Idaho’s economy, both urban and rural, is inextricably tied to our ability to export the products and commodities we produce. Whether it be by our high tech industry, which is the largest Idaho export to the world, or our agricultural products, which help support thousands of jobs.
I strongly believe that Idaho’s farmers and businesses can compete and win on a level playing field and this is where the Export-Import (Ex-Im) Bank plays an important role. 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. 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 Bank has ever done. China alone has provided its exporters with at least $670 billion in export financing over the last two years. To put that in context, the Ex-Im Bank has provided about $590 billion in financing since its inception—81 years ago.
Why would we want to put American companies at a disadvantage against their Chinese competitors? That is exactly what we have done since July 1st, when the charter of the Ex-Im bank expired. Since then, the U.S. has not been able to finance exports, leaving American companies to lose out on business to other countries. With 95% of the world’s consumers living outside the U.S., now is not the time to surrender this important job growing tool.
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. Numerous American businesses have said 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.
For 70 years, the Ex-Im Bank has been reauthorized without issue. In fact, since I have been in Congress the 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 Bank serves as “corporate welfare.” They claim it 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 the Bank’s balance sheet. However, 90% of the service products provided by the Ex-Im Bank are made to support small businesses. From 2009-2014, the 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. 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.