Simpson Votes to Support Idaho Farms and Business
House Reforms and Reauthorizes Ex-Im Bank to Protect Taxpayers and American Companies
Washington- Idaho Congressman Mike Simpson today supported passage of H.R. 597, the Reform Exports and Expand the American Economy Act. This legislation reauthorizes the Export-Import (Ex-Im) Bank through 2019, while making key reforms to limit taxpayers’ liability and increase the Bank’s focus on small businesses. The Ex-Im Bank is the official export credit agency of the U.S., with a mission to finance and promote exports of U.S. manufactured goods and services. H.R. 597 passed by a vote of 313-118.
“I strongly believe that Idaho’s farmers and businesses can compete and win on a level playing field,” said Simpson. “Why would we want to put American companies at a disadvantage against their foreign competitors? That is exactly what has occurred since the Bank’s charter expired on July 1st. Since then, the U.S. has not been able to finance exports, leaving American companies to lose out on business to their foreign competitors.”
More than 80% of trade worldwide requires financing, and most countries that we trade with have established export credit agencies, which often support their companies much more generously than the Ex-Im Bank has ever done. China alone has provided its exporters with at least $670 billion in export financing over the last two years. In comparison, the Ex-Im Bank has provided about $590 billion in financing since its inception—81 years ago.
“Numerous American businesses have told me that allowing the Ex-Im Bank to expire would be tantamount to unilateral trade disarmament, conceding billions of dollars in orders to other nations that maintain their own export credit agencies,” said Simpson.
According to the Nuclear Energy Institute, U.S. nuclear energy suppliers compete against international rivals that are supported by their governments, and the availability of export credit agency support is almost always a bidding requirement for nuclear power plant tenders.
“For 70 years, the Ex-Im Bank has been reauthorized without issue,” said Simpson. “In fact, since I have been in Congress, the Ex-Im Bank has been brought up for reauthorization 25 times and has passed with overwhelming support, including mine, each time. However, many are now arguing that the Ex-Im Bank serves as “corporate welfare,” puts taxpayers at risk, and only benefits big businesses. This cannot be further from the truth.”
Last year, fees and interest collected by the Bank brought in a total $675 million to the U.S. Treasury. The Bank itself has credit assessment procedures that are more rigorous than commercial banks and, as of March 2015, a historical default rate of below 1%. Large companies do use the Ex-Im Bank to finance exports and make up 40% of its balance sheet. However, 90% of the service products provided by the Bank are made to support small businesses. From 2009-2014, the Ex-Im Bank has supported $169 million in exports from Idaho, with 71% of support going to small businesses.
“The economic growth of our state depends on the ability of our high tech and manufacturing sectors to ship their products globally, and I will not support threatening the competitiveness of these American companies by dismantling the Ex-Im Bank,” said Simpson. “Not only does the Bank level the playing field, but it also supports job growth, capital investment and helps reduce the national debt. It is a win-win for Idaho.”