As I sit here, very close to the middle of the bustling state of Washington, the yields of crony capitalism flow all around me, and I am grateful. It’s the critics who call it crony capitalism. Others beg to differ, but the fundamentals are understood — it is international commerce, enabled by the federal government’s selective use of public credit. Whatever you call it, we in the most successful trading state in the nation benefit enormously. It allows our companies — small ones, and yes, the very big, profitable and influential ones — to compete in the world marketplace. When we make things in the United States and sell them overseas, money flows our way. That has to be good.
Accusing people of crony capitalism is the rage these days, and the target of the week is an otherwise obscure federal agency called the Export-Import Bank of the United States. It is a government bank, formed in the dark days of the 1930s, that makes and guarantees loans for U.S. goods sold overseas. The bank’s charter expires at the end of September, and unless reauthorized by Congress it will cease to make loans and fade from existence. In years past this vote was an automatic — there were critics, but they were overwhelmed. This year the political situation is much changed, and chances look good that the Export-Import Bank will be expunged. Conservatives and libertarians never liked the bank, as it uses public credit for private gain and snuggles too close to big international corporations. Surveying the coverage at the U.S. Capitol, this is the story: The former House Majority Leader Rep. Eric Cantor, R-Va., was the major broker of the last bank reauthorization, and just got himself trounced in a tea party primary revolt, accused of being a crony among capitalists. His leadership replacement, Rep. Kevin McCarthy, R-Calif., says he’s ready to let the bank die. House Financial Services Committee Chairman Rep. Jeb Hensarling, R-Texas, is an avowed bank foe. Speaker John Boehner is in the non-committal hand-washing stage, and it certainly doesn’t help that the Wall Street Journal reported this week that four Ex-Im Bank employees are under investigation for bribes and kickbacks. Influential conservative organizations, like the Heritage Foundation, and the editors at National Review, want the bank dead. Liberal commentators say they will do it, just because they can. The Ex-Im Bank is just “a scalp” to show off.