Democrats don’t like it when rich Americans get tax breaks, but they’ll fight tooth and nail for U.S. subsidies to Iran’s state-owned airline.
Democrats’ rhetoric said Big Business is bad, but Democrats’ voting record says subsidies for Boeing, General Electric and J.P. Morgan are crucial.
If anyone ever believed a syllable of the populist rhetoric that flows forth from the mouth of President Obama, Minority Leader Nancy Pelosi, or any congressional Democrat, the party’s relentless, reckless — and now nearly successful — drive to revive the liquidating Export-Import Bank should crush that myth.
The Export-Import Bank is a federal agency that, up until its charter expired four months ago, subsidized U.S. exports through taxpayer-backed loans and guarantees. About 40 percent of Ex-Im’s financing was for one purpose: To subsidize Boeing sales. General Electric, Westinghouse, and other corporate giants also took huge slices of Ex-Im’s subsidy pie. The top 10 users of Ex-Im accounted for about two thirds of the agency’s subsidies.
Ex-Im was also corporate welfare for Wall Street. In a typical deal, the foreign buyer got a commercial loan from the likes of J.P. Morgan, and the U.S. taxpayer, through Ex-Im, would bail out the private bank if anything went wrong. “There’s nothing that a commercial bank loves more than guaranteed financing,” Citigroup executive director Michael Eckhart said at a recent Ex-Im annual conference. “That’s a good thing!”
This is what Obama ran against in 2008 when he decried policies that prescribed: “give more and more to [those with] the most, and somehow prosperity will trickle down.” Back then Obama called Ex-Im “little more than a slush fund for corporate welfare.” When Obama took office, Boeing’s share of Ex-Im subsidies rose, and the agency undertook an initiative to subsidize at least $1 billion in private jet sales.
Obama hasn’t passively supported Ex-Im — he’s fought tooth and nail to save it. Last year, Obama dedicated a weekly radio address to Ex-Im. He named Boeing CEO Gerry McNerney head of his export council, and personally addressed the Ex-Im annual conference. Obama, earlier this year, threatened to veto a highway bill if it didn’t include an unrelated rider reviving Ex-Im.
Obama is All In for Ex-Im. So is his party.
While about half of congressional Republicans support the subsidy agency, nearly all Democrats do. In order to overcome the opposition of the House majority leader, speaker-elect, the House Financial Services Committee chairman, and most Republicans on the committee, Democrats got behind a Discharge Petition that eventually moved Ex-Im reauthorization to the floor.
More than 150 Democrats signed the petition, to the cheers of K Street lobbyists and the U.S. Chamber of Commerce. Many of them did so almost in the same breath that they excoriated Republicans for being too chummy with corporate America.
Cathy Castor, a Florida Democrat, walked straight from signing the pro-Ex-Im petition to railing against “an irresponsible giveaway to Big Oil.” The “giveaway” was a bill allowing the export of oil. But Castor was fine with subsidizing other exports, including billions of oil and gas industry exports. Pemex, Mexico’s state-founded oil company, is Ex-Im’s biggest single recipient.
Democrat Bobby Rush, seconds after accusing Republicans of “a multibillion-dollar boondoggle for the energy industry,” walked to the well of the House and signed the Ex-Im petition. On its website, Ex-Im brags, “From fiscal 2001 to the present, Ex-Im Bank has provided commitments totaling $14.8 billion dollars for 78 transactions/projects in the Petroleum Sector.”
This is the norm: Democrats attack Republicans as shills for big business, then Democrats go out and approve billions in corporate welfare while raking in the lobbyist cash. Obama has been a leader in this sort of populist posturing and corporatist governing. Hillary Clinton promises to up the game.
In the House, every Democrat but one voted to revive Ex-Im. The party also stood firm Wednesday in blocking amendments to reform Ex-Im.
One amendment would have barred Ex-Im subsidies to state sponsors of terrorism. Industry lobbyists opposed this measure (Iran Air wants to buy Boeing, and it wants the U.S. taxpayer to bear the risk). The amendment lost, as Democrats voted 181 to 4 against it.
Ex-Im dedicates twice as much financing to Boeing sales as it does to the exports by every small business in America combined. Still, Democratic rhetoric on Ex-Im is roughly 90 percent about small business. One amendment on Wednesday would have required the agency to increase its small business portion to 40 percent — equal to Boeing’s current share. Lobbyists said No Way and every single Democrat voted Nay.
Republicans are plenty guilty of corporate welfare, contrary to their free-enterprise rhetoric. But in this case, all the opposition to Ex-Im came from Republicans (plus Sen. Bernie Sanders). If even nine Senate Democrats opposed Ex-Im (31 Senate Republicans do), the agency might be kept dead.
But Democrats’ opposition to Big Business seems to end once Big Business comes asking for Big Government.
Timothy P. Carney, The Washington Examiner’s senior political columnist, can be contacted at [email protected]. His column appears Tuesday and Thursday nights on washingtonexaminer.com.
