Here’s a case study in rapid radicalization. Just three years ago, the House voted overwhelmingly to extend the charter of the Export-Import Bank and to expand its business of loaning money to boost American exports. Among Republicans, 147 voted yes and 93 voted no.
Nothing much has changed since then. The Export-Import Bank supported itself and generated returns of $675 million for taxpayers last year. Its default rate as of March was under two-tenths of 1 percent.
Yet now Republicans say a majority of the caucus wants to abolish the bank, and the Republican Study Committee — representing 170 House conservatives — has come out against renewing the charter. Opponents in both the House and Senate have so far succeeded in keeping the renewal from coming up for votes (in which a pro-bank, mostly Democratic coalition would almost certainly prevail), and without action the bank will shut down at month’s end.
“Here I am, in the minority of my own conference, fighting to defend the Ex-Im Bank that is the best example of creating jobs in America,” Rep. Chris Collins, R-N.Y., said at a news conference with manufacturers and fellow pro-business Republicans on Wednesday morning. “I am befuddled by what’s going on in the heads of some of my fellow members in my party that want to have the Ex-Im Bank charter expire and cost us thousands upon thousands of small-business jobs.”
Collins shouldn’t be befuddled. Republican presidential candidates trying to harness the populist energy in the electorate have come out against the bank, which has become a bete noire with the tea party set. Conservative groups howling about corporate welfare and big government have, for the moment, bested the corporate interests that have previously co-opted grass-roots conservatives.
There’s little chance the rebellion will kill the bank permanently, but there’s a real chance the bank will close temporarily. At an Ex-Im hearing before the House Financial Services Committee on Wednesday, veteran congressman Frank Lucas, R-Oklahoma, tried to talk sense into his hotheaded GOP colleagues — one of whom, committee chairman Jeb Hensarling of Texas, has bottled up legislation renewing the bank.
“Whether it is 14 days or 14 weeks or 14 months, this institution will be reauthorized,” he said. “It may take a number … of occasions where U.S. companies lose business, substantial business around the world, to help us focus.”
Lucas pointed out that his colleagues’ ideological purity puts the United States in “a position of surrender” with foreign competitors.
“Don’t in a competitive world say that we’re going to establish a principle so perfect, so idealistic, so philosophically straightforward that everyone else will flock to it. That’s not the way it works.”
But most of his colleagues on the panel were happy to surrender for the sake of free-market purity.
“I’m dismayed that some of the best American companies believe that they need special programs and carve-outs like Ex-Im to remain competitive on the global stage,” said Rep. Bill Huizenga, R-Michigan. Calling the bank’s record “abhorrent” and “beyond broken,” he complained that “American taxpayers have been unwittingly propping up foreign state-owned companies” in Saudi Arabia, Russia and elsewhere while the bank “has an unsavory track record involving corruption, bribery and fraud.”
Rep. Scott Garrett, R-N.J., took the counterintuitive position of arguing that the bank, which essentially subsidizes U.S. exports, causes American manufacturers to ship jobs overseas. “How do you make those decisions on a daily basis, knowing that you are hurting families, hurting people, hurting?” he asked of Fred Hochberg, the Ex-Im president. “I just find that unimaginable.”
Perhaps the most curious case against the bank was made by Rep. Sean Duffy, R-Wis., who portrayed Ex-Im as a creature of Democratic presidents. “Mr. Hochberg, have you ever stayed at the White House?” Duffy asked.
“In the 1990s.”
“With Mr. Clinton?”
“Yes, sir.”
“Lincoln bedroom?”
“No, it was actually a different bedroom.”
“OK. And you are an Obama bundler, correct?”
“I raised money for Mr. Obama.”
Duffy, triumphant, said this revealed “your political affiliation.”
It’s true: Hochberg, the political appointee of a Democratic president, supports Democrats. This revelation was almost as shocking as the discovery by lawmakers that Ex-Im has made some bad loans (as virtually all banks have done) and has been defrauded by corrupt actors (as virtually all government entities have been).
All this was true, as well, in 2012, when a large bipartisan majority blessed the Ex-Im Bank. The only thing that has changed is the ideological center of gravity within the GOP.
Dana Milbank is a Washington Post columnist.
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