Continuing my review and summarization of Project 2025, Chapter 24 covers the Export-Import Bank. It is one of the briefest chapters and actually has pro and con sections.
Background: The EXIM was established in 1934 during the Great Depression to provide subsidies to private companies that were exporting US goods and to foreign countries that were buying these goods with the hope of promoting US exports, creating jobs, supporting US businesses, and improving US competitiveness.
The con view states that the agency
1. Provides political privileges to already well-financed firms and that the US doesn’t improve its GNP by giving away its foods for less than it costs to make them, and subsidy-boosted exports do no boost economic growth.
2. Boeing gets a 40% share of the EXIM loans.
3. Other loans benefit large foreign companies that could easily get private financing such as Emirates Airline (surely the Saudis can finance their own airline, right?)
The pro side states
1. Even Ronald Reagan who opposed the EXIM, after taking office, had to admit that the EXIM “contributes in a significant way to our nation’s export sales.”
2. EXIM provides a mechanism that American companies can use to vie for projects that would otherwise be out of reach, notably deals that the banking industry won’t finance because of the risk associated with the host country or because the host nation itself requires a sovereign guarantee in order to submit a bid. EXIM is the only American vehicle that can provide that sovereign guarantee.
3. China has the most aggressive Export Credit Agency, and American companies risk losing out to Chinese competitors for international opportunities if EXIM is not there to offer support, but a United States without a functioning export credit agency also leaves an unchecked China with a wide-open field to claim jurisdiction over swaths of ocean and shipping lanes, expand its economic influence, and create major changes in the global balance of power.
4. EXIM loans are repaid with market-driven interest rates
