One of the new causes of the Republican populist right and Democratic populist left appears to be the same: the dismantling of the Export-Import Bank.
It is interesting that these two groups meet on this point.
Is it true that the people who cluster at both ends of the political spectrum tend to have a suspicious nature.
It sees these entities as inherently conspiratorial — perhaps because of their names and somewhat opaque structures; or maybe because they are identified with Harvard and other elite eastern institutions.
The left does not seem to like the Ex-Im Bank because it is set up to assist businesses that do “big business,” especially “big international business” with “international big businesses.”
The left does not see much value in “big” business, its bigness being self-evidently more malevolent to their eyes than it is in the case of, for example, “big” government.
Big business does things for profit and there is no social justice in that, just people making money and doing other bad stuff.
Thus both sides meet in their general opposition to things like the Ex-Im Bank, which check all their boxes of ideological concern. As a side benefit, this opposition delivers limitless opportunities for one-liners that can fire up a base-dominated crowd at political events.
Thus, re-authorizing the Ex-Im Bank has become a bit of a political hang-up.
This is ironic if one views the role of the bank fairly.
The bank does not, in fact, aid foreign countries, governments or businesses. It plays precisely the opposite role.
By allowing American companies, mostly very large ones, to finance the products they want to sell to a foreign company or government at a reduced rate, the Ex-Im Bank in fact represents an American commercial threat to foreign companies. It is the antithesis of foreign assistance.
There will always be “big business,” for the very simple reason that in some cases it just takes big business to build big things, such as construction equipment and airplanes.
The question is not whether such businesses will exist. The question is who will get the jobs spawned by their activities: us, in the United States; or them, in other countries?
Part of the answer is determined by who offers the best price.
This is where the Ex-Im Bank gives our guys — the guys who employ Americans — a better chance to compete.
This is especially true since most of the rest of the industrialized world, especially France, Germany, the United Kingdom, Japan and China, do a lot more table-tilting than we do, with direct and indirect government help for their “big businesses.”
More substantive is the right’s concern that the bank’s activities amount to the government picking winners and losers, and supporting the big boys with influence.
To be fair, this is basically true. But what is the real cost of such support?
It is very little, so far as the taxpayer is concerned. In fact the Ex-Im Bank returns a few billion dollars a year to U.S. taxpayers.
This added income can then be spent by the same members of Congress who oppose the bank on really expensive industrial policy, such as agriculture subsidies or energy tax breaks.
These programs are industrial policy on steroids.
But they also come free of talk about foreign activities and banks, and other such things that raise the heckles of the conspiratorially-minded.
In a perfect world, where the playing fields of international commerce are level, the Ex-Im Bank should be scrapped. But such a world does not exist. It is not going to come into existence anytime soon.
Dumping the Ex-Im Bank would provoke some celebratory chest-beating by those who reside at the extremes of right and left. But it would also bring on more federal debt, as the costs currently covered by the contributions of the Ex-Im Bank to the U.S. Treasury Department would have to be covered by borrowing.
It would also result in the loss of many American sales, which would instead be racked up by subsidized foreign competitors.
This, in turn, would bring the distinct possibility of the loss of American jobs — either directly due to the loss of sales, or indirectly, because of the need to move production overseas to become more competitive.
Some claim that this will not happen because the companies that use Ex-Im financing can easily get financing without government back-up.
This may be true. But, then again, it may be false.
By the time the jury returns its verdict, the sales may be lost, the jobs may be gone and the Treasury department will definitely be poorer.
Judd Gregg (R) is a former governor and three-term senator from New Hampshire who served as chairman and ranking member of the Senate Budget Committee and as ranking member of the Senate Appropriations Foreign Operations subcommittee.