Mercatus Center states-

Everywhere we look big business is teaming up with big government and that’s causing big problems. People know this and they’re sick of it. They’ve even taken to the streets. It’s a non-partisan outrage, from the tea party to Occupy Wall Street. People are sick of the cronyism, and the Export-Import Bank is the epitome of that cronyism.

Come September, lawmakers have a chance to put an end to this boondoggle. It should be a no-brainer for anyone who believes in markets and who see the immorality of giving subsidies to companies whether they are big or small and domestic-based or foreign-based. It should also be easy since most of the bank’s activities support large and successful companies which didn’t wait for the handout to make some cash. In fact, some great research by Heritage Foundation’s Diane Katz proves that the bank’s stories about being the secret ingredient in the success and profits sauce of specific small businesses—including the bank’s poster child Mrs. Jenny’s Pickles—are quite misleading.

But what about the claim that export subsidies are necessary to counteract the competitive disadvantages posed by the export credit agencies of foreign nations? As the argument goes since foreign firms enjoy the benefits of their own national export subsidy organizations, the thinking goes, U.S. firms would struggle to compete internationally if our federal government did not provide similar aid.

Obviously, U.S. exporters prefer that their companies only had to compete on price and quality against unsubsidized foreign companies. Bad economic policy is hardly limited to the U.S., and many countries have indeed established their own export-financing agencies just like the Export-Import Bank. This does not justify the bank’s existence, however.

Congress recently obliged the bank to provide more explanations for certain portfolio transactions as a condition of its most recent reauthorization in 2012. While the bank does not provide justifications for all transactions in its portfolio, the bank’s current charter now compels Ex-Im to at least provide categorical explanations for all loans and long-term loan guarantees in its annual report.

According to the Export-Import Bank’s fiscal year 2013 annual report, roughly $7.9 billion in estimated export-valued loans and $10.7 billion in estimated export-valued long-term loan guarantees, or a combined estimated export value of $18.7 billion, must be categorized as Congress legislated.

Here is how Ex-Im justifies its activities: $4.1 billion in estimated export value is justified because of “political risks,” another $2.1 billion in estimated export value is justified because of “private sector limitations,” and finally $12.2 billion in estimated export value is justified because of “foreign competition.” That leaves $18.8 billion in estimated export value, or 50.2 percent, of the rest of the bank’s portfolio unjustified.

Since the estimated export value of the bank’s entire portfolio for fiscal year 2013 was roughly $37.4 billion, this means that less than one third of the estimated export value of the bank’s portfolio is intended to actually counteract competitive disadvantages wrought by foreign export credit agencies.

What’s more, much of this financing goes to large corporations that are unlikely to be incontrovertibly harmed by foreign export credit agencies. For instance, roughly 66 percent of the value designated to “meet competition from a foreign, officially-sponsored export-credit agency” went to the Boeing Corporation, whose own financial director publicly admitted could “find alternative funding sources” without the Export-Import Bank.

The bottom line is that defending the Export-Import Bank on the grounds that it effectively counters foreign competition simply does not hold water. The Export-Import Bank backs less than 2 percent of the value of total U.S. exports. It means that more than 98 percent of U.S. exports take place without any support from the Ex-Im Bank. In addition, the Bank’s data show that it justifies less than 33 percent of this tiny portion on the grounds of countering foreign competition. In other words, the Bank claims to counteract 0.0066 percent of the value of U.S. exports that are exposed to foreign-subsidized competition.

The Bank’s effect in countering foreign subsidies is negligible, but its activities come at the great costs of corporate cronyism, economic distortions and irresponsible taxpayer exposure. It’s time to retire the Export-Import Bank.