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PARIS, THE NEW NORMAL? — Diana Johnstone files an in-depth report from Paris on the political reaction to the Charlie Hebdo shootings; The Treachery of the Black Political Class: Margaret Kimberley charts the rise and fall of the Congressional Black Caucus; The New Great Game: Pepe Escobar assays the game-changing new alliance between Russia and Turkey; Will the Frackers Go Bust? Joshua Frank reports on how the collapse of global oil prices might spell the end of the fracking frenzy in the Bakken Shale; The Future of the Giraffe: Ecologist Monica Bond reports from Tanzania on the frantic efforts to save one of the world’s most iconic species. Plus: Jeffrey St. Clair on Satire in the Service of Power; Chris Floyd on the Age of Terrorism and Absurdity; Mike Whitney on the Drop Dead Fed; John Wight on the rampant racism of Clint Eastwood’s “American Sniper;” John Walsh on Hillary Clinton and Lee Ballinger on the Gift of Anger.
The Elites and the Ex-Im Bank

The Corporate Welfare Bank of the United States

by DAVID S. D'AMATO

Over the past few weeks, the American business lobby and in particular the U.S. Chamber of Commerce have come out in force to support the reauthorization of the Export-Import Bank of the United States. These groups and their puppets in Washington insist that the Ex-Im Bank is good for American small businesses and supports job growth, that failing to reauthorize will harm the overall economy. Conscious of the political atmosphere, the Bank’s supporters have carefully avoided some ugly facts about this vehicle for corporatist cooperation.

The Ex-Im Bank epitomizes just the kind of unashamed corporate welfare that animates populist hostilities on both the American political right and left, the collusive cronyism that — whatever their rhetoric — establishment elites of both sides embrace with enthusiasm. The Democrat and Republican halves of the Washington political machine each have their own cynical uses for populist moods, but when the chips are down and the votes are cast American capitalism just is the active collaboration of powerful interests in big business and government. We have never had a free market in the United States, nothing even remotely close.

Agencies like the Ex-Im Bank redistribute wealth from ordinary taxpayers to the political chosen, mammoth corporations such as Boeing that couldn’t survive for a single day without constant, committed intervention from the American state. In 2010, nearly half of all Ex-Im Bank loans and loan guarantees went to that most favorite of aerospace giants, a year in which the company saw over $64 billion in revenue. So much for the oft-repeated propaganda about supporting small businesses. The Ex-Im Bank exists to ensure that the biggest companies, well-connected with lawmakers and regulators, never actually have to so much as think about competing in a hypothetical “free market system.”

Beyond Boeing, top clients of the cronyist Bank include General Electric, Caterpillar, and KBR, the notoriously corrupt former Halliburton subsidiary that has devoured hundreds of millions of dollars in government contracts. While it’s difficult to know exactly how much risk taxpayers are exposed to until, for example, a default actually occurs, the Congressional Budget Office recently poked holes in some of the Bank’s numbers. In a report this month (May 2014), the CBO said that under “fair-value” accounting — rather than the accounting method prescribed by the Federal Credit Reform Act — the Bank will cost taxpayers $2 billion over the next decade.

That’s just what we can see. We have no idea what free people making voluntary exchanges might do with those resources were they not tied up in the coercive, statist game of American capitalism. Advocates of individual rights and open competition, market anarchists distinguish between capitalism as it now exists, and has in fact always existed, and legitimate free markets.

Indeed, we use the term “freed markets” to signify that people have never yet been free from the tethers of state control within the economy. Real freed markets, without handouts to big business and incalculable other interventions, would distribute private property more widely and evenly, eroding the power and market share of the United States’ corporate titans.

The politically powerful devotedly serve the economically powerful — and the reverse is no less true. The Ex-Im Bank is just one of countless examples of big business courting the federal government, seeking and cultivating favorable public policy as a means of avoiding the discomfort of competition. In contrast, the kind of free competition that market anarchists favor is not at all antithetical to concerns about social and economic justice.

We see the goals of freedom and equality as mutually reinforcing. The imposition of the state against free people and their voluntary organizations is not protective but predatory, pitting people against each other in a fight to control the state. Agencies like the Ex-Im Bank are the illegitimate result of that ongoing fight. Perhaps it’s time to try this free market we keep hearing so much about.

David S. D’Amato is an attorney living and writing in Chicago. He holds a J.D. from New England School of Law and an LL.M. in Global Law and Technology from Suffolk University Law School. He maintains a website devoted to individualist anarchism at IndividualistAnarchist.com.