June 30, 2015

Ex-Im Bank Charter to Expire at Midnight

Veronique de Rugy

George Gibbs Chair in Political Economy
Summary

Why, for the first time in more than eight decades, is the charter for the Export-Import Bank going to expire? The answer, according to Veronique de Rugy, one of the nation’s leading experts on the Ex-Im Bank, is that the American people are now standing up to cronyism.

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Unprecedented Action Comes in Response to National Backlash Against Cronyism

Arlington, Va.—Why, for the first time in more than eight decades, is the charter for the Export-Import Bank going to expire?   The answer, according to Veronique de Rugy, one of the nation’s leading experts on the Ex-Im Bank, is that the American people are now standing up to cronyism.   

“Today will be remembered as a day Americans stood up to powerful special interests and won,” said de Rugy, an economist and senior research fellow for the Mercatus Center at George Mason University.   “Americans are sick of cronyism, and the Export-Import Bank is the epitome of cronyism. Activists from the Tea Party to Occupy Wall Street agree that it’s time to put an end to the unhealthy marriage between government and big business.”

Supporters of the Ex-Im Bank claim it helps small businesses and exports. But 40 percent of the bank’s activities benefit one company, Boeing.  More than 60 percent of the bank’s financing is focused on helping ten large corporations, including Caterpillar and General Electric.  Overseas, the bank subsidizes businesses like Pemex, the massive state-owned Mexican oil company.  By contrast, less than 0.04 percent of American small businesses are helped by the bank.  

“Importantly, Ex-Im is just the tip of the iceberg,” said de Rugy.  “We’re going to see this same pushback throughout the economy.  The days of rubber-stamping cronyism are over.”  De Rugy, described by The Hill as “the leading academic opponent of Ex-Im,” has played a vital role in raising awareness about the bank.  She testified twice before Congress, has authored two papers on the subject, written dozens of op-eds and columns, published more than 40 charts, and penned nearly 80 blog posts. For a one-stop-shop compilation of all de Rugy’s work on the Ex-Im Bank, click here.