The charter for OPIC expired but it still has an IV in its vein, much like the Export-Import Bank does at this moment. But lawmakers need to pull the plug. Flatline style.
In a 2003 study, the Cato Institute’s Ian Vasquez and John Welborn found that OPIC’s top ten beneficiaries accounted for 87 percent of OPIC’s business in 2002. This was not an aberration.
In 2014, journalist Timothy P. Carney discovered such OPIC financing projects as $250 million for Sun Edison to build a solar farm in South Africa, and $150 million in insurance to subsidize new Citibank branches in politically risky countries such as Pakistan, Jordan, and Eqypt, while asking an important question: “Citibank is America’s third-largest bank, with total assets of $1.8 trillion, yet it can’t line up insurance without taxpayer backing?”
Veronique de Rugy of the Mercatus Center at George Mason University calls OPIC, along with the Export-Import Bank, “the poster children for programs that privilege big lenders,” noting that, “both programs extend loan guarantees allowing lenders—including many large banks such as JP Morgan, Citibank or Wells Fargo—to transfer most of the risk of doing business to U.S. taxpayers while cashing in large fees and interest payments (albeit at lower rates than commercial loans) from the borrowers.”
Other OPIC beneficiaries over the years have included large companies such as General Electric, Bank of America, Intergen, which is a joint venture of oil company Shell and engineering and construction firm Bechtel, Ritz-Carlton and Hyatt Hotels—and even the now-defunct Enron.