Congress hasn’t voted just yet on the Continuing Resolution that includes the Export-Import Bank’s reauthorization. But we already know that it will pass this week, and Ex-Im will get a new lease on life, probably through June. We’ll have this fight all over again next spring and summer. But the fight has already taught an important lesson: more agencies should have automatically expiring charters. Ending or reforming Ex-Im would never have been a possibility if its charter didn’t have an expiration date. I make that point in a piece in today’s Investor’s Business Daily:
Institutions matter. The rules of the game have a lot to do with how people play it — imagine what basketball strategy would look like if the three-point shot was changed to five points, or how baseball strategy would change if hitters could strike out on a foul ball.
The rules an agency issues aren’t the only ones that matter. Rules governing the agencies themselves are just as important. If more agencies had a built-in check such as an automatic sunset that forced a periodic congressional reauthorization vote, they would have an incentive to behave better and pursue their missions in a less burdensome way.
Without an expiring charter that Congress needs to reauthorize now and then, Ex-Im would have almost no chance of being reformed or closed. Now imagine if more agencies had their own sunsets or expiring charters, such as the EPA, the FCC, the Education Department, or any number of other agencies. Not only would reformers periodically have chances to rein in agency excesses or even abolish them outright, agency executives would know this. They would have a built-in incentive to self-police that is currently almost unknown in Washington.
If you want better results, often the game needs better rules. And that’s the biggest lesson from the Ex-Im fight. Read the whole piece here.