WASHINGTON — A fight over a small export credit agency is dividing Congress and holding up a popular bipartisan jobs bill.þþThe Export-Import Bank — a self-financing agency that helps to facilitate the sale of American goods overseas — needs Congressional reauthorization by the end of May. It is also close to hitting its $100 billion lending cap, hobbling its ability to offer new loans, and has asked Congress to raise its financing limit.þþWith those two issues at hand, Congress is arguing over the bank’s future, with some Republicans floating a proposal that might end up abolishing the bank, and Senate Democrats hoping to force its expansion and reauthorization by attaching it to jobs legislation.þþOn Wednesday, Senator Maria Cantwell, Democrat of Washington, introduced an amendment to keep the bank running through 2015 and to increase its loan limit to $140 billion. Senator Lindsey Graham, Republican of South Carolina, is cosponsoring the amendment. The Senate is tying the amendment to the Jumpstart Our Business Startups Act, or JOBS Act, a bill containing a bevy of measures to aid small businesses. The JOBS Act passed the House last week with broad bipartisan support and has won plaudits from the White House.þþ“Allowing the Ex-Im Bank to expire would be a crippling blow to our export economy,” Ms. Cantwell said Wednesday. “Extending the Ex-Im bank will provide certainty for American businesses and help support more private sector job growth.”þþBut some House Republicans are resisting, arguing the Senate should pass the JOBS Act as it is, and that Congress should then turn to reauthorizing — and reforming — the small financing institution.þþThe stand-off has left members of the two chambers trading barbs, and has divided Republicans, many of whom support the bank’s reauthorization. Senate leadership is “choosing to needlessly delay the JOBS bill by adding unrelated provisions,” said Laena E. Fallon, a spokeswoman for Representative Eric Cantor of Virginia, the House majority leader.þþ“This is absolutely a jobs measure,” said Senator Charles E. Schumer, Democrat of New York, speaking alongside Ms. Cantwell. “Once again, the Tea Party faction over in the House is trying to manufacture a controversy. Once again they want to stand in the way of something that will help boost the economy.”þþSome Republicans have denounced the Export-Import Bank as “corporate welfare” and argue that the government should not be doing the market’s job of providing deal financing. They also argue that while Export-Import Bank financing provides a competitive advantage to some American businesses, it effectively disadvantages others.þþRepublican senators have also raised questions about whether the bank operates with sufficient oversight. “Ex-Im is processing more than 90 percent of its loan and guarantee applications without conducting a Congressionally required review of any serious adverse effects of the loan,” a group of six senators, including Jim DeMint of South Carolina, Rand Paul of Kentucky and Tom Coburn of Oklahoma, wrote in February in a letter.þþMr. Cantor has floated draft legislation that would increase the bank’s loan limit to $113 billion and extend its authority to keep lending until June 2013. But the proposal would also require President Obama to “initiate and pursue negotiations” with other major exporting countries to “end subsidized export financing programs and other forms of export subsidies.” Such negotiations might lead to the institution being closed.þþOfficials at the Export-Import Bank argue that the bank levels the playing field for American manufacturers against their foreign competitors. They also said that the bank conducts thorough reviews to ensure that it does not harm any domestic businesses.þþ“We want to make sure that American exporters have the same backing as foreign companies do,” said Fred P. Hochberg, the Export-Import Bank’s president, in an interview in his office overlooking the White House. “Congress is talking about unilateral disarmament.”þþIndeed, virtually all other developed countries, and most major exporters in the emerging markets, have export credit agencies like the Export-Import Bank. They generally approve a far wider range of loans and are bigger in proportion to their countries’ total exports, said Gary Clyde Hufbauer of the Peterson Institute for International Economics, a Washington-based research institution.þþ“Ex-Im mostly finances long-term capital goods sales to developing countries, like selling turbines or airplanes to Asia,” Mr. Hufbauer said. “There just isn’t a lot of private sector financing for those projects.”þþThe Export-Import Bank provides most of its loans to small businesses. But the bulk of its financing in dollar terms goes to major manufacturers, particularly in the airline industry. In the 2011 fiscal year, it provided financing worth $33 billion, supporting $41 billion in exports, it said.þþThe bank’s role in the airline industry forms the backdrop to the Congressional dispute, and has led to a flurry of behind-the-scenes lobbying.þþFor instance, the head of Boeing, a recipient of Export-Import Bank financing, visited Mr. Cantor on the Hill last week to push for the bank’s quick reauthorization. W. James McNerney Jr., Boeing’s chief executive, argued that uncertainty over Washington’s commitment to export financing was already hurting business, people familiar with the discussion said.þþBut Delta has argued that the bank’s financing, facilitating the sale of Boeing aircraft to competitor airlines, would harm its business. The airline has lobbied on the other side.þþDemocratic Senate aides said they expected Ms. Cantwell’s amendment to pass the Senate, where a few Republican members have expressed support for reauthorizing the Export-Import Bank. That leaves it up to the House to either agree to the Senate’s version of the bill, or to see the JOBS act stall before it can reach the president’s desk.
Source: NY Times
