WASHINGTON — Export-Import Bank of the U.S. Chairman and President Fred Hochberg is coming to Omaha this week just as the bank's supporters and critics wage a pitched battle over the future of his agency.
Time is running out on the bank, which provides assistance to some U.S. companies that do business overseas. Its charter is set to expire June 30. If Congress fails to act, the bank will be shut down.
A House bill would extend the bank's charter until the end of the 2022 fiscal year and make changes in the way it operates. But it's not clear whether that proposal or an alternative will even be brought up for a vote.
Critics and supporters have been lobbying furiously, running ads attacking or defending the bank in different parts of the country.
Hochberg plans to meet with Nebraska businesses at the
Greater Omaha Chamber of Commerce on Saturday. He is coming to town at the invitation of Rep. Brad Ashford, D-Neb., who supports reauthorizing the bank and thought a visit from Hochberg could help educate the public about the matter.
"It helps Nebraska businesses a lot," Ashford said. "It would not be good for Nebraska at all to just get rid of it. And I don't know why anybody would want to get rid of it. Let's make it better."
The Export-Import Bank provides insurance, loan guarantees and direct loans that facilitate deals between selected American businesses and overseas buyers. The bank fronts the money so that overseas customers can purchase U.S. products.
Backers say it represents a crucial tool in promoting American business, one that helps a variety of operations close big deals that help create jobs.
They say the bank doesn't cost taxpayers anything because it actually makes a profit on the deals.
Critics, on the other hand, describe the bank with phrases such as "crony capitalism" and "corporate welfare." They say it puts the federal government in the business of picking winners and losers, with only a few companies receiving most of the assistance.
Opponents also say that the bank's accounting methods are misleading and that a more stringent approach would show $2 billion in losses over the next 10 years.
Since 2007, the bank has supported at least $247 million in exports from 54 Iowa companies and $841 million in exports from 47 Nebraska companies.
Nebraska's Chief Industries has used the bank for deals worth millions over the years. The bank has helped the Grand Island-based company sell grain silos, conveying systems and other products to foreign buyers.
"We've used it to finance projects in Mexico and also used it in other countries," said Mike Lewis, vice president of operations.
For one thing, the bank provides coverage in markets where private insurers don't exist or the terms aren't competitive on a global basis, he said.
Lewis and other Nebraska business leaders have been spending a lot of time lately talking to the state's congressional delegation about the issue.
Lewis said it's ludicrous that the bank could go away, given what other countries are doing to support their own producers.
"We're the only industrial nation right now that's even talking about taking something like this away," he said.
The issue pits many pro-business interest groups against more ideological organizations pushing to limit the federal government.
The Club for Growth, for example, just announced new ads against the bank in several congressional districts.
"A failed federal agency so riddled with fraud it's been called a petri dish of corruption and graft," the ad says of the bank. "Corporate welfare at its worst."
But Sen. Joni Ernst, R-Iowa, who ran as a proud conservative with the support of groups that oppose the agency, said last week that she favors the bank. She noted that a number of Iowa companies use the agency.
"As long as other countries are offering the same opportunities to their exporters, I do think that it is something we also need to offer to our industries," she said. "This is an important bank for Iowans and our small, midlevel and even some of the larger companies."
Some other lawmakers from Nebraska and Iowa have been less enthusiastic, however.
Rep. Steve King, R-Iowa, said a large chunk of the bank's financing goes to a small percentage of companies. It would be better to focus on small and emerging companies, he said.
"I'm apathetic about its renewal unless we can do that," King said.
The House bill includes changes aimed at managing risks and tamping down opportunities for fraud and corruption.
Republican Sens. Deb Fischer of Nebraska and Chuck Grassley of Iowa said they want to see how far proposed changes go before supporting reauthorization of the bank, as did Reps. Adrian Smith, R-Neb., and David Young, R-Iowa.
Sen. Ben Sasse, R-Neb., declined to comment.
Rep. Jeff Forten berry, R-Neb., supports reauthorization of the bank if it can be improved. He also expressed some exasperation that probank interest groups have been running ads in Nebraska — including one featuring Lewis from Chief Industries — that urge him to vote for it. Fortenberry said he will decide the issue on its merits.
"Look, in a perfect world you wouldn't have an export-import bank, but we don't have a perfect world," Fortenberry said.
He said global trade is neither fair nor free, and it's important to keep the bank in the country's economic arsenal. He said legislation should deal with problems in the bank's management and its accounting methodology, as well as having it focus more on helping small businesses.
"Here you have a financing mechanism that does help certain companies, small and large admittedly, to better compete on the global stage against manufacturers in other countries that have very heavy subsidies or other forms of trade manipulation," Fortenberry said. "So I don't think we should disarm ourselves in that regard, but I think the thing ought to be reformed."