Senator seeks support for bank extension
Cantwell says Export-Import Bank is vital for jobs
April 5, 2012 - Updated: 5:55 a.m.
Washington Sen. Maria Cantwell came to Spokane Wednesday to urge support for the Export-Import Bank, a federal agency that provides loan guarantees to foreign buyers of American-made products.
The Ex-Im Bank, as it’s called, was created in the 1930s. Its current authorization expires May 31, and Cantwell and others favor a four-year extension. But she has tried and failed, so far, to move a bill through the Senate that would accomplish that goal.
On Wednesday, she urged a group of blue-collar workers at SCAFCO in Spokane Valley to voice their concerns. “It’s all about competition and keeping jobs,” the West Side Democrat told workers at the company, which sells grain silos worldwide and has received support through the Ex-Im Bank.
In interviews during the visit, Cantwell said efforts to keep the bank operating are stalled by one likely and one unlikely opponent: tea party Republicans who’d like the government agency to go away, and Delta Air Lines, which contends the bank’s subsidized financing for overseas carriers hurts U.S. airlines.
“We need to put aside politics and bickering,” Cantwell said, noting that many conservatives and pro-business groups, including the U.S. Chamber of Commerce, support reauthorizing the bank.
Larry Stone, president and CEO of SCAFCO, noted that since 2003 Ex-Im support has helped his company make deals with silo buyers in 11 countries. It began with the bank underwriting insurance on a contract he signed for $50,000 in sales to a South African company.
Stone said U.S. banks shy away from lending based on overseas receivables. Because Ex-Im stepped in, SCAFCO continued dealing with the South African company, landing a deal last year for $2 million in sales. Stone said those deals help make his 275 workers’ jobs more secure.
In 2011, the Ex-Im Bank provided SCAFCO and six other Eastern Washington exporters with $6.5 million in guarantees or loans backed by its assets. Under its charter Ex-Im has a total lending limit of $100 billion. Cantwell and others want to raise the limit to $140 billion.
Opponents to reauthorization call the Ex-Im Bank a form of corporate welfare. They argue that U.S. companies should be competing in a free market, and that the bank tilts in favor of a select group of larger businesses.
Delta Air Lines and a group called Airlines for America assert that the bank doesn’t consider the impact on the U.S. airline industry when making deals, such as a $3.4 billion loan guarantee for aircraft financing to Air India.
That deal involved Boeing selling 30 planes to Air India. Airlines of America filed suit against the bank on behalf of a number of U.S. airlines, including Southwest and Delta. The lawsuit claims the bank’s loan guarantees create a taxpayer subsidy that would create new U.S.-to-India flights, undercutting efforts by domestic carriers to reach the Indian market.
Cantwell said the reauthorization bill contains some amendments, including new language that requires more transparent reporting by the Ex-Im Bank in future deals.
The trouble, she added, is the current partisan political climate. This year’s bill, she noted, is the first time she knows of that the Ex-Im Bank, which has always had bipartisan support, has been subject to a highly charged political battle.
The biggest benefactor of Ex-Im financing in Eastern Washington, in 2011: Commercial Creamery, for $2.4 million.