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Candidate Obama: Ex/Im Bank is corporate welfare
President Obama: We need Ex/Im Bank to help our companies compete globally
Candidate Trump: Ex/Im Bank is corporate welfare
President Trump: We need Ex/Im Bank to help our companies compete globally
In Ending Ex-Im Bank Impasse, Trump Sides With Business Establishment
President turned aside conservative Republicans who wanted to cripple the export-finance agency
When President Donald Trump signaled Wednesday he would end a yearslong debate within the Republican Party over the U.S. Export-Import Bank, he sided with the business establishment to restore an agency that some conservative Republicans, including members of his own administration, wanted to cripple.
Mr. Trump’s apparent about-face had been telegraphed two months ago, when he pledged in a private meeting with lawmakers his support for the agency that backs U.S. exports. But Mr. Trump hadn’t publicly committed to reviving the bank until his comments in an interview with The Wall Street Journal on Wednesday.
The president’s backing of the Ex-Im Bank concludes a debate stretching back to 2012, when conservative Republicans emboldened by the tea party movement targeted the agency as an example of corporate welfare they said distorted markets.
The bank’s backers say the agency allows U.S. companies to compete on equal footing against foreign rivals that receive similar support from their home governments, and Mr. Trump on Wednesday recited many of the arguments used for years by the bank’s biggest customers, Boeing Co. and General Electric Co.
Mr. Trump had made only fleeting—and sometimes contradictory—statements about the bank during the 2016 campaign. “I was very much opposed to Ex-Im Bank, because I said what do we need that for IBM and General Electric,” he said Wednesday. “It turns out that, first of all, lots of small companies will really be helped, the vendor companies. But also maybe more importantly, other countries give it, and…we lose a tremendous amount of business.”
Mr. Trump also pointed to the bank’s history of turning a profit for the U.S. government under federal accounting rules. “It’s a very good thing, and it actually makes money,” he said. “You know, it actually could make a lot of money.”
Republican critics of the bank said they were discouraged by Mr. Trump’s comments and hoped he would reconsider. “You’re picking winners and losers. That’s the crony aspect and that does not help to drain the swamp,” said Rep. David Brat (R., Va.).
The bank had become a rallying cry by the conservative grass roots against GOP leaders who had supported it, including then-Rep. Eric Cantor (R., Va.), the House majority leader who was defeated by Mr. Brat in a 2014 primary election, and House Speaker John Boehner (R., Ohio), who resigned from Congress in October 2015.
The bank’s charter expired in July 2015 but was reauthorized at the end of that year over the objections of some GOP leaders, ending a five-month shutdown. Large majorities in both the House and Senate—including a majority of House Republicans—voted to reauthorize the bank.
But the bank, which was backed by President Barack Obama, hasn’t been able to approve financing for deals of more than $10 million because Sen. Richard Shelby (R., Ala.), who served until January as the chairman of the Senate Banking Committee, refused to allow confirmation votes for vacant seats on the bank’s board.
The Ex-Im Bank’s lending volumes plunged during the impasse. Loan guarantees and other export credit agreements fell 76% in the two years ended last September, and the $5 billion in financing extended last year supported just 52,000 jobs, the lowest number since 1971.
While the bank still sent $284 million to the U.S. Treasury last year, Ex-Im officials have warned that if it can’t process larger transactions, the bank will be unable to cover its costs at some point in the coming year, which could further amplify calls to shut the institution.
Just how Mr. Trump would resolve the issue was unclear until this week. At the bank’s annual conference in Washington last week, bank officials said they had been in contact with Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross Jr. , but weren’t sure how the administration would address the bank’s board vacancies.
The bank has an acting chairman and vice chairman until Mr. Trump picks his own nominees. Three other board seats are empty.
Mr. Trump elevated two officials in his administration who led groups sharply critical of the Ex-Im Bank during the congressional standoff, which further added to the mystery over which side the administration would take in the debate.
Marc Short, Mr. Trump’s legislative director, had served as president of Freedom Partners Chamber of Commerce, a political advocacy group backed by billionaires Charles and David Koch that led the Ex-Im Bank opposition. Russ Vought, whom Mr. Trump nominated last week as the deputy budget director, served as political director at Heritage Action for America, an advocacy group that also rallied conservatives to cripple the bank.
The bank’s current leadership, meanwhile, said it had worked from the start of the Trump administration to highlight how the Ex-Im Bank could help advance the administration’s export and manufacturing-related goals.
“It became apparent early on there was a debate going on within the administration, and I wanted to make sure our views within the agency were included in that debate,” said Charles J. Hall, the bank’s acting chairman since January, who had served in various senior positions since 2013.
Mr. Trump ultimately cast his lot with the business establishment. Sen. Heidi Heitkamp (D., N.D.) pressed Mr. Trump to fill the bank’s vacancies at a February meeting with lawmakers at which he said he had initially been swayed by the bank’s GOP critics until he learned more about its mission from Dennis Muilenburg, Boeing’s chief executive, according to a person familiar with the discussion.
“I always said during the fight over reauthorization, I’ve never seen an administration want to get rid of Ex-Im,” said Tony Fratto, an official in the George W. Bush administration who advises on communications strategy for companies including Citigroup Inc. and General Electric. “Once an administration comes in and takes a good look at it, they understand it’s valuable to the country, and they want to retain it.”
https://www.wsj.com/articles/in-end...-sides-with-business-establishment-1492101609
Candidate Obama: Ex/Im Bank is corporate welfare
President Obama: We need Ex/Im Bank to help our companies compete globally
Candidate Trump: Ex/Im Bank is corporate welfare
President Trump: We need Ex/Im Bank to help our companies compete globally
In Ending Ex-Im Bank Impasse, Trump Sides With Business Establishment
President turned aside conservative Republicans who wanted to cripple the export-finance agency
When President Donald Trump signaled Wednesday he would end a yearslong debate within the Republican Party over the U.S. Export-Import Bank, he sided with the business establishment to restore an agency that some conservative Republicans, including members of his own administration, wanted to cripple.
Mr. Trump’s apparent about-face had been telegraphed two months ago, when he pledged in a private meeting with lawmakers his support for the agency that backs U.S. exports. But Mr. Trump hadn’t publicly committed to reviving the bank until his comments in an interview with The Wall Street Journal on Wednesday.
The president’s backing of the Ex-Im Bank concludes a debate stretching back to 2012, when conservative Republicans emboldened by the tea party movement targeted the agency as an example of corporate welfare they said distorted markets.
The bank’s backers say the agency allows U.S. companies to compete on equal footing against foreign rivals that receive similar support from their home governments, and Mr. Trump on Wednesday recited many of the arguments used for years by the bank’s biggest customers, Boeing Co. and General Electric Co.
Mr. Trump had made only fleeting—and sometimes contradictory—statements about the bank during the 2016 campaign. “I was very much opposed to Ex-Im Bank, because I said what do we need that for IBM and General Electric,” he said Wednesday. “It turns out that, first of all, lots of small companies will really be helped, the vendor companies. But also maybe more importantly, other countries give it, and…we lose a tremendous amount of business.”
Mr. Trump also pointed to the bank’s history of turning a profit for the U.S. government under federal accounting rules. “It’s a very good thing, and it actually makes money,” he said. “You know, it actually could make a lot of money.”
Republican critics of the bank said they were discouraged by Mr. Trump’s comments and hoped he would reconsider. “You’re picking winners and losers. That’s the crony aspect and that does not help to drain the swamp,” said Rep. David Brat (R., Va.).
The bank had become a rallying cry by the conservative grass roots against GOP leaders who had supported it, including then-Rep. Eric Cantor (R., Va.), the House majority leader who was defeated by Mr. Brat in a 2014 primary election, and House Speaker John Boehner (R., Ohio), who resigned from Congress in October 2015.
The bank’s charter expired in July 2015 but was reauthorized at the end of that year over the objections of some GOP leaders, ending a five-month shutdown. Large majorities in both the House and Senate—including a majority of House Republicans—voted to reauthorize the bank.
But the bank, which was backed by President Barack Obama, hasn’t been able to approve financing for deals of more than $10 million because Sen. Richard Shelby (R., Ala.), who served until January as the chairman of the Senate Banking Committee, refused to allow confirmation votes for vacant seats on the bank’s board.
The Ex-Im Bank’s lending volumes plunged during the impasse. Loan guarantees and other export credit agreements fell 76% in the two years ended last September, and the $5 billion in financing extended last year supported just 52,000 jobs, the lowest number since 1971.
While the bank still sent $284 million to the U.S. Treasury last year, Ex-Im officials have warned that if it can’t process larger transactions, the bank will be unable to cover its costs at some point in the coming year, which could further amplify calls to shut the institution.
Just how Mr. Trump would resolve the issue was unclear until this week. At the bank’s annual conference in Washington last week, bank officials said they had been in contact with Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross Jr. , but weren’t sure how the administration would address the bank’s board vacancies.
The bank has an acting chairman and vice chairman until Mr. Trump picks his own nominees. Three other board seats are empty.
Mr. Trump elevated two officials in his administration who led groups sharply critical of the Ex-Im Bank during the congressional standoff, which further added to the mystery over which side the administration would take in the debate.
Marc Short, Mr. Trump’s legislative director, had served as president of Freedom Partners Chamber of Commerce, a political advocacy group backed by billionaires Charles and David Koch that led the Ex-Im Bank opposition. Russ Vought, whom Mr. Trump nominated last week as the deputy budget director, served as political director at Heritage Action for America, an advocacy group that also rallied conservatives to cripple the bank.
The bank’s current leadership, meanwhile, said it had worked from the start of the Trump administration to highlight how the Ex-Im Bank could help advance the administration’s export and manufacturing-related goals.
“It became apparent early on there was a debate going on within the administration, and I wanted to make sure our views within the agency were included in that debate,” said Charles J. Hall, the bank’s acting chairman since January, who had served in various senior positions since 2013.
Mr. Trump ultimately cast his lot with the business establishment. Sen. Heidi Heitkamp (D., N.D.) pressed Mr. Trump to fill the bank’s vacancies at a February meeting with lawmakers at which he said he had initially been swayed by the bank’s GOP critics until he learned more about its mission from Dennis Muilenburg, Boeing’s chief executive, according to a person familiar with the discussion.
“I always said during the fight over reauthorization, I’ve never seen an administration want to get rid of Ex-Im,” said Tony Fratto, an official in the George W. Bush administration who advises on communications strategy for companies including Citigroup Inc. and General Electric. “Once an administration comes in and takes a good look at it, they understand it’s valuable to the country, and they want to retain it.”
https://www.wsj.com/articles/in-end...-sides-with-business-establishment-1492101609
