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Manipulating Capitalism & Killing Jobs: The US Export-Import Bank

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Posted on June 29 2010 6:00 pm
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OK, I am ready to admit it; like many of you, I am no expert on economics and had never even heard of the US Export-Import Bank (Ex-Im Bank) until recently. Looking into some of its recent activities, though, I realized it has had the ability to manipulate capitalism since it’s very creation by FDR in the 30’s and has been used extensively by those who knew how. Obama is apparently one of them.

Just this past week (H/T Gateway Pundit), the Ex-Im Bank has turned down financing which will cause a loss of 1000 jobs in the US coal industry. We’re doing this in an economy with sky high unemployment and energy issues? It’s no surprise that this move lines up perfectly with Obama’s energy agenda. In fact, Export-Import Bank Chairman Fred Hochberg himself stated:

President Obama has made clear his administration’s commitment to transition away from high-carbon investments and toward a cleaner-energy future. After careful deliberation, the Export-Import Bank board voted not to proceed with this project because of the projected adverse environmental impact.”

In another example, their proposed loans to Brazil for deep water drilling have been harshly criticized, as our own nation is told we cannot do the same or anything even close to it. This is a plan that is supposed to benefit the US economy? Well, not so much, but it definitely benefits the right investors in Petrobras, including… radical leftist billionaire George Soros.

The bank’s site say it’s self-sustaining and that taxpayer money is not involved. However, that doesn’t help me feel better about their manipulative activities, with a board appointed by the President. The bank also points out that the Petrobras deal was in the works before Obama appointed his people. Right. I’m afraid, though, that this doesn’t take away my concerns either. After all, it’s still market manipulation, no matter who is president when a project starts.

Ian Vasquez of the Cato Institute recognized the problem with the Ex-Im Bank, both economically and constitutionally. He had this to say back in 2001:

It is time Congress retire the Export Import Bank in recognition that the Great Depression-era agency has no relevance in an increasingly liberal world economy. The Bank benefits a small number of firms at the expense of the rest of us. It does not correct for so-called market failures, but does create perverse effects at home and abroad, including by imposing opportunity costs and discouraging the spread of market reforms. The tiny percentage of exports that the Ex-Im Bank helps to counter subsidized competition overseas, moreover, demonstrates that the U.S. economy does not suffer from the lack of a level playing field. Most important, Congress should not finance this negative sum game because it is nowhere authorized in the Constitution to use taxpayer funds to benefit politically favored groups.

For those who have questioned the system of capitalism, I would suggest that the US Export-Import Bank, along with the Federal Reserve and many other governmental manipulations, have caused many of the problems with capitalism we now have. As is often the case, less government intervention in the economy would benefit us all. As it is, all the Export-Important Bank is doing is killing jobs – with Obama’s blessing.

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