The U.S. Export-Import (ExIm) Bank has faced a fair amount of criticism in recent years, much of it from conservatives – such as Senator Mike Lee, who calls ExIm an example of “crony capitalism,” and has tried to abolish it. It’s safe to say that Sen. Lee – who also denies the reality of human contributions to climate change – wasn’t primarily concerned with ExIm’s funding of climate-destroying projects.
But that’s why several environmental groups sued ExIm for providing loan guarantees to support coal exports from Xcoal Energy, alleging that ExIm had failed to consider the impacts of its actions on the climate and other environmental impacts.
A federal court in the District of Columbia recently dismissed the suit, finding that the enviro groups didn’t have “standing.” This is a complex legal doctrine, but what it boiled down to in this case was that ExIm managed to convince the judge that Xcoal didn’t actually need its loan guarantees, which allow a company easier access to financing by guaranteeing loans from private banks. So, the court found, ExIm’s actions didn’t actually have any effect on the amount of coal produced, exported, and burned.
In other word’s, ExIm’s loan guarantees are completely unnecessary to support Xcoal’s coal exports.
So that begs the question – why not just cancel them? Subsidizing coal exports is bad policy anyway, but when ExIm and Xcoal agree that the company doesn’t need ExIm’s help, why on earth is it doing this?
ExIm has also faced strong criticism from the left; Ralph Nader has also called for its abolition. In 2008 a progressive senator called ExIm “little more than a fund for corporate welfare.” He’s no longer in the Senate, though – he’s in the White House now.