The Corner

To Drain the Swamp, Kill the Ex-Im Bank

President Trump’s campaign promise to “drain the swamp” in Washington set himself up for inevitable criticism, given that simplistic campaign-trail one-liners don’t hold up well when finally confronted by Beltway realities. But if the reports are true that Trump has decided to support the restoration of the crony Export-Import Bank’s full lending authority, it would be akin to the president deciding to instead happily bathe in the swamp and gargle the muck.

According to Politico, Trump told Democratic senators Joe Manchin (W.Va.) and Heidi Heitkamp (N.D.) that he basically changed his mind about the agency:

“Ex-Im Bank was big news, he wants to get that done. [Trump] said, ‘I’ve changed my mind completely on that. I’ve seen how it functions and what it can do and we can’t compete if we don’t have a functioning Ex-Im Bank,’” Manchin said, recounting Trump’s remarks. “Before, he thought it was different. So he’s changed and he’s 100 percent. He said, ‘you can tell everyone I said that.’”

Senator Heitkamp had her ​pro–Ex-Im talking points ready:

“It’s great news he agreed and said he would nominate someone to serve on the Ex-Im Bank Board very soon so the agency — which has been stalled for a year — can fully function and keep supporting American workers and small businesses, including many in North Dakota, just as it has done for more than 80 years,” Heitkamp said.

If true, the news is only “great” for Boeing, GE, and the other major recipients of Ex-Im’s corporate welfare. It is also at odds with his campaign promises since much of the way the program works is that it gives cheap loans — backed by Americans all over the country — to foreign companies in China, Russia, Saudi Arabia, and the UAE. Restoring Ex-Im’s full lending-authority powers is renewing the policy to give cheap loans backed by workers in the Rust Belt to companies like Ryanair ($4 billion in guarantee loans over ten years) and Emirates Airlines ($3.9 billion over ten years) so they can have a large competitive advantage over U.S. domestic airlines like Delta and United. It continued to subsidize the large and prosperous state-owned Mexican oil company PEMEX ($9.7 billion over ten years).

Seriously? That’s president Trump’s vision of draining the swamp? No, that’s the vision of the Democrats — who talk a good game but are the biggest corporatists when it comes to this stuff — and big-government Republicans.

It would also undo one of the only victories free-market lawmakers have had in Congress in their attempt to drain the swamp. It means that if the president follows through on what the Democrats say he said, it will put him at odds with many of those who are working with him. He may also face resistance from the new chairman of the Banking committee, Senator Crapo (R., Idaho), who may decide to do the right thing and follow in the courageous steps of former Chairman Richard Shelby (R., Ala.) who refused for months to move the President Obama’s nominee. After all, a majority of the majority in the Senate is against Ex-Im and there is no reason to see its full lending powers restored just because the Democrats want it. President Obama isn’t in power anymore.

Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.

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