Friday, October 23, 2015
Billy Long: Congress must reauthorize Export-Import Bank
Earlier this month, I joined a large group of my House colleagues in signing a discharge petition to reauthorize the Export-Import Bank of the United States – more commonly known as “the Ex-Im Bank” – through FY 2019. Unfortunately, after more than 80 years of supporting American jobs and boosting domestic exports, the Ex-Im Bank expired this past July as Congress failed to pass its reauthorization.
Since the 1930’s, Ex-Im has provided insurance and loan guarantees to foreign buyers of American products and protects domestic producers of exported products against defaulters. It’s been a critical part of our country’s history – making the Pan American Highway a reality, helping to keep airlines flying after September 11th, and weathering the 2008 financial crisis while many other banks were unable to.
Ex-Im ensures fair fees and interest are paid to domestic producers for their products. In FY 2014 alone – the last full year Ex-Im was authorized – the bank generated a $675 Million profit without expending a single tax dollar. Over the past two decades, the bank has helped reduce federal debt with a surplus of nearly $7 billion dollars returned to the U.S. Treasury – proving Ex-Im is a valuable asset against deficit spending in Washington.
In the global market, the absence of the Ex-Im Bank puts us at a major disadvantage. Currently, there are about 40 countries that have an equivalent of Ex-Im to protect their own economies. Many of these banks bar foreign companies who wish to gain their country’s available contracts from bidding on contracts unless their country has a national export credit agency – like Ex-Im. Already, General Electric has announced that it will move 500 jobs to France, Hungary, and China so that they can continue bidding on foreign contracts as they would have done here in the U.S.
Contrary to popular belief, private-sector lenders are Ex-Im’s partners – not its competitors. The bank fills export financing gaps when the private sector is unwilling to do so in order to enhance the free-market. Small and medium sized exporters are the primary users of Ex-Im. When larger companies use the bank to finance export sales, their employees and small business suppliers are the primary beneficiaries of profit. Overall, in FY 2014, nearly 90% of Ex-Im Bank transactions directly supported small businesses while 98% involved independent commercial financial institutions.
In The Ozarks, every kind of business from stainless steel manufacturers to limousine builders depend on Ex-Im. The bank accounted for nearly $1.5 Billion in export sales and supported more than 9,000 jobs across 125 companies last Fiscal Year in our state. Additionally, the Ex-Im bank has supported as many as 1.3 Million private sector jobs across America since 2009.
As a conservative, I realize that no federal entity or organization is free from needing reforms. But no matter which reforms must be made, the Ex-Im bank still fulfills an undeniable major economic purpose that boosts American businesses and plays an important role in our global economic standing. It’s critical that Congress votes on the bank’s reauthorization immediately before more jobs move overseas, American companies lose contracts with foreign investors, and our economy suffers as a whole.