H. Contractor and P. Reimherr report that over the past 5 years, the Tea Party faction of Congress and the Administration have repeatedly clashed over, just about everything. Obamacare, foreign policy, the size of the government political observers would be hard pressed to find area in which the President and the Tea Partiers can actually find some ground. But the Tea Party latest target the Ex-Im Bank signals a new and vastly more troubling chapter in this fight, one that should bother anyone who cares about economic growth in a time where the recovery is finally taking hold.
The Ex-Im Bank is our official export credit agency. It helps American companies acquire financing when necessary and makes loans to foreign customers of American made products. It supports the work of large companies like Boeing and GE and the many small businesses that make up the supply chain for those corporations.
The Ex-Im Bank is not an instrument unique to the United States. Almost 60 nations have similar export credit agencies. If Congress fails to reauthorize the Ex-Im Bank, the U.S. would be the only major economy without an export credit agency.
Other countries have established these banks because they see the value they bring to their local economies. The U.S. Ex-Im Bank supported $27.5 billion worth of U.S. exports in 2014 alone. And during the recession, when many companies did not have access to liquidity, the Ex-Im Bank stepped in to provide much-needed support.
The fight over the Ex-Im Bank marks a new radicalism in Washington, an instance in which, unsatisfied with manufactured crises and government shutdowns, Tea Party Republicans are looking to take a hatchet to smarter investments we make in our country. But this time it is actually worse because of the need for reauthorization, all the Tea Party has to do is play the waiting game, the consequences of which could be disastrous for our country. This loss would limit nuclear expansion in the U.S.
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