For reasons I don't understand, this week much of the journalism establishment has been in full, unconcealed panic mode about the (probably temporary) failure of the Export-Import Bank. Here is the latest such piece.
The principles behind every defense of Ex-Im that I've seen are as follows:
Not every Ex-Im defender employs every principle above, but they all use at least one or two of them.
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The principles behind every defense of Ex-Im that I've seen are as follows:
- 160,000 jobs in gross terms is a lot (I'll set aside questions about how that number was produced)
- We should judge government policies by whether they turn a profit. Turning a profit is a key purpose of government policy.
- What is good for big corporations is good for workers. Corollary: CEOs of big corporations know what's best for the broader economy and selflessly advocate it publicly.
- Judge a policy's impact on small business by what portion of its transactions affect small businesses, not by what portion of its activity affects small businesses OR by what portion of total US small businesses are affected. Also: Small businesses deserve special subsidies.
- In our economic policy, we should seek to emulate China. Update Another way to say this: The US should accumulate enough corporate welfare policies to match those of all other countries. Export-Import Bank Advisory Committee member Caroline Freund describes this principle as a "level playing field"; another term might be "race to the bottom".
- Exports are special and deserve subsidy.
Not every Ex-Im defender employs every principle above, but they all use at least one or two of them.
I would say that point 1 is totally bogus (see here), and point 4 makes little sense. The others are matters of opinion, and I'm writing them here so we can judge whether Ex-Im's defenders are consistent in their use of these principles across policies. More broadly, if these principles are good policy justifications then imagine what other sorts of policies could be defensible.
Are there any points I missed?