Stop the money machine, we’d like to jump off please. That probably sums up what many taxpayers are hoping will be the result of yesterday’s Senate Banking Committee renomination hearing for Export-Import Bank President and CEO Fred Hochberg. After voting to give a huge lending-capacity boost in Ex-Im’s reauthorization last spring, but also approving legislative language that could lead to better oversight of the taxpayer-backed institution’s practices, cost-conscious Americans expect more than just pleasantries between Hochberg and Committee Members. Although there were some exchanges of hard realities at the hearing, House and Senate Members must ask questions more directly of Ex-Im’s leaders as well as themselves, among them:
1) Since receiving a reauthorization last year that will boost its lending capacity 40 percent between 2012 and 2014 (to $140 billion), what has Ex-Im done to shield taxpayers from future risks? After all, $10 million of the now-bankrupt Solyndra’s funds came from Ex-Im, as did financing for other dubious green energy ventures.
2) Despite claims from Ex-Im’s supporters that the bank has “made a profit,” financial experts have expressed their doubts, noting that Federal Credit Reform Act rules “understate the cost government loan programs impose on taxpayers by excluding, or not factoring in, the cost for market risk.” How far has Ex-Im, not to mention the entire federal government, moved toward the fair-value accounting in its credit programs that House Republicans have been insisting upon?
3) In October 2012, Congressman Jim Jordan (R-OH) contacted Treasury Secretary Geithner requesting an update on the 2012 Ex-Im Reauthorization Act’s requirement that the Secretary negotiate an end to export financing subsidies among other countries and elimination of export aircraft credit financing. How much progress had been made toward these ends since the Secretary’s report was due last November?
4) What has been done to allay concerns of cronyism in the Bank’s leadership? As an op-ed I wrote in December of 2012 recounted: