As Congress is currently weighing whether to confirm Fred Hochberg as president of the Export-Import Bank yet again, it is important to look at why U.S. Senators might want to think twice before stamping President Obama’s choice to head up a taxpayer-funded institution that has proven to be little more than an engine for corporate welfare.
When the Ex-Im Bank was reauthorized in 2012, there were specific guidelines that the Bank was supposed to follow in order to ensure it was not hurting American employers. No tangible steps have been taken by Hochberg or his staff that would lead anyone to believe the Ex-Im Bank is on a different path than it was when he took over the Bank in 2009. In fact, there have been prominent examples where the Bank has risked taxpayer dollars with the most glaring example being a $10 million investment in Solyndra in 2011. Additionally, the Ex-Im Bank continues to be “Boeing’s Bank” having never turned down a single Boeing funding request and in fact, in 2012 alone, 82.7 percent of the Bank’s loan guarantees totaling $12.2 billion went to one company, Boeing.
“In 2008, when President Obama was a Senator, he called the Bank ‘little more than a fund for corporate welfare.’ Nothing has changed since then. In fact, the Bank has only gotten larger – in 2012, it received a 40 [percent] increase in its financing authority. This means its ability to distort the free market by handing out huge discounted loans and loan guarantees to special interests has only grown in size.
“Conservatives should oppose Hochberg’s nomination until a real plan is implemented for reducing the Bank’s authority with the ultimate goal of ending its charter completely.”
The truth is fiscally-conscious individuals and conservative groups roundly oppose Hochberg’s confirmation and the Bank’s activities. But they are not alone. As The Club for Growth noted, it was then-Senator Barack Obama who in 2008 said the Ex-Im Bank has “become little more than a fund for corporate welfare.” This is nothing new from Democrats as Former Democratic Governor of Ohio, Ted Strickland, called the bank “corporate welfare” back in 2004 when he served in the U.S. House.
Furthermore, the way the Ex-Im Bank distributes loan guarantees has come under suspicion. In a Washington Free Beacon article in April an Ex-Im spokesman admitted that “the ownership of a company is not relevant to the decision to approve financing.” That comment was made in regard to the Ex-Im Bank financing solar panels made by a Chinese-owned company. That the Ex-Im Bank itself admitted that the ownership of the company is not relevant to approving financing goes to the very core that the Bank is nothing more than a vehicle for corporate welfare.
Fred Hochberg has failed to deliver any new or positive reforms at the Ex-Im Bank, and in fact, he has just kicked the can down the road, while at the same time ignoring the clear will and intent of Congress. He has demonstrated he is not up to the task and should not be afforded a second term as the Bank’s president.
Senators should vote against his confirmation, and instead seek out someone who stops the job-killing giveaways that use taxpayer-backed loans and guarantees to give foreign entities a leg up against American employers.
Stephen DeMaura is the President of Americans for Job Security