To someone new to the scene, it might seem as if both major parties are engaged in a war on exports.
[Reposted from USA Today | Editorial Board | July 12, 2015]
Democrats took the offensive first, trying to kill an emerging Pan-Pacific trade agreement just as American manufacturers have become highly competitive and are looking for new markets overseas.
Now some Republicans have gotten into the act, too. They’re out to kill the Export-Import Bank of the United States, an agency that provides financing for foreign buyers of American goods. If they succeed, it will be a monumentally stupid, self-inflicted wound to the economy.
The bank’s charter expired at the end of June. It’s in a kind of limbo waiting for Washington to find some reason to renew it. The bank won’t be able to make or back any new loans, and it will soon wither and die if Congress doesn’t act.
Why would Congress want to allow that to happen? It’s not as though the bank is costing taxpayers money; it made a $675 million profit last year, mainly from loan fees and interest, by helping American companies sell their wares abroad. And why would lawmakers want to make the United States one of the few developed nations without an export financing organization?
The only answers are crassly political. A vocal and ascendant right wing (joined by a handful on the far left) sees killing a bank that helps big corporations such as Boeing and General Electric as a good way of attacking “corporate welfare.”
The Club for Growth, Heritage Action and other conservative groups see an added attraction. By killing the Export-Import Bank, they can claim a trophy. And a trophy, any trophy, helps them establish themselves as power brokers and gatekeepers within the Republican Party.
The truth is, American manufacturers want and need the Export-Import Bank, created in 1934. It has a long history of bipartisan support in Washington and broad-based business support throughout the country.
At least 59 other nations have institutions similar to the Export-Import Bank. And many go much further. China’s system of providing tax credits and various forms of insurance to exporters, for instance, far exceeds anything Washington does.
Perhaps in a perfect world, governments would not get into the business of assisting or subsidizing exports. But in the world in which American companies actually operate, they do.
Foreign governments also buy lots of things, particularly aerospace and defense products, construction equipment and power production technology. These governments expect a government financing organization on the other end to guarantee their loans and assist in other ways.
The Export-Import Bank says it supports 164,000 jobs. That might be an exaggeration. Even so, killing it would undoubtedly lead to the loss of tens of thousands of jobs, particularly the kinds of manufacturing jobs that people with less than a college education struggle to find.
After months of fighting, it seems the battle over the Pacific trade pact might be headed toward a satisfactory end. Now it’s time for Congress to come to its senses and save the Export-Import Bank.
USA TODAY’s editorial opinions are decided by its Editorial Board, separate from the news staff. Most editorials are coupled with an opposing view — a unique USA TODAY feature.