As the debate over the Export-Import Bank's future continues (C4L supports allowing it to expire), Washington Examiner Senior Political Columnist (and LPAC 2014 speaker) Tim Carney debunks another of the doom-and-gloom pronouncements, writing:
The academic literature on this suggests that a large majority of exports that receive government-backed financing would happen anyway without the financing. This study found that Hermes, Germany's version of Ex-Im, financed "about 3 percent of exports" and that "trade creation due to Hermes therefore amounts to at most 0.52 percent of total German exports."
In other words, about 80 to 85 percent of Hermes-subsidized exports would have happened anyway. If this carries over to the U.S., then killing Ex-Im would reduce exports by about 0.333 percent. . . .
Further, a 0.33 percent reduction in U.S. exports wouldn't reduce the U.S. economy by 0.33 percent. . . .
Tags: corporate welfare, Eximbank