The federal Export-Import Bank’s charter quietly expired at midnight Tuesday, leaving it unable to extend new lines of credit to help U.S. companies export their goods and angering President Obama and other supporters, who say the 81-year-old agency bolstered job creation.
But top conservatives bid it good riddance, saying the New Deal product handed out “corporate welfare” and should fade away, even as some in Congress sketched out plans to revive it when lawmakers return to Capitol Hill next month.
“Change doesn’t come fast or easy in Washington, but over the past three years conservatives created the conditions that caused the Export-Import Bank to expire and enter liquidation,” Heritage Action CEO Michael Needham said. “Now it is up to Republican leaders to accept and preserve this major policy victory.”
Indeed, Congress must decide in the coming weeks whether to extend Ex-Im or let it wind down to extinction, as existing lines of credit and insurance policies peter out.
Senate Majority Leader Mitch McConnell, Kentucky Republican, opposes reauthorization but promised to give Ex-Im’s supporters a vote, while Speaker John A. Boehner has made no such commitment on the House side.
Established in 1934, the bank finances the sale of U.S. exports to international buyers, stepping in when private lenders are unwilling to extend credit. Its supporters say the bank helps U.S. goods compete in overseas markets, as foreign governments prop up their companies with similar credit agencies.
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But conservative groups sharpened their attacks on Ex-Im after Mr. Obama’s re-election in 2012, saying they should target reauthorization bills to sunset government programs they view as wasteful or unnecessary. They say Ex-Im is spending billions to prop up corporations who don’t need the help.
“This is a small step toward renewing a competitive free-market economy and arresting the rise of the progressive welfare state and the cronyism connected to it,” House Financial Services Chairman Jeb Hensarling, Texas Republican, said. “Ex-Im is not only corporate welfare, it is corporate welfare for foreign companies and countries.”
The White House accused Republicans of putting ideology before American workers, mere days after backing another piece of Mr. Obama’s trade agenda — fast-track negotiating powers to strike deals with Pacific Rim nations.
Ex-Im extended $20.5 billion in financing in support of $27.5 billion worth of U.S. exports in fiscal 2014, according to an Ex-Im spokesman who said their efforts translated into 164,000 jobs.
As it stands, the bank will no longer be able to conduct new business. That’s left 195 potential transactions in the lurch, according to House Democrats who blasted GOP leaders Tuesday for letting the bank expire.
“We are undermining thousands and thousands of jobs,” House Minority Whip Steny Hoyer, Maryland Democrat, said.
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Much of the GOP presidential field is staunchly opposed to the bank — Sen. Ted Cruz of Texas called it “welfare for big corporations, both foreign and domestic” — although Sen. Lindsey Graham of South Carolina strongly supports its reauthorization.
In the House, centrist Republicans such as Rep. Tom Cole of Oklahoma have voiced support for the bank, writing in op-eds that recipients are required to pay back loans with interest, helping to pay down the national deficit “rather than claim taxpayer dollars.”
Businesses caught in the middle warned Tuesday that failure to extend the bank will have catastrophic effects on employment and international competitiveness.
“The sad truth is that we’re just collateral damage for their ideology,” said Don Nelson, president of California-based ProGauge Technologies. “Members in Congress have little to no business experience and little to no common sense.”
In the Senate, Mr. McConnell will not revive the bank as part of a free-standing bill. But he will allow its supporters, who say they have the votes, to push for reauthorization as an amendment to other legislation.
The chamber is set to debate an extension of the Highway Trust Fund before July 31, “and it’s pretty obvious that that would be a place for this vote to occur,” Mr. McConnell told reporters this month.
Mr. Boehner, Ohio Republican, hasn’t made any firm commitments to either side, as pro-business groups pressure him to extend the bank and conservatives urged him to let it wither and die.
Besides Mr. Hensarling, House Majority Leader Kevin McCarthy and Majority Whip Steve Scalise think the bank should expire.
“The only commitment the speaker has made on Export-Import Bank is to Chairman Hensarling, who asked that — if the Senate attached Ex-Im to a ’must pass’ bill and sent it over to the House — he be allowed to offer amendments under an open process,” Boehner spokesman Kevin Smith said. “The speaker gave the chairman that commitment.”
⦁ Brennan Weiss contributed to this report.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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