President Donald Trump said Friday he'll nominate a critic of the U.S. Export-Import Bank — one who has derided the bank as “corporate welfare” — to run the institution, which has been operating under strict lending limits because of a partisan battle over its mission.
Trump, who as a candidate said he didn't think the bank needed to exist, named former New Jersey Rep. Scott Garrett, one of the biggest recipients of Wall Street donations among House members, to be the bank's chairman and president. He tapped former Alabama Rep. Spencer Bachus for a seat on the bank's board of directors. Both positions require Senate confirmation.
Trump hinted at a shift in his position on Ex-Im during an interview on April 12. “Actually, it's a very good thing. And it actually makes money; it can make a lot of money,” Trump told the Wall Street Journal. “It turns out that, first of all, lots of small companies are really helped, the vendor companies.”
In 2015, Trump told Bloomberg that the bank's role amounted to “featherbedding” for some politicians and companies. The guarantees loans for international buyers of products from U.S. companies.
Boeing CEO Dennis Muilenburg is said to have helped change the president's view of the agency. Boeing is by far the largest beneficiary of the bank among exporters, to the tune of several billion dollars annually, followed by General Electric.
Small-government conservatives shut down the bank in 2015 by blocking its reauthorization. While the bank was revived, its five-member board has lacked a quorum, which restricted it from granting loans of more than $10 million. Former President Barack Obama's late-term nominees were blocked by Senate Republicans, including Sen. Richard Shelby of Alabama.
In Garrett, Trump has chosen a critic of a government agency to run it, similar to his appointment of Scott Pruitt as administrator of the Environmental Protection Agency.
“The Export-Import Bank's long legacy of crony capitalism has hurt the livelihoods and businesses of many Americans who don't get special treatment from this misguided government program,” Garrett said in a 2015 statement. Conservative groups, including Heritage Action and Americans for Prosperity, oppose the bank for similar reasons.
House Minority Whip Steny Hoyer, a Maryland Democrat, urged senators to reject Garrett's nomination because of his past stance.
'Act of Sabotage'
“In Scott Garrett, the president has nominated someone who helped lead the charge to shut down the Export-Import Bank in Congress against a super-majority that was in favor of keeping it open so it could continue creating and supporting American jobs and exports,” Hoyer said in a statement. “If former Representative Garrett is confirmed to lead the Bank, it would be the ultimate act of sabotage.”
Garrett, 57, failed to win re-election in 2016 after seven terms in Congress. He lost the backing of major Wall Street donors after a report that he'd told fellow Republican lawmakers he wouldn't give money to the party's congressional campaign arm because it supported openly gay candidates.
Bachus, a former chairman of the House Financial Services Committee, has previously supported the Ex-Im bank, sponsoring a 2012 law that reauthorized the bank. Bachus retired from Congress in 2015.
Backers of the bank say that most of its lending supports small and medium-sized businesses.
In fiscal 2014, the bank's last full year of operation, it backed $27.5 billion in exports — somewhat less than 2% of the U.S. total. This financing supported 164,000 American jobs that year, according to the bank, and about 90% of the bank's deals helped small businesses.
The U.S. Chamber of Commerce has pushed for the bank's lending powers to be fully restored, saying that without it, jobs might be lost to competitors in China or Russia.
Bloomberg News
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