President Obama once described it as “little more than a fund for corporate welfare,” but now top Senate Democrats are touting their support for the Export-Import Bank as a way to siphon campaign donations from the GOP.
The New Deal-era agency, which provides low-interest loans to foreign firms to purchase U.S.-produced products, is set to expire in September. Seeking to drive a wedge between big business interests and the GOP, Democrats are lining up to defend the agency.
“I’ve said this to [U.S. Chamber of Commerce President] Tom Donohue and others: In many ways mainstream Democrats are closer to you than many Republicans because the tea party has pulled them so far to the right,” Sen. Chuck Schumer, D-N.Y. told National Journal. “They’re doing what’s harmful to business.”
Top conservatives have pushed for the repeal of the bank, saying it distorts the marketplace by picking winners and losers in the economy. More than 30% of the financing it provides benefits one corporation, The Boeing Company, and more than 60% of its financing benefits just 10 corporations.
In an era of zero and even negative interest rates, critics argue, even these sales would probably attract private-sector financing. It is unlikely there is any real economic benefit arising from the agency’s financing that wouldn’t otherwise occur without the sweetheart deals.
Michael Needham, the CEO of Heritage Action, the Heritage Foundation’s lobbying arm, celebrated the move by Democrats to seize on the issue, saying, “Conservatives should happily let the left stand alone as the party of well-connected elites and special interests.”
Schumer’s pitch to business elites comes as Republicans are evaluating their traditional ties to business. House Financial Services Chairman Rep. Jeb Hensarling (R-TX) in particular has shown a willingness to take on Wall Street, and the Tea Party prompted a conservative backlash against government interference in the economy.