Here’s a letter to the Wall Street Journal:
Todd McCracken argues that export-loan subsidies doled out by the U.S. Export-Import Bank are justified, in part, because the private market consistently underestimates the profitability of unsubsidized export loans (“Should Congress Reauthorize the Export-Import Bank? ” Jan. 26).
Let’s get this argument straight. Hundreds of thousands of private investors across the globe – each with skin in the game and specialized exclusively in the task of spotting and seizing profitable investment opportunities – all mistakenly conclude that loans that Mr. McCracken asserts are worth the risk are, in fact, too risky. Therefore, according to Mr. McCracken, we are to trust the contrary judgments of government bureaucrats seated in Washington – each under pressure to appease special-interest groups, each spending only other people’s money, and none of whom is specialized exclusively in the task of spotting and seizing profitable investment opportunities.
Anyone who buys Mr. McCracken’s argument is the sort of person who eagerly emails his or her bank-account number to strangers claiming to be representatives of recently deceased Nigerian princes, and then awaits the promised receipt of millions of dollars.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030