In the Wall Street Journal today, Mark Pfeifle, a former deputy national-security adviser, highlights the Export-Import Bank’s corruption and number of questionable recipients. The problems lead him to conclude that the program works against our national-security interests, not for them as Ex-Im backers like to contend.
For decades, Ex-Im has sent American taxpayer money to companies and countries that either have no place doing business with America or actively undermine U.S. national security interests.
The most egregious example: Ex-Im has given hundreds of millions of dollars in taxpayer-backed guarantees to the state-owned Russian bank Vnesheconombank (VEB). Ex-Im only recently suspended new deals after the bank was targeted by American sanctions in the past year.
VEB has a long and sordid history. Known until 2007 as the Bank for Foreign Economic Affairs of the U.S.S.R., VEB maintains an operating agreement with Russian arms exporter Rosoboronexport “to promote exports of Russian military products and boost their competitive edge in the world market.” Rosoboronexport also handles more than 80% of Russia’s weapon exports. In this capacity, it has become a chief weapons supplier to Bashar Assad’s regime in Syria and has supplied advanced missile systems to Iran, according to reporting last year in this newspaper. VEB has said that its practices fully comply with European Union and United Nations sanctions.
Americans probably assume that Washington wouldn’t use taxpayer money to help a company that supports these regimes. Yet the bank’s records indicate that VEB received a $497 million loan guarantee in 2012 and a further $703 million in 2014. American taxpayers still haven’t received thank-you cards from President Assad and the mullahs.Ex-Im has nearly $1.5 billion of taxpayer exposure in Russia by the bank’s own report. And its indiscriminate use of taxpayer money extends far beyond Vladimir Putin’s autocracy. Between 1997 and 2014, companies in countries such as China, Venezuela, Pakistan and others received billions of dollars in Ex-Im’s taxpayer-backed assistance.
Many of the bank’s foreign beneficiaries are also state-owned. American taxpayers are unwittingly propping up the bank accounts of foreign states, from China to Russia to a host of other countries. Thus it should also come as no surprise that the bank has a long history of assisting international firms that raise serious red flags.
Adding in the fact that there are many thousands of Ex-Im transactions that we know nothing or very little about, you can understand his conclusion:
This points to a simple conclusion. Despite the fanciful claims by Secretary Albright, Secretary Cohen and the officials who signed the recent letter, the Export-Import Bank is anything but a “critical element” of America’s national security. Congress should refuse to reauthorize the bank when its charter expires. Washington shouldn’t be spending taxpayer money on corporate welfare—especially when it goes to companies and countries that are either corrupt or are actively working to undermine America.
The whole thing is here.