Ex-Im Reauthorization Fight Resumes this FallSeptember 10, 2015
Congress has returned from August recess with a long list of priorities, among those they will wrestle with this fall are a number of trade issues, including the continuing drama over the reauthorization of the U.S. Export-Import Bank (Ex-Im). Opponents of the government-run lender won a victory when its charter expired at the end of June, but supporters—including the National Small Business Association—still hope for a long-term renewal of the bank as part of a highway funding bill, or some other vehicle.
Ex-Im’s charter expired on June 30, and with its authority lapsing for the first time in the Bank’s 81-year history, Ex-Im can no longer process new applications. It is, however continuing to oversee existing financing, but it is unclear how much longer the bank can continue its current level of operations absent a renewal of its charter this fall.
Prior to August recess, efforts to reopen the Export-Import Bank, which has helped thousands of U.S. companies export their goods, lost significant ground as House lawmakers approved a short-term highway funding bill that did not include new authority for the bank. Supporters of Ex-Im, including President Barack Obama, bipartisan majorities in the House and Senate as well as leading business groups, had hoped to attach a measure reauthorizing the bank’s charter to the highway bill.
Ex-Im helps to create and maintain U.S. jobs by filling gaps in private export financing at no cost to the American taxpayers—providing a variety of financial mechanisms, including working capital financing, export-credit insurance and financial guarantees to help foreign buyers purchase U.S. goods and services.
In late July, the Senate agreed to its version of a highway funding bill that included an amendment which would reinstate and extend Ex-Im Bank’s charter through Sept. 30, 2019 and raise the percentage of the agency’s operations that must go toward supporting small businesses from 20 to 25 percent. The amendment, introduced by Sens. Mark Kirk (R-Ill.) and Heidi Heitkamp (D-N.D.), was approved by the Senate 64-29.
Although a clear majority in the House supports resurrecting the agency, it was up to House leaders to decide whether the chamber would get a vote, or whether it would allow the bank’s powerful opponents—led by House Majority Leader Kevin McCarthy (R-Calif.), Majority Whip Steve Scalise (R-La.), Ways and Means Committee Chairman Paul Ryan (R-Wis.) and Financial Services Committee Chairman Jeb Hensarling (R-Texas)—to stand in the way. Ultimately, the opponents won out and the House voted 385 to 34 to approve a three-month extension of the highway funding without a provision reauthorizing the bank, and the Senate followed suit soon after.
The issue continues to split the Republican and Democratic parties with some members of each insisting that the bank is essential to U.S. exports and therefore to U.S. jobs, while others assert it is corporate welfare for a few big companies. The congressional situation is a sign of true dysfunctionality when two-thirds of the House and of the Senate support reauthorization, but legislation has failed to pass because of the extremes of the two parties. It is expected attempts will be made this fall at reauthorizing the bank through either a continuing resolution to fund the government, normal appropriations legislation, or attaching it to another large measure, such as a long-term highway bill.