GOP-led Congress prepared to let Export-Import Bank expire

WASHINGTON — Congressional Republicans are poised to deal a sharp blow to their traditional allies in the business community by allowing the federal Export-Import Bank to go out of business at the end of the month. But it may only be temporary.

The 81-year-old bank is a little-known federal agency created during the Depression that makes and guarantees loans to help overseas buyers purchase U.S. products, from airplanes to bridges to baby clothes. Over the past year it’s also become a surprising test of GOP purity, as tea party-backed lawmakers and outside conservative groups have denounced the bank as crony capitalism and vowed to get rid of it, pressuring fellow Republicans to go along.

“It is the purest form of corporate welfare, where you have a government agency that basically exists to subsidize Boeing airplanes and GE engines and Caterpillar tractors,” said Dan Holler of Heritage Action for America, one of the conservative groups pushing congressional Republicans to stand against the bank.

Supporters at the Chamber of Commerce and other business groups disagree, arguing that the agency helps many smaller companies and is necessary to keep U.S. businesses competitive, especially because key foreign competitors like China have generous export credit agencies helping their homegrown industries.

“The fact that all the major exporting countries have export credit agencies means American exporters would be competitively disadvantaged if the bank goes away,” said Boeing spokesman Tim Neale. “The opposition has thrown a lot of stuff out there that’s frankly pretty misleading.”

The Export-Import Bank, which says it supported $27 billion in U.S. exports last year, still counts supporters in both parties on Capitol Hill. But a number of high-profile Republicans including Senate Majority Leader Mitch McConnell, R-Ky., and House Majority Leader Kevin McCarthy, R-Calif., have abandoned past support for the bank under pressure from the party’s conservative wing. Most of the party’s leading presidential candidates have also lined up against reauthorizing the bank.

“The Export-Import Bank is essentially welfare for big corporations, both foreign and domestic,” Texas Sen. Ted Cruz, one of the GOP hopefuls, said in a Wednesday speech at the Heritage Foundation. “Do nothing, let it expire, and end the gravy train for Washington lobbyists on the Export-Import Bank.”

Republican House Speaker John Boehner of Ohio, a longtime business booster, has pushed his Financial Services Committee Chairman Jeb Hensarling, R-Texas, to come up with a plan to reform the bank or wind it down. Hensarling has responded, instead, by pushing for the bank’s charter to expire without a vote June 30.

With Congress heading out on recess next week and no prospect of action on the Export-Import Bank before then, Hensarling and fellow tea party conservatives will get their wish. But their victory may be short-lived.

Lawmakers of both parties on Capitol Hill expect a reauthorization of the bank could move in the Senate in July. If attached to must-pass legislation extending the federal highway trust fund, it could make it through the House as well.

The fate of the Export-Import Bank has become enmeshed in Congress’ contentious debate over trade after Washington Democratic Sen. Maria Cantwell withheld her support on a key trade vote last month until she said she got a commitment from McConnell to allow a vote on the bank.

What exactly was agreed to is now a matter of dispute on Capitol Hill, and McConnell says he’s already fulfilled his commitment by allowing a symbolic vote on the Export-Import Bank earlier this month that allowed supporters to demonstrate they command at least 65 votes in favor. Still, McConnell and other GOP leaders sound open to adding a reauthorization of the bank to the highway bill next month.

“The highway bill, of course, will be open for amendment, and it’s pretty obvious that that would be a place for this vote to occur,” McConnell said Tuesday.

Asked about the issue Wednesday, Boehner said: “I think some expectation has been that it’ll come over here on some must-pass bill. The only commitment I’ve made is that if it does, it would be considered under an open process.”

Some supporters seem resigned to a brief lapse in the bank’s charter. But some Democrats say even a temporary standstill will jeopardize projects and U.S. jobs. They also question whether Congress has abandoned its habit of solving problems only when a deadline looms — in favor of solving them only after the deadline has come and gone.

“There’s a whole lot of people who think that it doesn’t matter; it does matter. It matters to the jobs that are out there. We have $11 billion in credit in the pipeline at the Ex-Im Bank. That $11 billion is now going to be stalled out,” said Sen. Heidi Heitkamp, D-N.D. “I hope that the message this place gets is do things on time, don’t wait.”

Talk to us

More in Herald Business Journal

FILE - In this Monday, March 23, 2020, file photo, a worker walks near a mural of a Boeing 777 airplane at the company's manufacturing facility in Everett, Wash., north of Seattle. Beginning in 2024, some 737 planes will be built in Everett, the company announced to workers on Monday. (AP Photo/Ted S. Warren, File)
With 747 out, Boeing to open new 737 Max line at Everett’s Paine Field

Since the last 747 rolled out of the factory, speculation has been rife that Boeing might move some 737 Max production to Everett.

IonQ will open a new quantum computing manufacturing and research center at 3755 Monte Villa Parkway in Bothell. (Photo courtesy of IonQ)
Quantum computing firm IonQ to open Bothell R&D center

IonQ says quantum computing systems are key to addressing climate change, energy and transportation.

Nathanael Engen, founder of Black Forest Mushrooms, sits in the lobby of Think Tank Cowork with his 9-year-old dog, Bruce Wayne, on Friday, Jan. 27, 2023, in downtown Everett, Washington. (Ryan Berry / The Herald)
Growing green mushrooms in downtown Everett

The founder of Black Forest Mushrooms plans to grow gourmet mushrooms locally, reducing their carbon footprint.

Barb Lamoureux, 78, poses for a photo at her office at 1904 Wetmore Ave in Everett, Washington on Monday, Jan. 23, 2023. Lamoureux, who founded Lamoureux Real Estate in 2004, is retiring after 33 years. (Annie Barker / The Herald)
Barb Lamoureux, ‘North Everett’s Real Estate Agent’ retires

A longtime supporter of Housing Hope, Lamoureux helped launch the Windermere Foundation Golf Tournament.

Bothell
AGC Biologics in Bothell to produce new diabetes treatment

The contract drug manufacturer paired with drug developer Provention Bio to bring the new therapy to market.

FILE - In this file photo dated Monday, March 11, 2019, rescuers work at the scene of an Ethiopian Airlines plane crash south of Addis Ababa, Ethiopia.  The number of deaths in major air crashes around the globe fell by more than half in 2019 according to a report released Wednesday Jan. 1, 2020, by the aviation consultancy To70, revealing the worst crash for the year was an Ethiopian Airlines Boeing 737 MAX on March 10 that lost 157 lives. (AP Photo/Mulugeta Ayene, FILE)
US board says Boeing Max likely hit a bird before 2019 crash

U.S. accident investigators disagree with Ethiopian authorities over the cause of a 2019 Boeing 737 Max crash.

Store owner Jay Behar, 50, left, and store manager Dan Boston, 60, right, work to help unload a truck of recliners at Behar's Furniture on Monday, Jan. 16, 2023. Behar's Furniture on Broadway in Everett is closing up shop after 60 years in business. The family-owned furniture store opened in 1963, when mid-century model styles were all the rage. Second-generation owner, Jay Behar says it's time to move on. (Annie Barker / The Herald)
Behar’s Furniture in Everett closing after 60 years

“It’s time to move on.” The small family-owned store opened in 1963 and grew to cover an entire city block.

Katy Woods, a Licensed Coach, Branch Manager, and experienced Banker at Coastal Community Bank.
Coastal Community Bank Offers Classes for Businesses

To support local business owners and their teams, Coastal offers complimentary Money… Continue reading

Innovative Salon Products online fulfillment employees, from left, Stephanie Wallem, Bethany Fulcher, Isela Ramirez and Gretchen House, work to get orders put together on Friday, Jan. 6, 2023, at the company’s facility in Monroe, Washington. The company began including pay, benefits and perks to its job listings over a year ago, well ahead of the new statewide mandate to include a pay range on job postings at companies with over 15 employees. (Ryan Berry / The Herald)
New state law requires employers to give pay range in job postings

Washington’s new pay transparency law aims to narrow wage gaps based on race or gender — though some companies may seek loopholes.

Paddywack co-owner Shane Somerville with the 24-hour pet food pantry built by a local Girl Scout troop outside of her store on Tuesday, Dec. 20, 2022 in Mill Creek, Washington. (Olivia Vanni / The Herald)
An out-paw-ring of support: Mill Creek pantry feeds pets, day or night

With help from local Girl Scouts, the Mill Creek pet food store Paddywack is meeting the need for pet supplies in a pinch.

Kelly Cameron is the woodworker behind Clinton-based business Turnco Wood Goods. (David Welton)
Whidbey woodworkers turn local lumber into art

In the “Slab Room” at Madrona Supply Co., customers can find hunks of wood native to the south end of Whidbey Island.

Siblings Barbara Reed and Eric Minnig, who, co-own their parent’s old business Ken’s Camera along with their brother Bryan, stand outside the Evergreen Way location Thursday, Dec. 15, 2022, in Everett, Washington. After five decades in business, Ken’s will be closing its last two locations for good at the end of the year. (Ryan Berry / The Herald)
Print it or lose it: Ken’s Camera closes after decades caught on film

The local legend, processing film photos since 1971, will close its locations in Mount Vernon and Everett at the end of 2022.