On Ex-Im Bank and Sequestration, GOP Has Inverted Its Principles
By a 313-118 vote today, 127 House Republicans voted with the near-entirety of the Democratic caucus–a lone Democrat voted no–to plunge an adrenaline-filled syringe into the chest of the defunct Export-Import Bank a la Pulp Fiction, in an attempt to resurrect the export finance agency from liquidation.
Today’s vote comes as a result of a “discharge petition” filed by Republican Rep. Stephen Fincher (R-TN) 72%, a sparingly used parliamentary procedure that circumvents the normal committee process–Rep. Job Hensarling, chairman of the Finanal Services Committee, refused to file a reauthorization bill–to force a vote on the floor of the House.
As I’ve explained elsewhere, the New Deal-era agency, originally designed to gin up export business between the U.S. and Soviet Union, is properly understood as a modality whereby businesses, most often massive and well-connected multinational corporations, secure taxpayer-backed loan guarantees or other forms of financing at below-market rates. Proponents of the agency claim that the agency is necessary to support American jobs and spur economic growth, though in reality, the bank simply transfers labor from unsubsidized to subsidized sectors, and only accounts for about 2% of total U.S. exports annually.
Whether one calls it “picking winners and losers,” or “market manipulation,” the effect is the same–taxpayers become an unwitting slush fund for companies who, by virtue of their huge market valuations, don’t need the help. It’s been three months since Ex-Im lost its charter and, lo and behold, our exports are churning along just fine. Amazing what markets can do when left unmolested.
In other news, a new budget deal announced early this morning between congressional leaders and the White House indicate that budgetary caps imposed as part of sequestration could become, as Kevin Williamson at National Review characterized it, yet another “federal accounting fiction“:
“Sequestration is the reason why in recent years we’ve reduced federal spending substantially in GDP terms, from about 25 percent to about 20 percent. It is the main reason that we have reduced the federal deficit in GDP terms. Democrat-supporting welfare entrepreneurs hated it, and Republican-supporting military contractors hated it. Ordinary Americans did not have much in the way of strong views on the matter, which often is the case when a policy actually does what it is supposed to. Effective government rarely is dramatic government.”
In short, sequestration is one of the few things genuinely working in Washington. So, naturally, Congress is trying to kill it.
If the GOP is, ostensibly, the party for free markets, limited government, and sound fiscal policy, this hasn’t exactly been anything like a banner week on Capitol Hill. Seeking to resurrect the Ex-Im Bank (which introduces unnecessary, artificial government distortions into our market economy), and vitiating the integrity of sequestration (an eminently functioning budgetary control in a city that all too often lacks such) on the GOP’s watch represents an unhealthy inversion of principles that threatens to further disenfranchise voters already weary of GOP feebleness.
After all, one expects Democrats to mercilessly expand government’s footprint, or otherwise pervert one of the few mechanisms that restrains it. Such is their compulsion. However, as there remain those of use who would like an alternative, it’d be nice if the GOP didn’t spend so much time acting as the Left does.
If this party can’t be trusted to dispense with small matters, can they be expected to show up in earnest for Social Security reform, or tax reform? Hard to see how. This week, if it’s instructive of anything, tells us not to hold our breath.