This helps to explain why, on Feb. 16, President Barack Obama went to Boeing's widebody jet plant in Everett, Wash., to campaign for re-election, and to announce a plan to strengthen the Export-Import Bank -- just two months after the airline industry sued the bank. It is one more sign that our country, including our president, suffers from anti-airline hysteria.
|President Barack Obama speaks Feb. 16 at Boeing's widebody jet plant in Everett, Wash.|
The supposed role of the Ex-Im Bank is to finance foreign purchases of U.S. goods for customers who couldn't otherwise afford it. Because Boeing is the largest U.S. exporter, the bank's principal function is to finance purchases of Boeing aircraft. But the buyers, in many cases, are wealthy foreign airlines who use the aircraft to compete against U.S. airlines.
Among the countries whose airlines have been helped by the bank's loans are Canada, Japan, New Zealand, Singapore and the United Arab Emirates - not exactly poor countries with disadvantaged airlines.In November, Airlines 4 America, an airline trade industry group, sued to prevent bank financing of a Boeing deal with Air India. A4A said such loans need to follow legal guidelines that include consideration of the impact on U.S. jobs, in particular airline jobs. "It's absurdly unfair to U.S. carriers that the U.S. government should be financing our foreign competitors with below-market interest rates," said Ben Hirst, senior vice president and general counsel for Delta (DAL), in a 2010 interview. "It creates an unlevel playing field for U.S. airlines competing internationally, and it has led to [high] capacity levels in international markets that have been encouraged to develop regardless of market conditions." Does Obama care that airlines are suing the Ex-Im Bank? His companion on the trip to Everett, according to The Seattle Times, was Fred Hochberg, the bank's chairman. The chairman of his export advisory council is Boeing CEO Jim McNerney. He is seeking to increase the Ex-Im Bank's funding level to $140 billion from $100 billion. In Everett, the president also seemed to throw a bone to the airline industry, saying he would back financing for some domestic sales which, according to the newspaper, would include jets sold in competition with Canada-based Bombardier, if Canada pursues its intention to offer financing.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV