unlike the majority of Fortune 100 companies, they actually produce something. And unlike virtually all other Fortune 100 companies, they make most of their products in America.
The same cannot be said of the corporate welfare found in trade deals, which often give direct subsidies to foreign companies competing against American workers. That conservatives are celebrating their victory over the Ex-Im the same week that they gave Obama unprecedented fast track authority to negotiate these trade deals is revealing. In fact, National Review, the Cato Institute, the Heritage Foundation, Mitch McConnell, Kevin McCarthy, and many of the Conservatism Inc. opponents of Ex-Im went on to lead the fight for TPP.
Indeed, they failed to see the conflict. Thus, chairman of the House Financial Services Committee Jeb Hensarling argued in National Review: “TPA is about bringing down trade barriers; Ex-Im is about entrenching them, not to mention providing a form of corporate welfare” [The conservative case for trade promotion authority, June 8, 2015].
This is to say nothing of the ultimate corporate welfare program: mass immigration. Corporations get cheap labor, while taxpayers are forced to pay for the actual welfare and other social costs the immigrants impose on the country.
That the same conservatives and Republicans who lobbied for Obamatrade and refused to defund the Executive Amnesty are now bragging about standing up to the Chamber of Commerce and Big Business over a trivial agency epitomizes Conservatism Inc.’s uselessness.
Perhaps the comparing Conservatism Inc. to Confederates at Palmito Ranch is unfair to Colonel Ford—the Beltway Right would have surrendered long before Lee.
I suggest that patriotic Americans instead look to Jesse James: admit the war is lost, and start an insurgency.
Washington Watcher [email him] is an anonymous source Inside The Beltway