Nonsense at Club Mitt

Greg Mankiw spills the beans:

I just got back from Utah, where I was one of the speakers at a conference that has been dubbed "Club Mitt." One of the other speakers--this one a politician rather than a nerdy academic like me--spoke about the need to reauthorize the Export-Import Bank.  (I won't mention the person's name, since the event is off the record.)  What struck me is how weak the arguments were.

Three arguments for the Ex-Im Bank were given:

1. It creates jobs.  Of course it does!  If the government were to put the names of all businesses into a hat, pull out a few randomly, and give those a per unit subsidy, those businesses would expand and hire more workers. That would not make it a good policy, however, because the wrong jobs would be created.

2. It returns money to the Treasury.  Really?  If the bank were truly a profitable venture, we could privatize it.  I bet if the government tried to sell off the Ex-Im Bank, it wouldn't get much, if anything at all.  If the Bank's activity were actually profitable, we wouldn't need a government-run bank to do it.

Read the rest here.