For 85 years, the federal Export-Import Bank has helped American corporations compete in the global marketplace. Now it is in need of reauthorization from Congress.
In recent years in Clark County, the bank has supported companies such as Conquest Consulting Group, Northwest Natural Products and Neil Jones Food Company. Across Washington, it has supported companies large and small in every region. About 90 percent of businesses that use Ex-Im Bank services are small businesses that provide local jobs and contribute to the local tax base.
The Ex-Im Bank, which provides and guarantees loans to help foreign entities make purchases from U.S. companies, is particularly important in our state, where an estimated 40 percent of all jobs are tied in some fashion to international trade.
According to a report released Aug. 1 by the Washington Council on International Trade, Washington exports supported by the Export-Import Bank were associated with 25,200 jobs between 2014 and 2018. This is in spite of a significant drop in lending by the bank between 2016 and 2018 as a result of Washington, D.C., politics.
Which brings us to the crux of the issue: Congress should act quickly to reauthorize the Export-Import Bank before authorization runs out on Sept. 30.
For decades, the need for reauthorization was rarely questioned. The Ex-Im Bank routinely has been reapproved with bipartisan support because of the role it plays in making the United States the global leader in international trade.
But in recent years the bank has become a political football, coming under fire from Tea Party Republicans and libertarians. Critics say the bank amounts to untoward government interference in the marketplace, choosing winners and losers among U.S. companies.
That led Congress to allow the Ex-Im Bank’s authorization to lapse for a time in 2014. After that authorization was reapproved in 2015, Congress greatly reduced funding and the Senate declined to fill positions on the bank’s board. The lack of a quorum on the board meant that loans of $10 million or more could not be approved. Sen. Maria Cantwell, D-Wash., has said the number of Washington jobs supported by the bank plummeted from 39,000 in fiscal 2014 to 650 in fiscal 2018.
Criticisms of the banks have been shortsighted while ignoring the reality of international trade. The fact is that many foreign manufacturers receive subsidies from their governments or loan assistance that places U.S. manufacturers at a disadvantage.
In addition, the bank makes money for the U.S. Treasury. Over the past decade, the Ex-Im Bank has returned $5.2 billion to federal coffers while providing services unavailable in the private market. As the Washington Council on International Trade explains, “Because it is backed by the full faith and credit of the United States, the Ex-Im Bank assumes credit and country risks that the private sector is unable or unwilling to accept.”
The bank’s renewal is particularly important at a time when federal policy is undermining international trade. President Donald Trump’s tariffs have made clear that trade wars are not easily won, and their impact is being felt in Washington — the nation’s most trade-dependent state.
Last month, Cantwell and fellow Washington Sen. Patty Murray co-sponsored legislation that would authorize the bank for 10 years and create other support mechanisms. The measures warrant consideration. Supporting the Ex-Im Bank would be more beneficial for the economy than attempting to undermine it.