Export-Import Bank Funds Tiny Sliver of U.S. Exports
August 22, 2014
The taxpayer-funded Export-Import has been labeled "indispensable," and many Ex-Im supporters argue that the bank helps finance exports for small businesses that would otherwise be unsuccessful.
But Jim DeMint, president of the Heritage Foundation, writes that the real numbers behind the Ex-Im Bank show that the entity is hardly indispensable, and it is not small businesses that are being helped:
- Out of $2.2 trillion in American exports in 2013, less than 2 percent benefited from Ex-Im financing.
- Of that 2 percent, 75 percent went to just 10 companies, including Boeing and General Electric.
Neither Boeing nor GE are in need of taxpayer-funded financing; both could seek private funding for their projects.
Additionally, the bank supports less than half of 1 percent of small businesses in the United States. Moreover, the Ex-Im Bank's definition of a small business is misleading, writes DeMint, as it can include manufacturers with as many as 1,500 employees and firms with $20.5 million in annual revenue.
According to former Office of Management and Budget Director David Stockman, abolishing the Ex-Im Bank would only affect 0.6 percent of exports and 0.1 percent of gross domestic product. That, DeMint says, is an overly generous estimate, as the numbers reflect what would happen if all American overseas bids were lost as a result of abolishing the program.
DeMint writes that it is disingenuous to paint the Ex-Im Bank as a protector of small businesses. Moreover, he says the government should seek to level the playing field for all businesses, not pick winners and losers through selective government handouts.
Source: Jim DeMint, "Why Congress Should Dispense With the Export-Import Bank," Heritage Foundation, August 20, 2014.
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