These days, it seems like everyone has an opinion on the U.S. Export-Import Bank.
On Sunday, former president Bill Clinton became the latest political insider to weigh in on the embattled 80-year-old federal credit agency, which seeks to support American businesses by providing financial assistance to their foreign customers. The bank is facing an uncertain future as Congress mulls whether to reauthorize its charter, due to expire in September.
Speaking in an interview on NBC's "Meet the Press," Clinton defended the bank, joining a chorus of Democrats, some Republicans and powerful corporations who claim the bank provides a necessary boost for American businesses both large and small. These defenders are butting heads with tea party and other conservative critics, who are campaigning to shut down the bank that they say hands out welfare to some of the world’s largest corporations.
Here are some of the companies and industries with the most to lose if the bank closes its doors:
In financial terms, the bank’s closure could come as a significant hit for some of America’s largest corporations, who fear that they will lose global market share if the bank is no longer there to help them. Medium- and large-sized companies benefited from 81 percent of the dollar volume of the financing provided by the bank in fiscal year 2013, according to the bank’s 2013 annual report.
The breakdown is even starker at the top of the pyramid. The top 10 entries in the bank’s list of exporters — eight corporations and two entries for “unknown” and “various” companies — benefited from 76 percent of the financial assistance provided by the bank that fiscal year, according to a report by the Mercatus Center at George Mason University. That report was authored by Veronique de Rugy, a senior research fellow at the center and a critic of the bank.
“Policy-wise, there’s no justification for the Ex-Im Bank,” de Rugy said in an interview. “It’s been benefiting the same companies for a very long time, and I think it’s about the time to end it.” The aviation industry
The aviation industry may have reason to worry about the bank’s future. In the 2013 fiscal year, the bank provided $8.3 billion in financing to back the aviation-related manufacturing sector in dealings abroad, second only to the manufacturing sector (a category that excludes commercial aircraft), according to the bank's 2013 annual report.
It’s clear that, across all industries, the Chicago-based Boeing Co. benefits the most from the bank’s help. In fiscal year 2013, the company benefited from at least $8.3 billion in backing from the bank — about 30 percent of the bank's total financial assistance provided that year, according to the Mercatus Center report. The bank’s Web site also lists Boeing as its top-financed exporter in each year since 2007.
Boeing may already be feeling the effects of the uncertainty over the bank’s future. The company’s stock is down 3.7 percent since new House Majority Leader Kevin McCarthy (R-Calif.) said on June 22 that he does not support the agency’s reauthorization.
With the bank under pressure, Boeing has emerged as a quiet but determined defender. The company has actively solicited small businesses to share their positive stories about working with the bank, a Boeing spokesperson confirmed.
Another company in the industry with much to lose is Atlas Air Inc., a cargo aircraft operator based in Purchase, N.Y. Atlas was the bank’s second-top-financed beneficiary in the 2013 fiscal year, according to figures on the bank’s Web site. Bonnie Rodney, a spokesperson for Atlas Air, declined to comment on how much Ex-Im Bank-backing her company benefited from that year.
Conglomerates that export a variety of goods and services
Beyond the aviation industry, several large corporations that manufacture and sell a wide array of products are also big beneficiaries of the Ex-Im Bank.
Connecticut-based General Electric Co. was given at least $2.6 billion in backing from the bank in fiscal year 2013 -- about 10 percent of the loans, guarantees and insurancethat the bank provided that year, according to the Mercatus Center report.
During that same period, Peoria, Ill.-based Caterpillar Inc. benefited from at least $1.3 billion in bank financing for its oil and gas, transportation and infrastructure, mining and manufacturing exports. That figure is about 5 percent of the bank's total allocated financial assistance in the 2013 fiscal year, the report indicated.
Both companies are concerned about what the bank’s closure could mean for their international business. GE has called small businesses soliciting stories about their positive experiences with the bank on behalf of the Ex-Im Coalition, a campaign organized by a number of the bank’s defenders. And Caterpillar is leading an aggressive lobbying campaign to keep the bank alive, the Wall Street Journal reported.
They may have reason to worry: GE and Caterpillar have seen their stock prices drop by 2.6 percent and 0.6 percent, respectively, since McCarthy spoke out against the bank.
Small businesses and companies
It’s not just large corporations and profitable industries that have stakes in the Ex-Im debate. Small businesses benefited from nearly 90 percent of the total number of authorizations in fiscal year 2013, representing a record 19 percent of the dollar volume allocated by the bank that year.
Worried about what the bank’s closure could mean for them, many small businesses have been advocating for reauthorization. Some have sent letters to their representatives in Congress, and a total of 865 companies and industry groups, including many small businesses, signed a letter last week urging lawmakers to renew the bank.
Rastelli Foods Group, a privately-owned company that exports food products to more than 80 foreign buyers, is also closely watching the debate over the bank’s future. The New Jersey-based company, which has turned to the bank for trade insurance for the past decade, is listed on the bank’s Web site as its number two financed exporter since 2007.
Paul Zaun, Rastelli’s chief financial officer, declined to provide information about much bank funding his company has benefited from in recent years. However, he said in an e-mail, “If their charter is not renewed, we will be scrambling to find trade insurance that is as flexible and easy to manage as that provided by Exim Bank.”