A government agency dedicated to backing up bank loans, in an effort to boost one "crucial" sector of the U.S. economy? Why not? Especially because it has a great record, to date, of very few defaults. We promise, the taxpayers' money is not at risk.
Meet the Export-Import Bank of the United States, with many billions in outstanding guarantees and loans to foreign companies and foreign governments. Obama's Ex-Im chairman wants to do more financing. Bloomberg reports:
U.S. Export-Import Bank Chairman Fred Hochberg asked Congress for a 40 percent increase in the loan limit to $140 billion for fiscal year 2015 as borrowing by companies closed in on the current maximum....
Demand for bank support from companies such as General Electric Co. (GE), KBR Inc. (KBR), Caterpillar Inc. (CAT) and Boeing Co. (BA) surged after the financial system seized up in 2008 and banks tightened borrowing requirements. The lender is chartered by Congress and needs its authority to be renewed in order to operate beyond Sept. 30, when its five-year approval expires.
Senate Banking Committee Chairman Tim Johnson, a South Dakota Democrat, said he’s hopeful the reauthorization will be granted by September.
“I don’t see any controversy surrounding this issue, but you never know,” Johnson said in an interview.
Got that? Huge corporations say that banks are too skittish to finance their exports. So we need taxpayer-backed loans and guarantees.
What could go wrong?