The Honorable Fred Hochberg, chairman and president of the Export-Import Bank of the United States (Ex-Im Bank), is set to testify before the U.S. Senate Committee on Banking, Housing and Urban Affairs on January 28th.
The topic of the hearing will be the “Oversight and Reauthorization of the Export-Import Bank of the United States,” which should make for quite interesting conversation considering Hochberg should be peppered with questions concerning the Bank’s undermining of American taxpayers and employers at every turn during his tenure.
The Export-Import Bank is a federal agency, backed by the faith and credit of the American taxpayer, which was originally created in 1934 by President Franklin Delano Roosevelt to promote American products in foreign countries by providing loans, so that foreign companies could purchase American goods and products. Today, the Bank serves as a corporate welfare machine, handing out subsidies in the form of financial guarantees and favorable loan terms, constantly threatening the welfare of American industries and the workers they employ.
The Export-Import Bank has engaged in a litany of business deals that are demonstrative of its failure to take into account – as required by law – the impact its reckless actions have on American jobs.
Just recently, the Bank financed Roy Hill, an iron ore company owned by the richest woman in Australia to the tune of $650 million. The catch is that this loan, like many of Ex-Im’s other loans, is available exclusively to foreign companies purchasing American goods with the loans being offered at a sub-market rate oftentimes undercutting private lenders from the marketplace.
As a result, American companies have to pay more than their foreign competitors for goods and equipment placing them at a distinct competitive disadvantage. In this particular case, the American iron ore industry will see $600 million of iron ore exports displaced, all because of a transaction that was largely financed by the United States Government. The Roy Hill deal was so blatantly bad for American workers, Democratic Senators who previously supported both the Bank’s re-authorization and Hochberg’s nomination spoke out denouncing it joining their friends on the other side of the aisle.
Sadly, this hasn’t happened on just one occasion. It is a troubling trend that has grown under Hochberg’s watch. The most consistent and outrageous example of the Bank’s ignominious subversion of American employers takes place in the airline industry. Hochberg has failed to diversify Ex-Im’s subsidies sending roughly 82 percent of Ex-Im’s total portfolio to foreign companies purchasing Boeing airplanes.