Conservatives deride using government to help American companies export their goods as “picking winners and losers,” even when the winners are American exporters and workers.
So Republicans have closed the Export-Import (Ex-Im) Bank, hopefully temporarily. The Ex-Im Bank provides financing guarantees to customers of American exporters if they cannot obtain financing elsewhere. This helps American companies make the sale.
Since congressional Republicans allowed the bank’s authority to expire earlier this month, credit insurance that customers of U.S. exporters had depended on for a purchase is not coming through. Bids have to be cancelled or rewritten. Somewhere around 3,000 smaller U.S. exporters who relied on the bank are feeling the heat. Larger companies like Boeing and Caterpillar are also feeling the heat, of course, but at least they have resources to handle it, for now. However, if the bank’s charter is not renewed even they will have to take steps, and those steps will hurt our job situation and our economy.
And get this: Of course competitors from other countries are moving in to take that business instead.
A story in Politico,” Businesses fume as Congress lets Export-Import Bank stay dead,” describes the situation these exporters are in:
A small crop-duster manufacturer and a Texas company that exports oil equipment fret about losing 25 percent to 40 percent of their sales. The president of a trade-financing firm says many of his 1,000 clients could see their Christmas season business plummet.
Majority Supports Ex-Im
The thing to know about the Ex-Im Bank fight is that the Senate has voted to renew its charter, and a majority of the House would as well if a vote were allowed. House Democratic Whip Steny H. Hoyer said on the floor recently, “There are 240-plus, maybe 250, maybe 260, maybe 270 votes. You only need 218 to pass the Export-Import Bank on this Floor.”
But the game is rigged. The Koch brothers and their money are behind a campaign to kill the bank, so that’s that. House Republican leadership won’t allow a vote, because it would pass.
This is a fight inside the Republican Party. The “business” side of the party wants the Ex-Im Bank; the more libertarian Koch-funded side does what the Kochs tell it to do. The Hill, in “Ex-Im supporters worry after defeat,” writes:
“Conservatives delivered a historic policy victory,” Heritage Action for America spokesman Dan Holler said.
… The U.S. Chamber of Commerce and National Association of Manufacturers (NAM) are lobbying to revive the bank, arguing that its international financing helps to sustain thousands of U.S. jobs.
“It’s time to allow a bipartisan majority of Congress to reauthorize a tool that we need to enhance America’s free enterprise system against aggressive foreign competitors and level the playing field for manufacturers to win business for more U.S. jobs,” NAM president and CEO Jay Timmons said in a statement.
Boeing and GE are threatening to move “key pieces” of their manufacturing out of the U.S. Take this one with a grain of salt, though. Boeing especially is known for making threats like these to try to gain concessions from unions. On the other hand, “About 40 percent of the agency’s credit portfolio consists of loans and loan guarantees associated with the overseas sales of Boeing jetliners.”
A Reuters report, “Boeing may move work abroad with Ex-Im future uncertain: chairman,” quotes Boeing’s Co-Chairman Jim McNerney, saying:
“We are now forced to think about this differently,” McNerney told hundreds of executives and diplomats during an interview hosted by the Economic Club of Washington.
McNerney, who retired as the company’s chief executive on July 1, said Boeing might consider sites in countries that offer export credits, but gave no details about which operations could be affected or when the company had launched its review.
But GE CEO Jeff Immelt says the same:
GE’s chief executive, Jeff Immelt, last month told the Economic Club his company would move manufacturing jobs to Canada and Europe if the Ex-Im bank closed.
The House has a chance to reopen the Ex-Im Bank when it returns from its summer recess. Ex-Im reauthorization was contained in the Senate’s six-year transportation bill that passed on Thursday and is now waiting for the House leadership to allow a vote.
Conservatives are using this Ex-Im Bank issue to look like populist champions fighting against “corporate welfare” on behalf of the taxpayer. Heh. Don’t believe it. This is part of a bigger attack against the idea of using government to make the lives of working people better. The Ex-Im Bank supports jobs that might not exist without government help. Killing the Ex-Im Bank is unilateral disarmament when other countries are doing far more than the U.S. to support their exporters. Workers and business owners need to stand up against this attack on the Ex-Im Bank and on our country’s ability to compete in world markets.