By Damian Paletta
WASHINGTON--President Barack Obama on Friday called for Congress
to reauthorize the U.S. Export-Import Bank, saying the political
impasse is hurting U.S. companies as they compete against foreign
firms.
Mr. Obama's comments, which came at a news conference in
response to an unrelated question, illustrate how pressing the
Obama administration is starting to view the gridlock over the
relatively arcane agency now at the center of a fierce political
fight.
He used the analogy of running a Ford dealership, and he said he
would be at a competitive disadvantage if a Toyota dealership
across the street were allowed to offer financing for its
automobiles but he was prevented from offering loans. This is
essentially one of the services the Ex-Im Bank offers, though some
of its loan guarantees can be for more than $1 billion.
A number of prominent Republicans, including House Financial
Services Committee Chairman Jeb Hensarling (R., Texas), House
Majority Leader Kevin McCarthy (R., Calif.) and House Budget
Committee Chairman Paul Ryan (R., Wis.) have said the bank's
charter shouldn't be reauthorized when it expires at the end of
September. They have criticized the bank as representing "crony
capitalism," allowing the government to help a select number of
companies win business overseas.
Mr. Ryan on Wednesday said the Ex-Im Bank exemplified "big
government and big business joining in a common cause to hand out
preferences, and I believe that we as Republicans should be
pro-market, not necessarily pro-business."
A majority of Democrats and a number of Republicans have said
they want the 80-year-old agency to be reauthorized. They have
argued--and Mr. Obama stated on Friday--that if the agency isn't
renewed, U.S. companies will lose bids to foreign competitors that
are backed by their own export-credit agencies.
"We will lose business and we will lose jobs if we don't pass
it," Mr. Obama said.
The Ex-Im Bank offers loan guarantees, credit insurance and
loans to help U.S. companies and U.S. subsidiaries of foreign
companies sell their products overseas. Boeing Co. is the agency's
single-largest beneficiary, as Ex-Im helps the aircraft
manufacturer sell planes to foreign airlines. A number of other
companies--big and small--also benefit. Mr. Obama mentioned Boeing
and General Electric Co. as being caught in the middle of the
fight.
"For some reason, right now the House Republicans have decided
that we shouldn't do this, which means that when American companies
go overseas and they're trying to close a sale on selling Boeing
planes, for example, or a GE turbine or some other American product
that has all kinds of subcontractors behind it and is creating all
kinds of jobs and all of sorts of small businesses depend on that
sale...we may lose that sale," Mr. Obama said Friday.
Some liberals, including Mr. Obama, have had more complex views
of the agency in past years. As a senator from Illinois, Mr. Obama
criticized the agency for representing a cozy relationship between
certain businesses and the government, and Sen. Bernie Sanders, an
independent from Vermont, has likened it to corporate welfare. Mr.
Obama has supported the agency since becoming president,
however.
The bank's charter came close to expiring a few years ago, but
it was rescued in part by a deal struck by then-House Majority
Leader Eric Cantor (R., Va.). When Mr. Cantor recently lost his
primary for re-election, many felt that Ex-Im Bank's future hung in
the balance. A recent House hearing illustrated the split within
the House GOP over the agency, with Mr. Hensarling and other
lawmakers saying the agency distorts competition and a separate
group saying it helps jobs in their districts.
Mr. Hensarling has suggested he could be open to a compromise,
but he has said he won't reauthorize the "status quo."
In the Senate, a number of Democrats and one Republican--Sen.
Mark Kirk of Illinois--this week introduced a bill that would
reauthorize the Ex-Im Bank. The U.S. Chamber of Commerce has said
it supports the measure, and business groups are planning to use
the August congressional recess to lobby lawmakers to support the
bank.
But there is no certain path forward in either the House or the
Senate. A number of lobbyists believe that because time is running
out, lawmakers could decide to extend the bank's charter for three
months, and then revisit the issue during a lame-duck session of
Congress after the November elections.
Ex-Im Bank is facing scrutiny on a number of fronts. It recently
dismissed three employees and has placed another on administrative
leave amid investigations into improper behavior, including
allegations of accepting kickbacks. The Justice Department is
currently investigating at least some of these cases.
Write to Damian Paletta at damian.paletta@wsj.com
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