Top Republican Ensures Job Losses for US Exporters

Almost every week, these days, we seem to find more and more examples of Republicans in post-policy mode – with no serious policy solutions, they seem to have chosen to simply make sure government does not work. Today’s example involves the ever-cantankerous Richard Shelby and the Export-Import (Ex-Im) Bank. The bank was set up in the depths of the Depression in order to help facilitate US exports.  It essentially acts like a corporation, offering financing and insurance for foreign purchases of US-made goods by customers unable or unwilling to take on that credit risk. With its help, it is much easier for US companies to expand into riskier overseas markets and the US companies that benefit from this range from the smallest to the largest of US businesses. The bank was such a success for the US that 60 other countries have now set up similar banks to help increase their exports.

Now you would think that Republicans would be supportive of an organization that is helping drive US exports, but, with today’s Republican party, you would be wrong. Last June, Republicans decided that the bank was just another example of crony capitalism and corporate welfare and the mere fact of making these loans meant government was picking winners and losers. Although large US businesses are just a small fraction of the clients the banks serves, the dollar value of loans for those large businesses are the majority of the bank’s portfolio. There were also some concerns about the government’s credit risk in making these loans, despite that never being a problem in the past. So they voted not to renew the bank’s charter, essentially shutting it down.  After some significant backlash from the business community, some common sense prevailed and the bank’s charter was renewed over the objections of tea-party Republicans.

After a six month hiatus, the bank was finally back in business but approval was needed by the bank’s five-member board for any loan over $10 million. At the time of the bank’s charter renewal there were only two members on the board – the others were waiting for Senate confirmation like so many Obama appointees. And this is where Richard Shelby comes in. As chairman of the Senate Banking Committee he has personally put a hold on any of Obama’s nominees to the board of the bank. And without at least three board member, there can be no quorum and no way to expedite loans of over $10 million dollars. For a year now, no loan of over $10 million dollars has been approved.  There were indications that Mr. Shelby might relent after a strong primary challenge from his right ended in March. But that didn’t happen and over 30 deals worth more than $20 billion are just sitting in limbo right now.

With no US Ex-Im Bank loans available, companies have gone to other countries banks in order to move their projects along.  But often those loans come with strings attached requiring some investment in that foreign country. For example, GE alone has moved some of it manufacturing plants from South Carolina, Maine, New York, Texas, and Wisconsin to overseas plants in order to facilitate financing through other countries’ banks. Not only have these moves cost thousands of jobs for GE workers but the negative effects on local suppliers to those plants have also been hit.

This is today’s Republican party. Thousands of Americans must lose their jobs because they can’t allow that a government program might actually help big business. Millions must not get health care because that would show a government program could work. How long will so many Americans have to suffer just because Republicans can’t stand government?