Conservatives Turn the GOP Tide Against the Export-Import Bank

The issue of reauthorizing the bank is starting to be seen as a litmus test for Republican leaders in Congress.

WASHINGTON, DC - MARCH 05: U.S. House Republican Conference Chairman Rep. Cathy McMorris Rodgers (R-WA) listens during a briefing March 5, 2014 at the headquarters of the Republican National Committee in Washington, DC. House Republicans briefed members of the media after a closed conference meeting.
National Journal
Billy House
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Billy House
June 24, 2014, 6:24 p.m.

After op­er­at­ing quietly in the shad­ows for eight dec­ades, the Ex­port-Im­port Bank has sud­denly be­come a lit­mus test for Re­pub­lic­ans fa­cing pres­sure from con­ser­vat­ives op­posed to fed­er­al spend­ing for big busi­ness.

Thanks to a shift in po­s­i­tion an­nounced Sunday by in­com­ing House Ma­jor­ity Lead­er Kev­in Mc­Carthy, who said he will op­pose reau­thor­iz­ing the bank after its cur­rent charter ex­pires Sept. 30, the New Deal-era in­sti­tu­tion that provides loans and cred­it in­sur­ance to for­eign buy­ers of Amer­ic­an-made products is at the cen­ter of a heated polit­ic­al de­bate on Cap­it­ol Hill.

The de­bate also pits Re­pub­lic­ans against some of its most power­ful tra­di­tion­al back­ers: The U.S. Cham­ber of Com­merce and the Na­tion­al As­so­ci­ation of Man­u­fac­tur­ers are among groups ur­ging Con­gress to reau­thor­ize the bank, which helped sup­port about $37 bil­lion in ex­port sales dur­ing fisc­al 2013 through loans and cred­it in­sur­ance cost­ing roughly $27 bil­lion.

More than 40 House Re­pub­lic­ans joined in a let­ter to the lead­ers this week sup­port­ing the bank.

But on the oth­er side of the ledger are con­ser­vat­ive groups like Club for Growth and Her­it­age Ac­tion.

“Be­fore it’s al­ways been an in­side-base­ball type of thing — nobody knows about it or cares about it,” said Rep. John Flem­ing. But now, the Louisi­ana Re­pub­lic­an said, jabs at the bank from rising GOP lead­ers, in­clud­ing House Fin­an­cial Ser­vices Com­mit­tee Chair­man Jeb Hensarling, “make this a real light­ning-rod is­sue.”

Not only could Re­pub­lic­an po­s­i­tions on the bank’s con­tin­ued ex­ist­ence play a role in this year’s midterm elec­tions, the GOP lead­er­ship slate in the next Con­gress might well be de­term­ined by how the is­sue plays out in this one.

Two years ago, a bill to reau­thor­ize the bank passed the House 330-93 in a bi­par­tis­an vote. All 183 Demo­crats vot­ing on the bill joined with 147 Re­pub­lic­ans in ap­prov­ing the meas­ure — while 93 Re­pub­lic­ans voted against it. The ap­prov­al came about after Ma­jor­ity Lead­er Eric Can­tor teamed with Minor­ity Whip Steny Hoy­er to push for an­oth­er two-year re­new­al, but the GOP op­pos­i­tion was sig­ni­fic­ant and omin­ous, giv­en that it was com­ing from Hensarling and oth­er rest­less con­ser­vat­ives.

Then came Can­tor’s un­ex­pec­ted primary de­feat on June 10 and his de­cision to step aside as ma­jor­ity lead­er at the end of Ju­ly. Hensarling was de­scribed by col­leagues as already pre­par­ing for a show­down with Can­tor over the Ex­port-Im­port Bank’s reau­thor­iz­a­tion, but the change in lead­er­ship ap­proved by House Re­pub­lic­ans last week moved the is­sue to the front burn­er.

Hensarling’s com­mit­tee has sched­uled a hear­ing Wed­nes­day titled “Ex­amin­ing Reau­thor­iz­a­tion of the Ex­port-Im­port Bank: Cor­por­ate Ne­ces­sity or Cor­por­ate Wel­fare?”

Oth­er con­ser­vat­ives have already been build­ing to­ward a bank shut­down. Sen. Mike Lee of Utah earli­er this year laid out this op­pos­i­tion in a Na­tion­al Re­view piece head­lined, “Ex-Im Bank and the GOP’s Cronyism Test.” Lee called the is­sue a key test for con­gres­sion­al Re­pub­lic­ans.

Against this back­drop, Mc­Carthy an­nounced Sunday a shift in his own po­s­i­tion on the bank, when he said he in­ten­ded to vote to let it close. The in­com­ing ma­jor­ity lead­er had voted for its reau­thor­iz­a­tion two years ago.

On Tues­day, Speak­er John Boehner, him­self a past sup­port­er, de­clined to say wheth­er he be­lieved the bank’s charter should be re­newed.

Per­haps more sur­pris­ing, GOP Con­fer­ence Chair­wo­man Cathy Mc­Mor­ris Rodgers — who also voted to reau­thor­ize the bank in 2012 — got an ed­it­or­i­al tongue-lash­ing this week from a ma­jor ho­met­own news­pa­per sup­port­ing the bank for what it de­scribed as her evas­ive an­swers on the top­ic.

Mc­Mor­ris Rodgers was asked about the is­sue by The Spokes­man-Re­view of Spokane, and the news­pa­per re­por­ted Tues­day that the House’s No. 4 Re­pub­lic­an wouldn’t com­mit to sup­port­ing a reau­thor­iz­a­tion again. In­stead, she told the pa­per she sup­ports “a way for­ward for Wash­ing­ton [state] ex­ports, while at the same time pro­tect­ing tax­pay­er dol­lars.”

“That’s a weak re­sponse when thou­sands of Wash­ing­ton jobs, many in her dis­trict, de­pend on the bank,” the news­pa­per said. “The en­tire Wash­ing­ton del­eg­a­tion backed the bank two years ago, and a stronger push is needed now,” the ed­it­or­i­al said, not­ing that Boe­ing, Gen­er­al Elec­tric, and Cater­pil­lar are some of its biggest be­ne­fi­ciar­ies.

The news­pa­per then went so far as to note that Mc­Mor­ris Rodgers — al­though she comes from the na­tion’s “most trade-de­pend­ent state” — has much to fear from Hensarling and “his tea-party col­leagues.”

In fact, Hensarling, a con­ser­vat­ive darling who passed on the chance to chal­lenge Mc­Carthy in last Thursday’s spe­cial elec­tion for ma­jor­ity lead­er, is seen by many as in­stead pre­par­ing a run for one of the two top GOP lead­er­ship po­s­i­tions in the next Con­gress.

But an­oth­er Re­pub­lic­an who sup­ports re­new­ing the bank’s charter, Rep. Tom Cole of Ok­lahoma, said the ques­tion for him is not so much the im­pact on the GOP lead­er­ship ranks. Rather, he said, it is wheth­er Hensarling will al­low a vote in his com­mit­tee. And if so, Cole asked, will the bill go to the floor so the en­tire House can weigh in?

“Po­ten­tially thou­sands of jobs” are at stake, Cole said.

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