And the special treatment foreign carriers receive from the Ex-Im Bank is just one element hurting domestic airlines. For instance, it was recently reported in The Street that, “Unlike state-owned Middle East airlines, U.S. airlines often face government-imposed obstacles. They carry an extremely high tax burden, while foreign competitors often operate largely tax-free. The U.S. plans a U.S. Customs preclearance facility in Abu Dhabi, even though no U.S. carriers fly to Abu Dhabi. And the Export-Import Bank often subsidizes the purchase of Boeing aircraft by foreign carriers, including both Emirates and Etihad, but no one subsidizes U.S. airline aircraft purchases from Airbus or Boeing.”
And while it is true that some American companies benefit from Ex-Im loans, the number that do is surprisingly small. In fact, one single company, Boeing, has been the chief beneficiary of Ex-Im’s largesse. Ironically enough, Boeing does not need the government’s handouts considering its stock price is near an all-time high. Moreover, the company nets more than $80 billion in revenue per year. While the American airline industry suffers, Boeing flourishes. The tradeoff is unfair and goes against the principles of free market capitalism with the U.S. government manipulating the marketplace against its very own employers.
Our government should not be interfering in the free market, especially at the expense of other American companies. The Ex-Im Bank was founded to help American companies, not hurt them. Yet, that is exactly what it is doing by financing foreign airlines. Not only does it put the American taxpayers hard-earned dollars at risk, it is financing the destruction of the American airline industry and threatening the jobs of its workers. Instead of spending money recklessly, the government should allow the free market to work.
American carriers aren’t looking for a hand out; only a balanced playing field. The last thing our country needs right now is the government subsidizing foreign airlines with taxpayer backed loans. But that, in fact, is exactly what they are doing. Congress should come together and work to bring an end to the Export-Import Bank once and for all.