Locked in a high-stakes battle for the survival of the Export-Import (Ex-Im) Bank, chief Fred Hochberg is defending the institution’s involvement with Boeing amid criticism that it serves as “corporate welfare” for the aviation titan and other big companies.
Conservative groups and lawmakers, looking to put the bank out of business, are lining up against a proposal to reauthorize its charter before it expires at the end of June. The 80-year-old bank, which traditionally enjoyed bipartisan support within Congress, has become a punching bag for critics in the Tea Party, who attack Ex-Im as an example of “cronyism” and have nicknamed it the “Bank of Boeing.”
{mosads}Asked during an interview with The Hill whether the nickname is unfair, Hochberg snapped, “Yes, of course it is.”
“Do we want those jobs to be in the state of Washington and South Carolina and the 15,000 companies in the supply chain of Boeing?” the Ex-Im president asked. “Or do we want them to be in Toulouse and Hamburg and the Airbus supply chain overseas? That’s the choice we have. … We have an obligation not to turn our backs on American workers.”
The bank provides loans, insurance and guarantees to support U.S. exporters. Standard & Poor’s Ratings Services estimated in 2014 that Boeing received more than one-third of the bank’s total loan commitments between 2007 and 2013.
Delta Airlines has used the Ex-Im reauthorization fight to lobby for changes at the bank, arguing that its financing unfairly benefits Boeing while undercutting competitors, a charge Boeing and the bank deny.
As the battle over Ex-Im approaches a critical moment, Hochberg is making his case to keep the bank from closing.
Last week, he hosted more than 1,200 people at the organization’s annual two-day meeting in Washington, D.C. Among those in attendance were exporters from more than 30 countries and top administration officials, including national security adviser Susan Rice and Commerce Secretary Penny Pritzker.
Hochberg will be in Omaha, Neb., this week to meet with business leaders. He frequently crisscrosses the country, meeting with state and local business and political leaders to discuss the bank.
Last month, he was in Oklahoma. In February, he traveled through Des Moines, Iowa; Detroit; and Perrysburg, Ohio.
Along the way, Hochberg is meeting with U.S. businesses and local politicians to discuss the bank, raising questions among some critics about whether it’s appropriate for him to be openly campaigning for Ex-Im’s survival.
“If asked, most Americans would say a high-ranking federal bureaucrat shouldn’t be flying around the country to defend and promote corporate welfare,” said Dan Holler, spokesman for Heritage Action, one of the most ardent critics of the bank. “Yet, that is exactly what Hochberg is doing. It doesn’t really pass the smell test.”
Hochberg bristled at the notion.
“I’ve been in this job for six years. I travel around the country all the time,” he said. “My job is to meet with U.S. exporters and help spur them on.”
Since 2011, the bank has held nearly 80 “global access” forums across the U.S., partnering with the U.S. Small Business Administration and the Commerce Department to hold seminars on federal resources available to small-business exporters, bank officials said.
Hochberg said the efforts are necessary to ensure that U.S. exports don’t include jobs to “places like Western Europe, China, Asia and Japan.”
“That’s the choice America has to make,” he said. “That’s the choice members of Congress have to think about.”
Republicans are sharply divided on whether to renew the bank’s charter. Potential 2016 presidential contenders, such as former Florida Gov. Jeb Bush and Wisconsin Gov. Scott Walker, along with already declared candidates, including Sen. Marco Rubio (R-Fla.), oppose the bank.
In Congress, Rep. Paul Ryan (R-Wis.) opposes reauthorizing the bank, as does House Financial Services Committee Chairman Jeb Hensarling (R-Texas), whose panel can control the movement of a bill to renew the Ex-Im charter.
Panel spokesman Jeff Emerson said, “Hensarling believes we shouldn’t be giving foreign aid to companies who agree to buy products principally from Fortune 50 companies with the best political connections.”
House leadership hasn’t said whether they would bypass Hensarling and move a bill to the floor. Hochberg said he hasn’t met with Hensarling this Congress, but he has met with staffers in Speaker John Boehner’s (R-Ohio) office.
Senate leaders have said they’ll move a bill introduced by Sens. Heidi Heitkamp (D-N.D.) and Mark Kirk (R-Ill.) before June 30. The bill includes provisions that would roll back the bank’s restrictions on financing projects at coal-fired power plants.
Similar provisions are included in the House reauthorization bill sponsored by Rep. Stephen Fincher (R-Tenn.). Environmentalists vocally oppose the provisions, which are championed by the coal industry.
“I’m going to let them have that debate, but the president made that very clear,” Hochberg said. “We should not be using government resources to be backing coal-powered fire plants, except in the poorest countries.
“They have less options, and they’re going to put up coal-fired power plants, and we want to make sure we’re in that game,” Hochberg said.
Top business groups, including the Chamber of Commerce and the National Association of Manufacturers, are throwing their weight behind the bank’s reauthorization.
Meanwhile, Tea Party groups, including Heritage Action and Freedom Partners are working to rally support against the bank.
That dynamic has splintered Republicans; Democrats remain largely supportive of the bank.
Hochberg said he’s surprised at how controversial the reauthorization — once a nonpartisan vote in Congress — has become inside the Beltway.
“It does surprise me,” Hochberg said. “Especially since we’re supporting all of these jobs.”