Republicans biggest obstacle to Eximbank renewal, chief says
WASHINGTON/NEW YORK |
WASHINGTON/NEW YORK (Reuters) - The head of the U.S. Export-Import Bank on Friday said Republicans were the biggest obstacle to renewal of the nearly 80-year-old bank's charter and said the inaction creates business uncertainty, thwarts exports and threatens jobs.
"I do not know how this is going to end. We have been working hard for a year to get reauthorized because the Eximbank is a no-cost jobs bill," Eximbank President Fred Hochberg told Reuters. "This should have been done in September."
The Eximbank provides financing to help big U.S. exporters like Boeing and many smaller companies make sales considered too risky by private banks. Its charter is generally renewed for four or five years at a time, but the bank has been operating on temporary authority since October.
The Republican group Club for Growth has branded the bank as "corporate welfare," and urged lawmakers to allow the bank to expire when its extension ends on May 31.
Hochberg rejected that charge, saying the bank operates "at no cost to the taxpayers" since it collects fees on its loans that cover all of the bank's expenses. The bank has made a $1.9 billion profit over the last five years.
President Barack Obama's administration has also asked Congress to raise the bank's credit exposure cap to $140 billion, from $100 billion currently. A bill stalled in Congress would hike it to $135 billion.
Asked if Republicans were offering the most resistance to reauthorizing the bank's charter, Hochberg said: "Yes, that would be without question."
"I think there are members of Congress who are concerned about any debt level," Hochberg added, when asked if the administration's request to increase the exposure cap was a major reason for the legislative delay.
Unless Congress acts soon, the bank could hit its lending limit in six or so weeks, forcing it to stop making loans and putting future exports at risk, Hochberg said.
Exporters have some $30 billion to $40 billion worth of deals that need financing, but the bank has only about $10 billion worth of lending ability left before it hits its ceiling.
"We're sitting here wringing our hands should (the credit cap) be $100 billion, $140 billion, $135 billion, and the competition is licking their chops, saying 'Boy, this is really great. We can scoop in and get a lot of sales that American companies don't have the financing for'," Hochberg said.
He estimated the bank supported 290,000 U.S. jobs in the last fiscal year, and warned "those are at jeopardy if you do not have financing."
Congressional inaction also would make it harder for the United States to meet Obama's goal of doubling exports by the end of 2014, Hochberg said.
Republican aides in both the House of Representatives and Senate have said they expect the bank to be reauthorized, despite concerns raised by some party members.
Hochberg, whose job takes him all over the world to help promote and finance U.S. exports, said the continued delay worried him because many foreign government are boosting their export-finance operations.
"I lose sleep about getting reauthorized (and) I lose sleep about countries like Brazil and China that are making a very unlevel playing field," he said.
(Additional reporting By Dan Bases; Editing by Philip Barbara)
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