Acting without any legal authority, President Obama has overridden the federal charter of the Export-Import Bank, and turned it into a competitor for domestic loan business, in utter defiance of the law.
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Well, if there's one thing we've learned from watching the Obama Administration in action for three years, if there's anything they despise, it's pesky laundry lists of rules that limit executive desires.
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He has announced that he will break with 80 years of history and a clear bank charter to direct the Ex-Im Bank to provide loans for domestic (USA-to-USA) sales if a foreign government might offer export financing to the manufacturer's foreign competitors. They all do! By definition, export financing agencies abroad provide this service on their international sales; it's not normally restricted by industry or product.
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This isn't the first time that this president has attempted to politicize the Ex-Im Bank and meddle with its rules. The administration quietly issued an edict in 2009 that the Ex-Im Bank was to give greater support to green projects, and to deny outright projects that involve fossil fuels, no matter how deserving the project or how compliant with the bank's charter.
This exploded into a political debacle in the run-up to the 2010 election, when ex-Senator-to-be Russ Feingold of Wisconsin had to intervene and plead with the administration to remove the political hold intended to kill a $600 million sale for suburban Milwaukee's Bucyrus International. The resulting embarrassment -- discovering that the Democratic Party would rather kill thousands of American union jobs than participate in a coal mine project in India -- likely contributed to the November victory of now-Senator Ron Johnson.
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This 2012 initiative is different. This 2012 initiative turns the concept of export finance on its head. It directly orders a bank to disregard its ban on domestic loans, and sell domestically. The initiative orders the Ex-Im Bank to disregard its requirement to loan only on export shipments, and instead to loan operating cash to put companies in a better position to export (a goal with no substance whatever). It orders them to break their cardinal rule against competing with private domestic banks. And by definition, it likely means that these expanded offerings will crowd out the very kind of loans -- to foreign purchasers of American export goods - that the Ex-Im Bank was created to provide.
This administration is making a habit of directing government agencies to change their very jobs without congressional authority. The military isn't there to fight wars, but perhaps to help with disaster assistance. The Department of Education is to issue guidelines on children's diets. NASA is to stop flying into outer space, and instead is to propagandize about the scientific contributions of Islam through the ages. The Department of Energy is to thwart energy independence by denying permits that would produce domestic energy.
And now the Export-Import Bank is to loan money to domestic customers engaging in domestic transactions.
This administration is abusing government, by using agencies for purposes other than their constitutional or statutory functions. This government by executive fiat grows ever more random, ever more disconnected from the reality of the legislation that chartered these departments and agencies as they wander ever farther afield.
