Senator Rand Paul (R-KY) has stepped up to the plate to fight reauthorization of the crony capitalist Export-Import Bank. I wrote yesterday that the Tea Party is losing on this issue despite the heroic efforts of Rep. Tom McClintock (R-CA) and other members who agree that the Ex-Im Bank is a high offense against free market capitalism.
The Export-Import Bank was created in 1934 by FDR to facilitate trade between the United States and other nations. It has become an institution where foreign entities receive loans to buy goods from government favored U.S. companies. The Ex-Im Bank is corporate welfare plain and simple.
House Republicans and Democrats held hands to pass this legislation on a 330-93 vote yesterday. The legislation extends the life of the Ex-Im Bank and adds $40 billion in loan authority. The bill came over to the Senate today and Senate Majority Leader Harry Reid (D-NV) immediately tried to pass the bill.
The Hill reports that Reid wanted to sneak the bill through the Senate without a recorded vote.
Senate Democrats are hoping to follow their counterparts in the House and quickly pass legislation renewing the Export-Import Bank on Thursday. Senate Democrats hope to pass H.R. 2072, the Securing American Jobs Through Exports Act, by unanimous consent, according to a Senate Democratic aide.
It looks like many Republicans have embraced the Ex-Im Bank. Tim Carney writes in the Washington Examiner today that Republicans are joining President Obama and Democrats to embrace crony capitalism.
On Wednesday, a large majority of Republican congressmen voted to reauthorize Ex-Im (whose current charter expires later this month) and increase to $140 billion the legal limit on taxpayer exposure from Ex-Im financing. Currently, taxpayers are exposed to nearly $100 billion in Ex-Im loans and loan guarantees. By supporting Ex-Im, instead of trying to kill it, Republicans aren’t merely calling into question the concept of free enterprise, they are passing up the chance to make President Obama’s corporate welfare a central theme of the 2012 election. The stage had been set, economically and politically, for the GOP to wage a free-market populist campaign against Obama.
Daniel Horowitz argues that opposing crony capitalism and corporate welfare should be low hanging fruit for Republicans.
Headed into this election, we have a golden opportunity to draw a sharp contrast with Obama on the issue of government involvement on behalf of corporations, otherwise known as crony capitalism. While we have a long way to go in educating people about the vices of personal entitlement programs, we have already won the political battle against corporate entitlements. So why won’t Republicans pocket the victory and oppose all corporate welfare?
There is still a slim chance that the bill authorizing the Export-Import Bank fails in the Senate when they vote next week. If conservatives can convince Republicans to abandon the idea that taxpayer backed loans should be used as a means to reward large corporate interest to the detriment of non-government favored corporate interests.
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