Ex-Im Bank Debate Continues as Deal Gets Closer
On Tuesday, the Information Technology and Innovation Foundation (ITIF) held a debate entitled: “U.S. Ex-Im Bank Financing is a Vital Component of U.S. Competitiveness.” The debate held in the Congressional Auditorium focused on the future of the Export-Import Bank of the U.S. (Ex-Im Bank) and its continued role as a key driver of U.S. exports and competitiveness.
ITIF’s Robert Atkinson and the Lexington Institute’s Loren Thompson took the “pro” side, arguing that the Ex-Im Bank remains a vital element of U.S. competitiveness and its authorization levels should increase. The CATO Institute’s Sallie James and Andrew Roth of Club for Growth took on the “con” side, arguing that the Ex-Im Bank is an unwarranted intrusion in the marketplace.
NSBA and its international trade arm–the Small Business Exporters Association–has been an outspoken proponent for Ex-Im Bank, urging Congress to pass a long-term reauthorization which includes an appropriate increase in the Bank’s lending authority.
Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. The Bank provides a variety of financing mechanisms, including working capital financing, export-credit insurance and financial guarantees to help foreign buyers purchase U.S. goods and services.
Since 1945, the Ex-Im Bank has played a vital role in boosting U.S. exports and competitiveness by providing over $500 billion in financing and insurance for export transactions. In 2010 alone, the Ex-Im Bank provided $24.5 billion worth of export credit financing which backed $34.4 billion worth of U.S. exports, supporting 227,000 jobs at 3,300 U.S. companies.
But with the current Congressional authorization of the Ex-Im Bank set to expire on May 31, 2012—and Congress currently in the midst of deliberation on Ex-Im Bank reauthorization—some have challenged the continued need for the Ex-Im Bank and its mission of providing credit financing to U.S. exporters. This debate highlighted some of these concerns.
Timing remains critical as the expiration is fast approaching. Coupled with the fact that the extension includes no increase in its lending cap and there are two House recesses between now the current extension’s expiration, there are few legislative days to reauthorize the Bank.
The Bank has historically had bipartisan support and last September the Senate Banking Committee unanimously passed a bill to renew the Bank’s charter to 2015 and raise its lending authority to $140 billion, from the current $100 billion level. Typically reauthorized every four years, the Bank is fast approaching its lending cap of $100 billion. At issue are the length of the Ex-Im’s charter and how high to raise the cap. Proposed lending limits have ranged from $113 billion to $140 billion, with talk of a compromise in the $130 billion range.
Leadership realizes the urgency and on the House side, Majority Leader Eric Cantor (R-Va.) and Minority Whip Steny Hoyer (D-Md.) have diligently been working together to strike a bipartisan deal that could garner enough votes to bypass some of the conservative lawmakers’ opposition. Aside from working out the particulars of length of time and amount of money in loan authority, they also are looking at including other needed reforms and accountability measures.
And then there is the issue of the legislative vehicle appropriate for moving Ex-Im reauthorization forward. Senate leaders oppose bringing it up as a stand-alone measure and would prefer it be attached to another bill—one that could easily pass the House. Cantor and Hoyer are discussing what it could be attached to that guarantees it would pass.
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