VIDEO: Cantwell Applauds Senate Passage of Export-Import Bank Reauthorization
Legislation heads to President Obama’s desk
WASHINGTON, D.C. – Today, U.S. Senator Maria Cantwell (D-WA) applauded the Senate reauthorization of the Export-Import Bank by a vote of 78 to 20. For months, Cantwell has fought for Congress to reauthorize the bank, which supports 83,000 jobs in Washington state, including sponsoring an amendment to extend it in March. The legislation (HR 2072) passed the House last Wednesday by a 330 to 93 vote.
“We’re very excited that the President has a new tool in his toolbox for America’s economy and for jobs,” said Cantwell, at a press conference held after the vote. “The Bank has supported $41 billion in U.S. exports from over 3,600 U.S. companies, and that was just in 2011. And it supported nearly 290,000 jobs in export related areas. So the Export-Import Bank will continue to operate and will have an increase in its threshold, which will help us carry out an important tool in creating more exports of U.S. products to foreign markets.”
The legislation, now headed to the president’s desk, extends the bank’s charter until 2014. The legislation also increases the bank’s lending authority to $140 billion but only if the bank’s default rate stays below 2 percent, among other requirements. The bank’s historic default rate is about 1.5 percent. The legislation also requires the bank to report its loan default rate to Congress each quarter, creates public comment periods for pending transactions greater than $100 million and commissions a General Accountability Office study to examine the bank’s safeguards against risky loans.
The Export-Import Bank supports 83,000 jobs in Washington state and $66 billion in sales from 172 companies. Of these 172 exporters, 121 were small businesses. Across the nation, the bank’s financing for smaller exporters has risen more than 70 percent the last three years. More than 85 percent of its transactions are with small businesses.
Cantwell has led the charge on the bank’s reauthorization and been among its most vocal supporters.
In early April, she joined local businesses in Spokane, Yakima, Moses Lake and Everett to call for Congress to reauthorize the Export-Import Bank. In March, Cantwell introduced a bipartisan amendment to reauthorize the Export-Import Bank. In February, Cantwell joined Senate Small Business Committee members in urging Senate leadership to move forward on reauthorizing the bank.
If private banks are unwilling, the Export-Import Bank finances or insures the purchase of U.S. goods by foreign customers. The bank’s activities come at no cost to the U.S. taxpayer, because the bank supports itself. The U.S. Treasury has made more than $3 billion off the bank’s activities since 2005.
Earlier today, Senator Cantwell took to the floor of the Senate to speak in favor of the legislation.
Watch a videoof Senator Cantwell’s floor speech.
Her full remarks as delivered are below:
Senator Cantwell: Thank you Mr. President.
I rise today to urge my colleagues in the Senate to pass the Export-Import Bank legislation that is now before us.
This debate this morning is about jobs. It’s about manufacturing jobs and it’s about U.S. manufacturing jobs.
And that is because this bank is one of the most powerful tools we have for manufacturing jobs in America.
It’s a debate about whether this Chamber believes that access to financing is a key tool for US companies to compete on an international basis when they are trying to get US manufactured products overseas.
In Fiscal Year 2011 alone the bank supported nearly 290,000 export created jobs in America. But those are the jobs that are going to be threatened if this Chamber does not act.
That is because this authority expires on May 31st. That’s right, just 16 days from now and between now and then the House is in session for only five days.
So we can’t afford to take this to the brink one more time with amendments passed by the Senate today that really are just amendments that are gutting the Ex-Im Bank.
These five amendments that will be considered, basically would lapse the bank’s authority. And this would put into the debate more uncertainty about our economy.
We need to act now to renew the bank’s charter and businesses can’t wait. They need the planning and certainty to hire more people and failing to act will stifle US economic opportunity.
That’s why nearly two dozen governors, both Democrats and Republicans alike, have urged for the bank’s extension and so have the Chamber of Commerce, The National Association of Manufacturers, and Small Business Associations.
Mr. President, I’d like to enter into the record a chart that is jobs supported by Ex-Im financing by each state. So that members if they like to can come down and look at both the revenue that was generated and the jobs supported.
Mr. President: Without opposition, without objection.
Senator Cantwell: The default rate on the bank is consistently two percent. Lower than most commercial lending. So I’m sure we’ll hear a lot about that debate today. But since 2005 the Export-Import Bank has returned 3.7 billion dollars to the U.S. Treasury. Above and beyond the cost of operation.
So yes my colleagues this is actually something that’s making money for the Federal government. So not only is it helping US manufacturers sell their products overseas, financing in a way that I think is equivalent to what the Small Business Administration does, helps provide a certain level of financing that makes deals come through. I think that’s why you find that banks are supportive of this.
The money goes back to the taxpayer’s pocket. And it supports us winning in a global situation by getting our products sold. So it has been incredibly helpful to our economy. Zero cost to the taxpayers and in fact the nonpartisan Congressional Budget Office concluded that a four year reauthorization of the bank would reduce the deficit by up to 900 million dollars over five years.
So the bank works for businesses, it works for US taxpayers. So there is a compromise that is before us. And I know that it may not be the compromise, I see my colleague from South Carolina on the floor, it may not be the compromise he or I would have written to this legislation but nonetheless it’s a compromise and it’s time to act.
The reason I say that is because so many states also are counting on the Export-Import Bank just like in Washington state.
Pennsylvania for example, has over 1.4 billion dollars in exports and 9,800 jobs related to the Export-Import Bank. Massachusetts, another state, 566 million [dollars]. This is from the annual report of the Ex-Im Bank in 2011. So 566 million dollars of economic revenue generated in Massachusetts and over 4,000 jobs.
Why? Because we helped get Massachusetts exporters access to capital so they could sell their products overseas and win in the international marketplace. Texas, another example. 4.9 billion [dollars] in exports. 35,274 jobs. These are jobs that America needs.
This is a global economy in which America needs to be able to compete. So getting access to capital so that products can be sold is a critically important issue. Florida, another great example of the support of the Ex-Im Bank.
1.1 billion dollars in exports and over 7,643 jobs. So another big winner. The state of North Carolina, 456 million [dollars] in exports and 3,309 jobs. And Ohio, just another example of manufacturers and businesses, another 398 million [dollars] in exports and 2,888 jobs.
So while there are many people who would like to say that this program should be discontinued, if they are not in favor I guess I’m sure some of my colleagues aren’t. Because there are many programs that they would like to get rid of. I would say this is a program that’s good for the US taxpayers.
The Ex-Im Bank generates 3.7 billion dollars for taxpayers since 2005. So, what is this debate about? I would say that the underlying amendments my colleagues are offering are trying to gut the Ex-Im Bank.
They simply don’t like it, want to get rid of it, or say that it is not a viable tool. I guess because one in four jobs in Washington state are based on trade, I know how critically important it is whether you are an agriculture product or your selling airplanes. Whether you’re selling music stands, as one company we saw, or your selling grain silos. You need to be able to compete in an international marketplace and you need to be able to get sales of those products. So this has been a very viable and important tool.
Some of my colleagues have previously raised concerns about the bank’s transparency and oversight. And these concerns have been heard and addressed in this legislation. I’d like to talk about the five ways this new compromise bill addresses those concerns.
There is more oversight. Under the amended bill we would have a quarterly report on its default rate and the first of these reports would be due on September of this year. So the bank has historically maintained a low default rate of less than 2 percent.
But under this provision if the default rate reaches 2 percent or higher the bank will have to develop a plan to fix the problem and report to Congress within one month. And if the default rate stays above 2 percent for more than six months they will be subject to review of an independent auditor.
So these I think are very viable and important additions to the legislation. And not only would the auditor be there to help fix what was going on but would have the oversight for anything that was involved with the bank that they needed to report on.
There’s less risk. Second change to the underlying bill. The government accountability office must study and report back to the bank safeguards that prevent it from taking loans that are too risky. And again, since the bank has had a historically low default rate we’re happy to add this language.
But it just is another layer of protection on something that is performing and performing well. But happy to add that to the legislation.
More public input. The bank will have to open public comment period for transactions greater than 100 million dollars and they’ll have to notify Congress about these transactions. So more transparency on what some consider the bigger financial loans that the bank is involved in.
And fourth, more accountability. There is an annual report that the bank has to justify in the need of every transaction. That way the public will know if the bank has transacted because a private lender would not have or if it acted in response to foreign export credit agencies.
And then fifth, the Treasury must engage nations in discussions about the need for export financing world-wide. Now I know some of my colleagues on the other side of the aisle would hope that the President would just end all export financing and lead that discussion at the World Trade Organization.
I would ask my colleagues what’s the difference between this and the Small Business Administration that provides an opportunity, a bridging of capital between small businesses and the opportunities to join with private financing to make deals happen.
I believe because as I said, I live in a state where we know how beneficial export markets are to our products. Whether they are cherries, whether they are apples, whether they are airplanes, whether they are a variety of new technologies.
These products are winning the day in an international marketplace and their creating jobs. So my colleagues on the other side of the aisle who would like to end this program or to say that it ought to be ended on an international basis, we’re happy to hear what the world community wants to debate and discuss on this basis.
But I will say in the moment of crisis of our financial institutions, when one of the supposedly most risk-averse institutions can’t figure why it lost two billion dollars. And you want small businesses across America to pay the price for the fact that they can’t get financing of their products sold in an international marketplace.
We’ve gotta wake up here and understand that this is about helping small businesses and helping us win the day for products that are created in the United States. Created in the United States and sold abroad. So Mr. President the compromise legislation that is offered here today is the best path forward.
These amendments are an attempt to gut the underlying bill and those who would like to stop the authorization of the bank and have it curtailed because, as I said we only have about five legislative days given the House’s schedule, to get this done.
They would like to tell all those businesses I just mentioned in those states – Ohio, Pennsylvania, Florida, and others – that we don’t know anymore whether this program exists and let’s actually stop the funding and lose jobs.
So, I know there are people like in my state, Larry Stone from SCAFCO, or Bill Perdue from Sonico, they gave me a message that the American people want us to focus on creating jobs and supporting businesses.
They want a program like this to continue and they want the jobs that it creates for their communities.
I thank the President and I yield the floor.
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