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Who Gains & Who Loses From Ex-Im Bank (In 2 Simple Maps)

Tyler Durden's picture




 

In an effort to expose the effect of Ex-Im Bank's financing (costs and benefits) on America, Mercatus Center has created 2 charts. Perhaps unsurprisingly, the maps show that Washington state, home of Boeing, garners the bulk of the benefits in terms of both Ex-Im Bank disbursements and as a percentage of total state export value, even though taxpayers across the nation are equally exposed to liability. This, among other reasons, is why killing The Ex-Im Bank is crucial to the future of capitalism.

Via Mercatus,

The first map shows that Washington state is the clear winner in terms of total Ex-Im disbursements, receiving a massive 43.6 percent of all Ex-Im Bank disbursements from 2007 to 2014. Washington is the home of Boeing, one of Ex-Im Bank’s biggest beneficiaries, but the sheer size is nonetheless startling. Larger states like Texas and California only respectively pulled in 10.5 percent and 8.8 percent of total Ex-Im Bank disbursements during the same time. An astounding 42 states received less than two percent of Ex-Im Bank disbursements, with 35 of these receiving less than one percent. While businesses in most states barely benefit from the Ex-Im Bank at all, their taxpayers are just as exposed to Ex-Im Bank liabilities as taxpayers in states that receive the most Ex-Im Bank backing.

The second map displays a similar pattern to the first. Washington state is again the big winner in terms of state export value supported, with an incredible 22.67 percent of state exports backed by the Ex-Im Bank since 2007. The state percentages drop off quickly from there. While almost four percent of Wisconsin’s exports and about 3.5 percent of Massachusetts’s exports were backed by the Ex-Im Bank, the Ex-Im Bank supported less than two percent of the exports of 41 states for the same time period.

The Ex-Im Bank yields negligible benefits for the vast majority of state exports. But the concentrated benefits it yields to a few beneficiaries makes the reform necessary to prevent widespread losses that much harder.

*  *  *

As we concluded previously,

So what is at stake in the Ex-Im battle is the future of market capitalism itself. If Washington lacks the capacity to say no to the shareholders of a few big US corporations that can be counted on one hand, then the statist predicate will triumph finally and for ever more.

 

Unfortunately, the script is already evident. When push-comes-to-shove during the run-up to the fall congressional elections, Speaker Boehner can be counted upon to come to the rescue of GE in his home state, and sell-out the tea party insurgents yet again.

 

And this time it will be game over. If the Ex-Im is given a new lease on life there will be no place for free market conservatives in the Republican party at all. Going forward, crony capitalism will be readily managed by the statist politicians who dominate the beltway regardless of notional party affiliation and banquet speech ideologies.

 

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Mon, 08/04/2014 - 20:50 | 5046869 junction
junction's picture

This is great to know if my name is Boeing.

Mon, 08/04/2014 - 20:52 | 5046883 Dutti
Dutti's picture

Another example of how the american taxpayer is subsidizing big business.

Mon, 08/04/2014 - 20:59 | 5046918 Greenskeeper_Carl
Greenskeeper_Carl's picture

david stockman already did an excellent article on this subject. The excuse the "european govts do it too" hold no water. The govt should have no role in this. The fact that we are borrowing nearly 40 cents on the dollar(or printing), means that we are adding billions to our debt, which the taxpayer will be expected to pay interest on FOREVER, is absurd. And the only reason we do this is to make money for boeings shareholders

Mon, 08/04/2014 - 21:18 | 5046992 Excursionist
Excursionist's picture

Dunno, Carl...  If everyone shows up to a fight with guns and you're holding a knife, no amount of idealism about what should or shouldn't will spare you a bullet-ridden corpse.

Mon, 08/04/2014 - 22:05 | 5047199 NoDebt
NoDebt's picture

Does EX-IM bank make money?  As a taxpayer I think I have a right to know that.  If it's fucking give-away to sell taxpayer-subsidized airplanes to other countries so Boeing can make a profit on them, let it burn.

Mon, 08/04/2014 - 22:14 | 5047236 Seer
Seer's picture

It's not even whether EX-IM makes money (well, it it were break-even then that's fair given that I don't htink that it's supposed to make money) as (and you note it correctly) it's about funneling subsidies.  And "subsidies" mean something that is not self-sustaining.  Anyone want to bet that those welfare companies, such as Boeing, got on this program and would never get off of it.

US govt funnels foreign "aid" through one door and money comes back from those recipient to entities like Boeing.  Meanwhile employment continues to slide...

Tue, 08/05/2014 - 10:46 | 5048755 N2OJoe
N2OJoe's picture

That's all great and happy that aid may "come back" through boeing but I suspect they don't pay taxes (just like GE) so is it really "coming back" at all?

Tue, 08/05/2014 - 00:38 | 5047611 Seer
Seer's picture

I fought a public project and heard plenty about how the pols stated that the money was there (state-wide legislation) and that everyone else was grabbing it too, so better to grab it and use it.

That was one of the last things I ever did to fight all this shit.  Let the fuckers run with the ropes, I'm getting out of the way of what will eventualy be swinging bodies...

Mon, 08/04/2014 - 22:57 | 5047386 Urban Redneck
Urban Redneck's picture

If you believe that the European governments also doing this is irrelevant, then perhaps you also gullible enough to believe that price which you ask for your product is not a factor in whether you sell the product. That is also a completely different matter than whether any government should have a role in export finance.

ExIm needs to fixed and neither Boeing nor GE needs ExIm, but can we dispense with the BHO-level claptrap?

Mon, 08/04/2014 - 20:56 | 5046903 zorba THE GREEK
zorba THE GREEK's picture

Simple rule of thumb: Banks always gain and we always lose.

Mon, 08/04/2014 - 22:15 | 5047237 Seer
Seer's picture

That would be BIG banks.

Tue, 08/05/2014 - 00:41 | 5047616 TeethVillage88s
TeethVillage88s's picture

Ya all should look at BRAC Legislation and Gerrymandering.

Power wins in the US Congress and that means lobbying and even foreign lobbying.

Base Realignment and Closure Legislation

Base Realignment and Closure Commission for U.S. military bases

1988 Base Realignment and Closure Commission
1991 Base Realignment and Closure Commission
1993 Base Realignment and Closure Commission
1995 Base Realignment and Closure Commission
2005 Base Realignment and Closure Commission

- Congress is spending like a Drunken Sailor
- Congress may actually be Drunken Sailors
- Congress is high on Libations and qualifies as Drunken Sailors

- We need Inspections, Audits, Investigations, and Independent Auditing in all of our Federal Government Agencies

- We have Federal Offices to Inspect, but they are not doing their Jobs, they need to be Fired and sometimes prosecuted. Word. Think government contract inflation while official stats say there is no inflation, but oh look Public & Private Executives Pay is Inflating along with Contracts. Wow.

Mon, 08/04/2014 - 20:52 | 5046880 thamnosma
thamnosma's picture

Also helpful would be a breakdown by sector.  How much of this is MIC?

Mon, 08/04/2014 - 20:52 | 5046882 flyonmywall
flyonmywall's picture

"It doesn't matter who votes, it matters who counts the votes." - Iosif Vissarionovich Dzhugashvili, a.k.a. Josef Stalin

Forward !

 

 

Mon, 08/04/2014 - 20:55 | 5046888 Dr. Engali
Dr. Engali's picture

There never was any room for free market conservatives in the repukeagain party. Sure the party paid lip service to them, but they used them towards their own ends then discarded them like an old dirty worn out rubber.

Mon, 08/04/2014 - 22:38 | 5047330 NidStyles
NidStyles's picture

All patrons of state are known for the characteristic of being useful idiots. No matter what creed of state it is, they are complicent in it's survival. 

Mon, 08/04/2014 - 20:54 | 5046890 Seer
Seer's picture

Boeing is headquartered in, wait for it... Chicago!  From http://www.boeing.com/boeing/companyoffices/aboutus/brief.page

With corporate offices in Chicago, Boeing employs more than 169,000 people across the United States and in more than 65 countries.

Mon, 08/04/2014 - 21:09 | 5046962 potato
potato's picture

All the Boeing engineers i know work in Washington state.

Mon, 08/04/2014 - 21:14 | 5046983 Seer
Seer's picture

Still don't make Boeing a Washington State company, does it?

It's how TPTB keep the story-lines alive, they never change things like this...

Tue, 08/05/2014 - 01:52 | 5047707 Nobody For President
Nobody For President's picture

Doesn't matter - the exports from Washington State are very big on Boeing, and they get the jobs and such that go with it.

 

http://www.bellinghamherald.com/2014/02/11/3470846/washington-state-sets...

(2013 data)

WA is fourth on the total export dollar value, but first in EX-IM aid - and BAC is the reason why. 

Mon, 08/04/2014 - 21:10 | 5046963 nobodyimportant
nobodyimportant's picture

the wreckage of the airplane in Urkraine does not appear to be a boeing 777.

MH17 canceled.

Wreckage does not dent the ground.

What's up with that?

Mon, 08/04/2014 - 21:31 | 5047026 Berspankme
Berspankme's picture

Has CNN found MH370? They were talking about a black hole. Anybody check Oprah?

Mon, 08/04/2014 - 22:00 | 5047178 medium giraffe
medium giraffe's picture

Panic over, it's been found alive and well parked in Tel Aviv.

Phew.

Mon, 08/04/2014 - 21:52 | 5047128 ekm1
ekm1's picture

USA is about 80% communist country.

Exim bank will live.

Period.

Tue, 08/05/2014 - 00:33 | 5047214 Seer
Seer's picture

"USA is about 80% communist country."

And that means what, exactly?

ALL EMPIRES collapse.  There's a basic pattern, Sir John Glubb wrote about it (covering some 3,000 years of history):

http://www.rexresearch.com/glubb/glubb-empire.pdf

Excerpt:

Today we attach immense importance to the ideology of our internal politics. The Press and public media in the U.S.A. and Britain pour incessant scorn on any country the political institutions of which differ in any manner from our own idea of democracy. It is, therefore, interesting to note that the life-expectation of a great nation does not appear to be in any way affected by the nature of its institutions. Past empires show almost every possible variation of political system, but all go through the same procedure from the Age of Pioneers through Conquest, Commerce, Affluence to decline and collapse.
Mon, 08/04/2014 - 22:02 | 5047187 Felix qui potui...
Felix qui potuit rerum cognoscere causus's picture

EX Im has assisted many a small / medium size business.  Mine for one. 

Allows us to compete against the Europeans and Asian businesses.  Get rid of it and we loose. 

 

Mon, 08/04/2014 - 22:07 | 5047205 NoDebt
NoDebt's picture

Details, please.  Can't make a statement like that without putting your balls up on the table for a thorough examination.

Tue, 08/05/2014 - 08:06 | 5048004 Toosday
Toosday's picture

I am correcting your pronoun usage.  

EX Im has assisted many a small / medium size business.  Mine for one. 

Allows me to compete against the Europeans and Asian businesses.  Get rid of it and I lose. 

 

I fail to see how I win if you are using taxpayers risk capital to finance private activity that results in private profits.

Mon, 08/04/2014 - 22:14 | 5047234 Felix qui potui...
Felix qui potuit rerum cognoscere causus's picture

A major project in Brazil, the Australian Embassy in Jakarta.  We are an over 100 year old company who has increased exporting by 200% by using Ex Im and SBA.  Google Acquario/ EX Im

Mon, 08/04/2014 - 22:18 | 5047254 Seer
Seer's picture
U.S. gives billions of dollars in foreign aid to world's richest countries - then asks to borrow it back Read more: http://www.dailymail.co.uk/news/article-1393960/US-gives-billions-foreign-aid-worlds-richest-countries-asks-borrow-back.html#ixzz39TpFQ3Hw

The U.S. is providing hundreds of millions of dollars of foreign aid to some of the world's richest countries - while at the same time borrowing billions back, according to report seen by Congress.

The Congressional Research Service released the report last month which shows that in 2010 the U.S. handed out a total of $1.4bn to 16 foreign countries that held at least $10bn in Treasury securities.

Four countries in the world's top 10 richest received foreign aid last year with China receiving $27.2m, India $126.6m, Brazil $25m, and Russia $71.5m.

Mon, 08/04/2014 - 22:46 | 5047356 brown_hornet
brown_hornet's picture

Seer- Those are the bribe amounts.

Tue, 08/05/2014 - 00:32 | 5047607 Seer
Seer's picture

Yup.

Tue, 08/05/2014 - 02:37 | 5047742 NOZZLE
NOZZLE's picture

Still trying to figure out how Malaria Airlines had two 777s to loose and your flying American Airlines on some corroded hulk that Don Draper puked in 40 years ago?

Tue, 08/05/2014 - 04:15 | 5047816 mc225
mc225's picture

the puget sound region is thriving. a lot of people are hoping for an upturn. there was never any big downturn, the way there was in other parts of the country. traffic here is insane; there is far more traffic than these roads were ever designed for; the roads are falling apart faster than municipal maintenance crews can keep up. people are generally happy. there aren't a lot of naysayers out there. most people are of an 'onward and upward' attitude. we have a lot of vietnamese and thai restaurants. soon, i'm hoping to try the fish tacos at the mexican drive-thru. once, i was working at a mini-mart near the renton boeing plant, and a boeing employee stopped through and said that boeing sold their commercial stuff at a loss, and made up for it with military contracts. ymmv

Tue, 08/05/2014 - 08:02 | 5048002 J J Pettigrew
J J Pettigrew's picture

THe Ex Im bank loaned Petrobras $2 billion..... then Petrobras paid out its dividend.

Any quesitons?

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