General Electric announced on Monday that it is closing its long-time Waukesha, Wisconsin plant and moving the operation to a yet-to-be-named and yet-to-be-built facility in Canada because Congress hasn’t reauthorized the controversial Export-Import Bank. The Ex-Im Bank, as it’s called for short, is backed by the federal government and previously underwrote business deals for large American corporations. The bank’s charter expired at the end of June and Republicans skeptical of providing welfare to corporations have prevented its reauthorization.
Although GE was quick to blame Congress and the demise of the Ex-Im Bank for its decision, this isn’t the first time GE has made a controversial decision and blamed it other factors.
State [mc_name name=’Rep. Robert Scott (D-VA)’ chamber=’house’ mcid=’S000185′ ] Allen (R) claimed in a press statement first reported by Waukesha blogger James Wigderson and later covered by RightWisconsin that he was contacted by a GE official and asked if he would help the company use the announcement for political purposes. According to Allen:
“In a press release, and substantiated by my conversation with GE corporate spokesperson, Patrick Theisen, this afternoon, GE wishes to blame the problem on the House of Representatives and that body’s failure to act on the U.S. Export Import Bank. Mr. Theisen was eager to connect me with his public relations department to help me gin up a press release blaming Congress and demanding they act. In the same conversation, practically in the same breath, he told me that the decision on the Waukesha plant was made some time ago and that it was irreversible.”
Theisen’s claim to Allen that GE made the decision to shut down the facility long before the Ex-Im fight directly contradicts what GE Vice Chairman John Rice said of the closing: “We believe in American manufacturing, but our customers in many cases require Export Credit Agencies financing for us to bid on projects. Without it, we cannot compete, and our customers may be forced to select other providers.”
Predictably, the Milwaukee Journal Sentinel in a story written by reporters Rick Barrett and Craig Gilbert dutifully regurgitated GE’s claims without critical examination. The pair pointed out that GOP Congressman [mc_name name=’Rep. Paul Ryan (R-WI)’ chamber=’house’ mcid=’R000570′ ], whose district includes portions of Waukesha County, opposed reauthorizing the Ex-Im Bank, and quoted Democratic [mc_name name=’Sen. Tammy Baldwin (D-WI)’ chamber=’senate’ mcid=’B001230′ ]’s comments lamenting the demise of the taxpayer-funded agency. Not once did Barrett or Gilbert mention GE’s moment of candor while interacting with state [mc_name name=’Rep. Rick Allen (R-GA)’ chamber=’house’ mcid=’A000372′ ].
CBC News, a Canadian news outlet, noted that GE hasn’t yet built a Canadian facility to handle the manufacturing that is leaving Waukesha. “GE said it will invest $265 million in a new state-of-the-art manufacturing plant in Canada to make large piston engines generally used for compression, mechanical drive and power generation applications,” the outlet reported. Fascinatingly, when CBC News asked GE for details about this new facility, “GE Canada said there was no further information regarding the location or the process it will use to determine where the plant is located.”
The Washington Examiner reports that a September 15 GE announcement that it will create 400 jobs in France, something it began work on in May 2014 when GE CEO Jeffery Immelt announced plans to expand corporate operations in Europe, was said by the company to be the result of the Ex-Im Bank’s expiration. If the Ex-Im Bank expired in June 2015, then a plan that was devised in May 2014 couldn’t be the result of anything that happened more than a year later.
The Washington Free Beacon on Monday reported that GE had similarly said that 1,000 new UK jobs were the result of Ex-Im expiration even though another GE official told Reuters that, “it was unlikely that GE would have made the investments in the United States even if Ex-Im had been operating.”
Jobs at GE facilities in Texas are headed for Hungary and China in 2016, moves that are also being blamed by GE officials on the Ex-Im tussle.
GE can’t keep its story straight because the jobs it is moving to Canada, France, China, Hungary or the UK aren’t about the Ex-Im Bank, but are about business decisions made long before the bank’s June 30 expiration. GE is simply trying to – cleverly – use current corporate operations to pressure members of Congress into supporting a favored source of corporate welfare.
So far, GE has successfully gotten Democratic U.S. Senate candidate, and long-time former Sen. Russ Feingold (WI), and [mc_name name=’Sen. Tammy Baldwin (D-WI)’ chamber=’senate’ mcid=’B001230′ ] (WI) to carry its water. “Over the years, [mc_name name=’Sen. Ron Johnson (R-WI)’ chamber=’senate’ mcid=’J000293′ ] [R-WI] has helped turn the non-controversial reauthorization of the Export-Import Bank into a game of political brinkmanship, which today proved it has no winners,” Feingold said in a statement. For her part, Sen. Baldwin chimed, “The Republican majority in the House needs to do what the Senate did nearly two months ago and take action on the Export-Import Bank before more Wisconsin jobs are lost to other countries.”
In 2011, GE moved the headquarters of its medical imaging arm to Beijing, China. Previously, the company’s medical imaging headquarters was located in Waukesha, Wisconsin. The cited reason for the move wasn’t financing for products or development, but geographic location close to a growing consumer base.
GE CEO Jeffery Immelt has skillfully contributed to both sides of the political aisle, and in January 2011 he was named chairman of President Barack Obama’s (D) Council on Jobs and Competitiveness. In April of 2014, Immelt blamed ObamaCare for GE Healthcare’s decline in profitability, even though ObamaCare was enacted in 2009 and Mr. Immelt accepted a high-profile role with the Obama administration in the years that followed. None of these facts were mentioned by the Milwaukee Journal Sentinel even though it cited sources who blamed Republicans for GE’s decision.