The Export-Import Bank

This country has a $6 trillion national debt, a growing deficit, and is borrowing money from the Social Security Trust Fund in order to fund government services. We can no longer afford to provide over $125 billion every year in corporate welfare—tax breaks, subsidies, and other wasteful spending—that goes to some of the largest, most profitable corporations in America. 

One of the most egregious forms of corporate welfare can be found at a little known federal agency called the Export-Import Bank, an institution that has a budget of about $1 billion a year and the capability of putting at risk some $15.5 billion in loan guarantees annually. Over 80 percent of the subsidies distributed by the Export-Import Bank goes to Fortune 500 corporations. Among the companies that receive taxpayer support from the Ex-Im are Enron, Boeing, Halliburton, Mobil Oil, IBM, General Electric, AT&T, Motorola, Lucent Technologies, FedEx, General Motors, Raytheon, and United Technologies. 

Many of these same companies pay exorbitant salaries and benefits to their CEOs. IBM, for example, gave their former CEO, Lou Gerstner, over $260 million in stock options while they were lining up for their Ex-Im handouts. 

The great irony of Ex-Im policy is that in the name of “job creation” a substantial amount of federal funding goes to corporations that are eliminating hundreds of thousands of American jobs. American workers are providing funding to companies that are shutting down the plants in which they work and are moving them to China, Mexico, Vietnam, and wherever else they can find cheap labor. 

For example, General Electric has received over $2.5 billion in direct loans and loan guarantees from the Ex-Im Bank. What was the result? From 1975-1995 GE reduced its workforce from 667,000 to 398,000, a decline of 269,000 jobs. While taking the Ex-Im Bank subsidies, GE was extremely public about its “globalization” plans to lay off American workers and move jobs to third world countries. Jack Welch, the longtime CEO of GE stated, “Ideally, you’d have every plant you own on a barge.” 

General Motors has received over $500 million in direct loans and loan guarantees from the Export-Import Bank. The result? GM has shrunk its U.S. workforce from 559,000 to 314,000. 

Motorola has received almost $500 million in direct loans and loan subsidies from the Ex-Im Bank. Only 56 percent of its workforce is now located in the United States. 

According to Time Magazine, the top 5 recipients of Ex-Im subsidies over the past decade have reduced their workforce by 38 percent—more than a third of a million jobs down the drain. These same 5 companies have received more than 60 percent of all Export-Import Bank subsidies. Boeing, the leading Ex-Im recipient, has reduced its workforce by more than 100,000 employees over the past 10 years.