The government's vehicle for promoting U.S. export sales survived a challenge from conservatives Tuesday with a Senate vote to renew the charter of the Export-Import Bank for three years. The vote, coming after the Senate rejected amendments to weaken or kill the bank, sends the measure to President Barack Obama for his signature.
The bill, which passed the House last week, also raises the independent federal agency's lending cap from the current $100 billion to $140 billion. The vote was 78-20.
The bank, which has been renewed several dozen times with little notice since it was established in 1934, became caught this year between business groups that strongly support it and conservative organizations, such as Club for Growth, that said the bank is market-distorting and should be abolished. Obama has pushed for its renewal, saying it is key to his job-promoting goal of doubling exports over a five-year period.
A side issue has been the split between supporters of Boeing Co., the Ex-Im Bank's largest beneficiary, and Delta Air Lines, which has claimed that its bottom line has been hurt because its foreign competitors, such as Air India, have used Ex-Im financing to buy Boeing's newest aircraft.
Without congressional action, the bank's charter would have expired at the end of this month. It is also close to going over its lending cap.
Obama said in a statement following the Senate vote that reauthorization of the Ex-Im Bank will help businesses create jobs at home and sell products abroad without cost to taxpayers.
"Congress should continue to do the right thing by acting on proposals we know will grow our economy and create jobs. In the meantime, I look forward to signing this bill into law," Obama said.
The vote, said the bank's chairman and president Fred Hochberg, most importantly "gives our exporters a clear signal that we are there for them and that they will have a reliable Ex-Im Bank."
The bank, which takes no money from taxpayers, last year provided export-financing support for about 2 percent of U.S. exports, about $32 billion in loans, loan guarantees and credit financing. Some $11 billion of that supported Boeing sales of large commercial aircrafts.
Countering critics who say it is "Boeing's bank," the bank says that 87 percent of its transactions last year directly benefited small businesses and that its financing supported 290,000 jobs, including 85,000 in the aerospace industry.
"Failure to reauthorize the Ex-Im would amount to unilateral disarmament and cost tens of thousands of American jobs," the U.S. Chamber of Commerce said in a letter to senators, noting that last year Chinese export credit agencies provided almost 10 times more financial backing than the Ex-Im Bank did.
"This bank is one of the most powerful tools that we have for manufacturing jobs in America," said Democratic Sen. Maria Cantwell of Washington, home to many Boeing facilities.
But conservatives argued that the government should stay out of the marketplace. "We're in a bidding war with China and Europe to see who can subsidize the most loans at a time when all of us are broke," said Sen. Jim DeMint, R-S.C. "We need to bring this to a close."
Among the amendments defeated before the Senate passed the bill was one by Sen. Mike Lee, R-Utah, that would have terminated the bank after a year.
Earlier this month House Majority Leader Eric Cantor, R-Va., and Democratic whip Steny Hoyer of Maryland reached a compromise that answered some conservative concerns. In addition to renewing the bank for three years, it requires greater transparency in the bank's dealings, a Republican priority, requires the bank to keep its default rate under 2 percent and directs the bank to make clear that loans are needed for such reasons as assuming risks the private sector won't undertake or meeting competition from foreign export credit agencies.
The compromise also addresses the Boeing-Delta dispute by directing the treasury secretary to initiate multilateral negotiations on reducing and eventually eliminating government export subsidies for aircraft and ultimately ending all government export subsidies.
It passed the House last week on a 330-93 vote, with all no votes coming from Republicans.