With all the barriers stacked up against American entrepreneurs, a bright spot has been access to working capital through the Export-Import Bank, which is essential if American exporters are to compete in the global marketplace. Ex-Im provides working capital guarantees, insurance and direct loans to American manufacturers, helping to open new foreign markets that allow the U.S. economy to grow, while creating good-paying jobs.
Yet some in Congress are leaning toward not reauthorizing the Ex-Im Bank. A vote is scheduled for September.
As an independent, self-sustaining agency of the federal government, Ex-Im Bank has an 80-year record of supporting U.S. jobs by financing the exports of American goods and services. By doing so, the Ex-Im Bank has supported 1.2 million private-sector American jobs since 2009. During the past five years, it has earned $2 billion more than the cost of its operations after covering loan loss reserves.
Can you think of another government department that makes more money than it costs the American taxpayer to operate?
As an American exporter, I appreciate the value of the Ex-Im Bank, as do thousands of companies that need a leg-up to compete in foreign markets where U.S. exporters are often sidelined by high tariffs, corruption and the large subsidies foreign manufacturers receive from their governments.
It is hard for me to understand the downside of not reauthorizing the Ex-Im Bank. And I'm not alone. Some 865 companies and business organizations signed a letter calling for Congress to reauthorize the agency. It has become a priority for the U.S. Chamber of Commerce, and with good reason.
Some 60 other nations have their own agencies to help finance exports, so taking funding away from U.S. exporters would give these nations a big advantage.
This doesn't take into account some nations that overtly manipulate their currencies and subsidize exports to make their products artificially cheaper than U.S.-produced products.
Of my company's $180 million in sales, roughly $60 million is derived from exports. We have an Ex-Im loan guarantee for which we pay market rates. This is important to our financial success because U.S. financial institutions will not collateralize foreign receivables or export-bound inventories.
Throughout my career I have been astounded by our banking community's myopic vision when it comes to exports: They place zero value on receivables from the largest and most successful foreign-based companies, while at the same time, provide large credit lines backed by receivables from some of our most unstable domestic companies.
Without the Ex-Im Bank, our export sales would plummet, impacting hundreds of American jobs. And we are just one company.
The American exporter doesn't want handouts. We are willing to pay full freight for whatever we get. But until U.S. banks are willing to finance foreign sales, Ex-Im Bank must stay.
This is even sadder, considering we get next to nothing from our government to promote and support foreign sales, whereas our competitors in Europe and Asia have governments that provide all sorts of resources and incentives to penetrate foreign markets. They fully realize the taxes generated from these sales build their schools, highways and hospitals.
American exporters are already at a tremendous disadvantage. The one thing we have is now threatened to be taken away by the political party that should understand its importance.
I am particularly frustrated that some Republicans have labeled Ex-Im funding as "corporate welfare." It can't be corporate welfare if the bank makes a profit on its loans and returns it to the U.S. Treasury.
I think these Republicans are making a big mistake by alienating the business community, which has historically contributed to the party. This has allowed House Democrats, most of whom support the Ex-Im Bank, to make inroads into big business and gain access to their donation base.
We're letting President Obama off the hook. He has allowed unions to maneuver and dominate his administration's policies (such as the National Labor Relations Board appointments), and at the very time the GOP could be leveraging Obama's anti-growth approach, we're allowing Democrats to create a false narrative that Republicans don't support exports.
I read that the trade group Aerospace Industries Association has issued some ads with the message: "Shutting down the U.S. Ex-Im Bank is good for business and creates thousands of jobs . . . in China, Russia and France." Exactly.
If we want to truly spur our economy and create jobs, the solution is driving more American exports. That means everybody must be pulling the oars in the same direction.
The United States must compete on a level playing field. We must ensure our exporters and entrepreneurs have access to capital. Ex-Im Bank must be reauthorized, to send a strong to message to the business community that we stand with you.
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