Ahead of Friday Deadline, Conservatives Harden Opposition to the Export-Import Bank
The most conservative members of the Republican party are hardening opposition to the Export-Import Bank.
The fate of the Export-Import Bank, a key funding source for small businesses that want to do business abroad, and whose charter expired at the beginning of July, will soon be in the hands of the House of Representatives. Conservative lawmakers there are now preparing to buck their party’s mainstream in an attempt to kill something the White House and U.S. businesses say is necessary to stay competitive globally.
If this sounds familiar, it should.
A similar scenario played out in June, during the debate about fast track trade authority, something President Barack Obama and GOP leadership said was needed to push through trade bills like the Trans Pacific Partnership and the Transatlantic Trade and Investment Partnership. Conservative Republicans teamed up with some Democrats, including Rep. Nancy Pelosi, a close ally of the White House, to delay its passage. Obama ultimately got what he wanted when the renegade Democrats, boxed in by their leader, relented and voted for fast track.
This time, however, conservative members of the GOP and those affiliated with the Tea Party are on their own. Populist Democrats who initially rejected Obama on trade in this case support the bank, known as the Ex-Im. During a rare Sunday vote, senators voted 67 to 26 to attach the bank’s reauthorization to the highway bill, which faces a Friday deadline. The highway bill either has to pass by then, the House could vote on for a five-month extension, or some other compromise must be reached.
But that doesn’t mean Republicans can’t slow down the process. House Speaker John Boehner (R-Ohio) wants the bank reauthorized. But House Majority Leader Kevin McCarthy (R-Calif.) said Monday he would not bring the bill to the floor of the lower chamber. Rep. Jeb Hensarling (R-Texas), chairman of the House Financial Services Committee, also has said he would not support the bill.
The bank, created by executive order in 1934, provided $20.5 billion in financing in 2014. Of that, $5 billion went to American small businesses trying to grow their share in overseas markets. The remaining $15.5 billion went to larger corporations, something that the bank’s critics have seized upon. Populist Republicans and right-wing members of the GOP say the bank provides “corporate welfare,” as Hensarling has argued, and “crony capitalism,” one of Sen. Ted Cruz’s (R-Texas) preferred criticisms. On Monday, the conservative Heritage Action Committee praised McCarthy.
“Proponents have spent tens of millions of dollars to save this slush fund for corporate welfare. And they failed,” Dan Holler, a spokesperson for the group, told FP Monday.
Last week, Obama said renewing the bank’s charter is a “no-brainer.” In a commentary published by CNBC Monday, U.S. Commerce Secretary Penny Pritzker and Export-Import Bank CEO Fred P. Hochberg said the bank ensures “that the U.S. does not cede ground in the race for economic and job growth.” According to the bank, it facilitated $27.5 billion worth of exports in 2014,and supported 164,000 American jobs in 2014.
The Senate could approve the highway bill continuing the reauthorization as early as Monday evening. So far, it hasn’t been a pretty process. Cruz, strongly opposed to the deal, accused Sen. Majority Leader Mitch McConnell (R-Ky.) of lying about the legislative process surrounding the bank. Cruz drew a stern rebuke from McConnell and other senior Republicans on Sunday.
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