Once again, the power of the small to medium-sized business is cited as the only reliable economic engine to pull the United States and the global economy out of a growing recession. And once again it is affirmed, albeit indirectly, that private sector industry, and not government policies (bailouts, subsidies, trade restrictions, complex regulations, special loopholes, and the like) holds the key to a balanced, survivable international economic future.
Simply put: How can we expect government, at any level, to create production or to assist in the generation of any type of budget-balancing or stabilization which requires genuine profitability? Ultimately governments are the antithesis of profitable enterprises -- they collect money, take a vast commission for themselves and spend it as they see "best" -- these politicos have never had to generate a profit in their entire careers. If they require something, they either raise taxes, raid special funds (rather like a chronic gambler who embezzles to cover his losses until his luck changes), or print currency.
The expense of government, aside from its lack of a profit/ survival requirement, is actually an increasing drain on some very overstressed economies. Creating more government jobs is certainly not the pathway to profit; it is merely interest added onto the nations exploding indebtedness, and placing an increasing percentage of the population into the not-for-profit sector. Business understands how to make a profit. Government plainly doesn't.
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For Immediate Release: Monday, June 25, 2012
Media Contact: Jamie Radice (Ex-Im Bank): 202-565-3200
Ex-Im Bank Chairman Says American Businesses Can Successfully Compete Against Foreign Companies, Not Countries
Releases 2012 Competitiveness Report, unveils study showing unregulated government financing exceeds all official export financing of the G-7 ECAs combined.
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Washington, D.C. – The chairman of the Export-Import Bank of the United States (Ex-Im Bank), Fred P. Hochberg, said today that American companies’ ability to win foreign sales is being challenged by a dramatic rise in official export credit financing. He made the remarks at the Center for American Progress.
Hochberg also outlined how the United States can become the world’s leading exporter again and how American businesses can compete globally amidst the rise of state-driven capital.
Following his speech, Hochberg released Ex-Im Bank’s 2012 Competitiveness Report. The Bank has produced these reports for Congress annually since 1972, and this year’s report examines the challenging trends in export finance driven by both OECD and non-OECD economies.
Excerpts from Hochberg’s speech, “A Wake-Up Call on American Competitiveness”
o “For the foreseeable future, our economic competitors will strongly support their companies, and industries that serve their national strategic interests. They will continue creating their own national champions. And how America responds to this will determine if we can create the millions of middle class jobs our nation needs today and in the years ahead.”
o “There are over 60 export credit agencies around the world, and each and every one is working to expand their footprint and increase their activity. This is the world we live in. And we've got to compete in the world as it is, not as we'd like it to be.”
o “American companies have what it takes to win in the global economy. They can go head-to-head with any company in the world. But they can’t go head-to-head with the government of another country. President Obama is right. We need a government that will fight for our economic interests around the world, to create more American jobs at home. There is no time to wait. It’s time to get to work.”
Key findings from Ex-Im Bank’s 2012 Competitiveness Report
o Against the backdrop of the European sovereign debt crisis and tight liquidity constraints, Ex-Im Bank has proven itself ready and able to step in with its long-term, fixed rate support for U.S. exports when the private sector had withdrawn from export finance.
o However, as the recovery continues and liquidity gradually returns to commercial markets, different competitive challenges are emerging.
o Most notably, significant volumes of unregulated OECD export credit programs (that fall outside the purview of the Organization for Economic Co-operation and Development “OECD” rules) and non-OECD export programs, such as those offered by Brazil, India, and, most prominently, China, are being deployed strategically around the globe, in favor of foreign exporters and national champions.
In fact, a conservative estimate shows that, collectively, these forms of government financing exceed all official export finance activity of the G-7 ECAs combined.
o Ex-Im Bank estimates that in 2011 there was roughly $100 billion in unregulated OECD export financing and an additional $60 billion from Brazil, India, and China.
About Ex-Im Bank:
Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. In the past five years, Ex-Im Bank has earned for U.S. taxpayers $1.9 billion above the cost of operations. The Bank provides a variety of financing mechanisms, including working capital guarantees, export-credit insurance and financing to help foreign buyers purchase U.S. goods and services.
Ex-Im Bank approved $32.7 billion in total authorizations in FY 2011 -- an all-time Ex-Im record. This total includes more than $6 billion directly supporting small-business export sales -- also an Ex-Im record. Ex-Im Bank's total authorizations are supporting an estimated $41 billion in U.S. export sales and approximately 290,000 American jobs in communities across the country. For more information, visit www.exim.gov.
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Middle management jobs are being automated. Traditional upward-bound career paths are no longer an applicable model. Monies are allocated to the least efficient, most irresponsible and avaricious "bailout failures" at the expense of the decreasing membership of the middle class, and the slightly increasing ranks of the working poor.
The UN has an ethical mandate and a fiduciary responsibility to foster small to medium-sized business growth through all of its agencies, alliances and institutions. An economy exists because of the needs of consumers -- if we ignore or trample them, there will no longer be anyone left with a single penny to buy anything with, and the basic nutritional, health and utilities functions will belong to an infinitely powerful class of neoplastic parasites who will keep robbing the people until a decent stand of living becomes unaffordable in a return to the vast poverty patches of the Dark Ages.
Small business and entrepreneurship are the engines which must be stoked in order to do what governments cannot do for themselves or for their respective citizen populations. Subsidizing non-productivity with the hard-earned funds of the productive masses is, for a time, unmitigated thievery -- after that civilization crumbles.
Everyone should support small to medium-sized businesses and the entrepreneurs who give birth to them. They are our deliverance from the ongoing and growing mismanagement of the public sector. Sadly, you will mostly find politicians there -- and they only know how to take and redistribute wealth that they cannot help to create.
Douglas E. Castle for The Internationalist Page Blog
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