I basically copied and pasted the title from Veronique de Rugy, who got it herself from the Blog of the House Financial Services Committee – where Chairman Jeb Hensarling is leading the fight against the Export-Import Bank.
The Bank’s defenders insist that it’s all about helping American exporters, but they largely ignore the fact that most of the exports are intermediate products, which foreigners get with discounted loans from market rates. Thus, these firms have a leg up in competition against their American counterparts. The largest (and loudest) victim of this is Delta Airlines, which much compete with a slew of foreign airlines that get Ex-Im funded deals on Boeing airplanes that aren’t available to the American firm.
Lest anyone think this is the only example of Ex-Im run amok, the HFSC began daily highlights of the Bank’s loans. The first one was yesterday (I’m assuming they’ll continue on Monday). Here was the “Egregious Ex-Im Bank Deal of the Day” (HFSC, emphasis in original):
Hardworking American taxpayers, who are paying more for gas (“Gasoline prices at six-year high – AAA”) and “more for almost everything this year” (CNBC), might be wondering why President Obama refuses to approve the Keystone Pipeline but is using their tax dollars to finance foreign corporate welfare — like the nearly $5 billion in direct loans to help build a venture developed by Saudi Aramco, Saudi Arabia’s state-owned oil company.
This is the same Saudi Aramco, by the way, that one report this week said is “pulling the rug out from under the U.S. gas industry” and has announced plans to spend its money to build 11 45,000-seat capacity stadiums by order of King Abdullah.
Here are the deal details:
In 2012, the Ex-Im Bank provided a record-breaking $4.975 billion in direct loans to help build Sadara Chemical Company, developed by the Saudi Arabian Oil Company (Saudi Aramco). Saudi Aramco, the state-owned oil company of Saudi Arabia, is the world’s biggest oil company, with total assets reportedly in the trillions. – (Sources: Export-Import Bank press release, 4/4/13: “Sadara Chemical Company Transaction is Awarded Ex-Im Bank Deal of the Year”;Saudi Aramco; Forbes; University of Texas)
Please note the description of Saudi Aramco – the state-owned oil company of Saudi Arabia. Are we really supposed to believe that they needed Ex-Im’s help for financing?
Reminder: Senator Mark Warner joined all of his fellow Democrats in voting for the Ex-Im Bank’s reauthorization in 2012 (vote). His Republican opponent, Ed Gillespie, has called for it to be shut down.
Cross-posted to Virginia Virtucon