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Seen and Unseen 101

Here’s a letter that I sent yesterday to the Wall Street Journal:

Fred Hochberg, President of the Export-Import Bank of the U.S., says proudly that “the mandate of the Export-Import Bank of the U.S. (Ex-Im Bank) is to help create and sustain U.S. jobs by financing U.S. exports” (Letters, August 21).  I’ve some questions – and answers – for Mr. Hochberg.

From where does the Ex-Im Bank get the dollars it spends to subsidize U.S. exports?  (Answer: taxpayers.)  Would taxpayers not spend or invest these dollars if these dollars were not taxed away?  (Answer: of course they would.)  Would not this spending and investing by less-onerously-taxed Americans not “help create and sustain U.S. jobs”?  (Answer: of course it would.)  Is there anything particularly desirable about a job producing and selling output for export as opposed to a job producing and selling output for domestic consumption?  (Answer: nope.)  Can you spend money more wisely than it can be spent by the taxpayers from whom it is confiscated?  (Answer: no; you almost surely spend it less wisely.)

So at best the Ex-Im Bank creates jobs in export industries by destroying jobs in non-export industries.  Final question, then: Why does the Ex-Im exist?

Donald J. Boudreaux

(Answer to the final question: to transfer wealth from unsuspecting taxpayers and consumers to politically powerful corporations; the Ex-Im Bank exists only to supply corporate welfare.)