by Veronique de Rugy
June 16, 2014
Supporters of the Export-Import Bank (Ex-Im) argue that the federal government must subsidize American exports to “level the playing field” with foreign competitors who receive subsidies from their governments. Yet data from a new Congressional Research Service report on Ex-Im show that the U.S. government is actually one of the worst offenders when it comes to subsidizing domestic exports. Less than one-third of Ex-Im’s activities in Fiscal Year 2013 were dedicated to countering subsidized foreign competition, and less than two percent of the value of US exports are backed by Ex-Im – meaning that over 98% of US exports compete effectively in the global market without any such assistance! Other countries have maintained healthy exports with a small fraction of the United States’ spending on export credits. In short, the United States is far from a victim in the game of export credit subsidies. Support for Ex-Im on the grounds that it counters foreign subsidies is misguided at best.