The battle over the reauthorization of the Export-Import Ban has provided more than enough evidence that some of America’s biggest companies feel they’re entitled to help from the federal government in boosting their profits. As the bank’s biggest beneficiary, Boeing has been leading the charge, claiming that, in spite of being the No. 1 exporter in America, earning record profits, having a large financing arm and a $99.29 billion market cap (as of today), the company will suffer a great deal without reauthorization. It’s even suggested it may move operations to another country if Ex-Im isn’t brought back.

That hasn’t worked so far, so now the battle for Ex-Im reauthorization is moving to phase two: making lawmakers feel guilty that the company may not make as much money as it could with its subsidies. According to anonymous sources, the lack of export subsidies is about to cost the company a major deal:

Boeing Co is scrambling to find alternate financing for a satellite contract worth “several hundred million dollars” that was scuttled by privately held commercial satellite provider ABS due to uncertainty about the future of the U.S. Export-Import Bank, three sources familiar with the matter said on Tuesday.
ABS, based in Bermuda and Hong Kong, terminated its order for the satellite in mid-July, citing the expiration of the trade bank’s charter on June 30, according to the sources, who asked not to be named given the sensitivity of the issue.
The termination marks the first known casualty of the ongoing congressional debate over the future of the trade bank, which lends money to U.S. exporters and their foreign customers.

These anonymous sources are entitled to their opinions and ABS is certainly entitled to break off the deal. But, let’s assume it’s true. It’s not the federal government’s job to help Boeing get that contract. It would be one thing if the federal government were to reform the corporate-tax system and its myriad burdensome regulations, and thereby help Boeing get the deal. It’s a completely different story when one favored company, Boeing, is asking for help getting one specific deal at the expense of everyone else.

Second, Ex-Im subsidies were, according to ABS itself, not the reason they chose Boeing in the first place Dan Holler of the Heritage Foundation reminds us:

In 2012, ABS Chief Executive Thomas Choi told Space News that “Nobody else has this product.” He emphasized that “It’s just Boeing. If someone else had had it we would have considered other manufacturers.” This June he said “The procurement of ABS-8 shows our confidence and trust with Boeing on the all-electric propulsion 702SP platform technology.”

Boeing has its own financing arm and presumably could finance the deal. Sure, it would be easier if the feds would do it for them instead, but again, it isn’t necessary and it’s not right.

Alternatively, it should not be too hard for Boeing to find financing from a private lender: There’s a lot of liquidity out there and investors are chasing yield. The financing wouldn’t come at the cheaper rates offered by Ex-Im, but lack of cheap loans isn’t the same as lack of capital. If a deal can’t be financed through the capital market, it is generally a signal sent by capital markets, not a market failure. Not all deals should be financed, and it’s highly doubtful that the government does a good job of picking out the ones that the private market can’t find.

The liberal economist Dean Baker makes this point effectively in a slightly different context:

The other argument that should have been painful to economists was the claim that we make a profit on the Ex-Im Bank. This is true. The government is the lowest cost borrower in the country because no one questions its creditworthiness. This means the government can always profit by lending at interest rates that are between the market rate for its borrowers and its own borrowing rate.
No economist would argue that this “profit” means that such loans are good policy or carry no cost. It means that the government is effectively diverting capital away from some companies to go to the ones it has favored with below market interest rate loans. Invariably, these are huge companies like Boeing and General Electric, who always account for the vast majority of Ex-Im lending. This is only good policy if we think that the government is likely to do a better job than the market in allocating credit.

Exactly. The whole thing is here.