Led by Majority Leader Kevin McCarthy, conservative House Republicans have embarked on a crusade to kill the obscure but important Export-Import Bank.
They’re so fixated on getting rid of the institution that they’re jeopardizing a crucial highway funding bill. Their brinkmanship is tiresome. Like many of their causes, this one is misguided.
Created during the Great Depression, the low-profile 81-year-old bank makes and guarantees low-interest loans to foreign customers so they can buy U.S. products. The bank offers assistance when commercial lenders won’t; most other competing nations have similar banks.
Exports help create jobs across the nation and particularly in California. While the bank accounts for only about 2 percent of total U.S. exports, it claims credit for supporting 164,000 jobs in fiscal year 2014. According to the White House, the bank has helped about 950 California companies export goods valued at $18 billion over the last six years.
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You can criticize some specific loans, or complain that mega-corporations benefit the most. But that’s an argument for fixing the bank, not killing it. If Republicans want to go after corporate welfare, there are many more significant targets, such as the offshoring of corporate profits and farm subsidies.
The Ex-Im bank isn’t a drain on taxpayers. During the last two decades, it has returned nearly $7 billion from fees, premiums and interest.
It’s no wonder that the bank is backed by more moderate, Chamber of Commerce-backed Republicans and by most Democrats. Congressional renewal of the bank’s charter had been routine and bipartisan.
But in search of a political trophy, the 170 members of the conservative Republican Study Committee – and the advocacy groups behind them, including some funded by the Koch brothers – have targeted the bank. They managed to have the bank’s charter expire June 30, stopping it from making any new loans.
On the other side, Senate Republicans are joining forces with Democrats to try to resurrect the bank. Their latest tactic is to attach the measure to a bill that must be passed by July 31 before highway funding runs out.
The Senate could act this week, unless Sen. Ted Cruz of Texas – among the Republican presidential wannabes speaking out against the Ex-Im bank – carries through on a filibuster threat.
McCarthy used to support the Ex-Im bank. Businesses in his district and the Central Valley benefit from it. Now, he’s leading the charge against it.
His spokesman sent a terse statement repeating that McCarthy “believes the private sector should fill the role of the bank,” even though it exists precisely for when private banks won’t do so.
McCarthy is positioning himself to be the next House speaker should John Boehner step aside or be forced out. Locking up support of the House conservative caucus would be a huge advantage. Whatever he and his allies are up to, responsible governing it’s not.