Ron Paul Economic Superiority: GOP Show They're Hypocrites With Export-Import Banks
Ron Paul is not going away, but he is shifting his focus. Even while Mitt Romney’s nomination as the GOP presidential nominee seems to be a foregone conclusion, Paul is continuing to draw delegates and is looking to use this success to bring about “a change in direction for the Republican Party.”
Judging by Wednesday’s vote in the House to reauthorize the Export-Import Bank, which was supported by 147 Republicans, a change in direction is much needed. The willingness of Republicans to support the Export-Import Bank (Ex-Im) shows that Paul’s limited government views are needed to remind the GOP what opposition to wealth redistribution actually entails.
Ex-Im is the official export credit agency of the U.S.. The mission of the Bank is to create and sustain U.S. jobs by financing sales of U.S. exports to international buyers.
American industries have lobbied to keep Ex-Im in existence because it boosts the ability of foreign nations to import their goods, and politicians have been receptive because of Ex-Im’s political benefits. For instance, South Carolina Representative Jim Clyburn argues that "The Export-Import Bank fills an important financing gap for Boeing that helps level the global playing field and encourages foreign companies to buy American-made products like the Dreamliner.”
Clyburn also lauds Ex-Im for protecting jobs in South Carolina by encouraging foreign nations, through subsidies, to buy what these Boeing employees in South Carolina produce. It’s a win-win for Boeing who benefits from subsidies other industries do not get, and for Clyburn who can talk about all of the jobs he is protecting in South Carolina.
As Cato Institute scholar Sallie James points out, however, the industries supported by Ex-Im are not really “sure bets,” and this is demonstrated by unwillingness of private financiers to fund them. Ex-Im subsidizes industries that the private sector chooses not to invest in due to concerns about their profitability, and as a result, props up otherwise uncompetitive industries with taxpayer dollars.
Paul has been an ardent opponent of Ex-Im as a form of corporate welfare. In a 1997 speech, Paul lamented the resources taken from the private sector to “support the less efficient companies living on government subsidies.” Paul understands that, without Ex-Im, all companies would be pressured by the market to find ways of being profitable on their own, because they would not be able to depend on U.S. subsidized importers to buy their products. This would leave all industries in an equal position to compete and allow Americans to use their resources as they wish, and support the industries they actually believe are worth supporting.
As the overwhelming support for Ex-Im among Republicans shows, a good portion of the GOP has chosen to abandon its support for American taxpayers. Republicans that supported reauthorization, such as those in South Carolina that are looking out for Boeing, have placed the interests of corporations above those of American taxpayers. The GOP, if it is truly committed to reducing the burden of taxation on Americans, should learn from Paul’s opposition to Ex-Im and stop redistributing taxpayer dollars to other nations just so their favorite corporations can be kept from having to survive on their own, all at the expense of taxpayers.