A bank that most Americans have never heard of is at the center of a political stalemate in Washington, D.C., prompting some Minnesota lawmakers and businesses to speak out.
The Export-Import Bank's authority to conduct new business expired on July 1. The 81-year-old bank helps American companies sell goods overseas. It does that by guaranteeing commercial loans made to foreign companies and governments that buy U.S. products.
During much of its history, the bank has operated in obscurity — until now. Some conservatives oppose the bank, arguing it amounts to corporate welfare that primarily benefits major corporations. Supporters, including First District DFL Rep. Tim Walz, say the bank plays a vital role in supporting American businesses.
"It's critical because it's set up to make our export markets on a level playing field with the rest of the world. All the other industrialized nations do this," Walz said.
Last year, the bank supported $27.5 billion worth of U.S. exports and 164,000 jobs. In Minnesota, the bank backed $3 billion worth of exports between 2007 and 2015 that benefited 216 exporters. The bank has a default rate of less than 1 percent and, during the past 20 years, has generated nearly $7 billion.
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Walz is urging colleagues to allow a vote on reauthorizing the bank.
"Let's have the public debate, and I will guarantee you it will get overwhelming bipartisan, Republican-Democratic support. It will sail through, and the president will sign it," Walz said.
One strategy for getting the bank reauthorized involves supporters in the Senate attaching the bank language to an extension of the Highway Trust Fund bill. That's considered a must-pass bill because the trust fund runs out of dollars at the end of July.
Troy Young, a spokesman for 2nd District Republican Rep. John Kline, said the congressman wants to make sure any legislation that passes requires greater oversight of the bank.
"Any legislation should provide greater oversight by ensuring accountability on behalf of the taxpayer by enhancing transparency and reducing risk. Congressman Kline hopes Republicans and Democrats can come together in a bipartisan way to help employers grow jobs in America," Young said.
In 2012, Kline did vote to reauthorize the Export-Import Bank.
Business and labor groups have teamed up to lobby in support of the bank, including the U.S. Chamber of Commerce and the AFL-CIO. Meanwhile, the conservative Heritage Foundation argues its time to get rid of the Depression-era bank. The foundation's president, Jim DeMint, issued a statement on July 1 celebrating the bank's loss of authorization.
"But the fight isn't entirely over. The cronies have their claws deep in Washington, and will do everything to get Congress to reauthorize the Ex-Im charter. Americans should remain vigilant that Congress doesn't try to resurrect this corporate welfare," DeMint said.
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Among the businesses closely watching what's happening in Washington, D.C. is Winona-based Miller Ingenuity . The company makes train parts and sells them to large corporations such as GE and Progress Rail. And while Miller Ingenuity has not used the Export-Import Bank directly, the large companies that buy its products do use it, said Todd Cronin, Miller Ingenuity's vice president of business development.
"Everybody thinks it's a benefit to the giant corporation, but they buy our products. There are lots of small businesses that manufacture parts that go into these major locomotive builders," Cronin said.
In February, Cronin joined other Minnesota business representatives on a trip to Washington, D.C., to urge lawmakers to support reauthorizing the bank. He's kept up the pressure, sending emails and calling members of Congress. He worries if the bank fails to get reauthorized, it will hurt large companies trying to sell expensive trains overseas. That, in turn, could hurt the Winona-based business, that employs about 50 people.
"We're trying to campaign with emails, call senators, get people to talk to representatives," Cronin said. "It's all grassroots."
