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to sell us their goods is that they want our dollars to buy our debt, invest in the country, and buy our exports. That is why exports drop when overall imports drop.

Exports promote U.S. economic growth only if the value of the resources used to produce them is less than the value of what we receive as imports in exchange for those exports. By subsidizing American exports, EXIM causes too many resources to be devoted to producing exports. As a result, the total value of our exports is made larger than it would otherwise be to obtain any given amount of imports. In other words, EXIM thus compels American taxpayers to subsidize foreigners’ standards of living at no appreciable benefit to the US.

Unfortunately, this misunderstanding and the constant glamorization of exports and their impact on jobs and growth are used to justify government support for some exports (on average, 98 percent of exports are not backed by EXIM financing). It also is extremely unfair. Because capital will tend to shift from unsubsidized companies to subsidized companies (taxpayers foot the bill if companies backed by the Bank default), unsubsidized export companies face higher borrowing costs, which could translate into fewer jobs in unsubsidized companies or lower pay for their workers.

The Bank does not promote growth by leveling the playing field. EXIM’s charter stipulates that one of its missions is to support U.S. exports with the goal of creating jobs and promoting economic growth through the provision of export financing via its loan-guarantee and insurance programs. In particular, EXIM is to intervene in cases “where such support is necessary to level the competitive playing field for U.S. exporters due to financing provided by foreign governments to their exporters.”'®

As aresult, EXIM for years has been focused primarily on what other countries’ ECAs are doing and how much financing they are providing.” A reading of any of EXIM’s Competitiveness Reports shows that the Bank frames the “competitiveness” of the U.S. economy and exporters in extremely narrow terms—specifically, as the amount of business that foreign ECAs are doing relative to EXIM.

The report for 2020 features striking evidence of this mindset. For instance, lamenting the “nearly four-year hiatus” during which the Bank lacked a board quorum to approve large deals, EXIM’s leadership maintains that these years

“severely hindered EXIM’s ability to support the competitiveness of U.S. exporters.” During that time, foreign ECAs “fundamentally evolved their philosophy and substantively expanded their roles,” and “the United States must work hard to keep pace.” The Bank goes on to promise that it will “re-emerge from the years of being out of the long-term export finance business and restore its standing as one of the world’s most competitive ECAs.””°

In other words, EXIM bureaucrats appear to believe that economic growth and jobs result not from a favorable tax and regulatory environment, but froma victory in hand-to-hand subsidy combat between government banks. The Bank’s