Reporter's Notebook

Defunding the ExIm Bank
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Below are all the Atlantic notes, primarily from James Fallows, on the U.S. Congressional battle over defunding the Export-Import Bank.

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When Is It Fair to Call a Policy Position Idiotic?

Fred Hochberg, CEO of the now-defunded ExIm Bank (ExIm photo)

Last night I wrote an impolite item arguing something I actually believe: that the Tea Party-led effort to defund the Export-Import Bank represented the destructive triumph of ideological posturing over real-world effectiveness.

Summary version of the case: Sure, in principle, big, rich companies like Boeing, GE, and Caterpillar “shouldn’t” ever have to rely on taxpayer subsidy. Also, government support can bring gross corruption at worst and market distortion at best; and the public costs of mercantilist policies often outweigh the public benefits.

Those are the principles, which I recognize well enough from my economics courses.

But the principles are a poor match for real-world complications.

Because I have been wrapped up in print-magazine obligations (check your mailbox in one month, and subscribe in the meantime, including for our great new issue), I didn’t stop to mention the idiotic Congressional effort to defund the Export-Import bank while that debate was underway.

The anti-ExIm push has succeeded for now, and the results of this self-inflicted folly are starting to come in. The GOP/TeaParty case against ExIm was that it was another case of big government over-reach, and crony capitalism as well. As one of the Koch brothers-originated lobbying groups working against the bank piously puts it:

FreedomWorks explains it to us

Let’s not stop to marvel at this spectacle: an industrial combine whose mining, pipeline, refinery, and other operations have been intimately connected with, and frequently protected by, government policies, inveighing against the crony-capitalist state.

Instead let’s look at the results.