What’s at stake?
According to the bank, more than 30 deals worth a collective $20 billion have been put on pause because the board currently cannot review any proposal worth more than $10 million due to the administrative problem regarding a quorum of board members. A bank spokesman did not provide a more specific breakdown of which companies those deals involve, or each deal’s individual value, saying those details are confidential.
In 2015, during the nine months it operated with full authority, the bank approved 2,600 deals totaling $12.4 billion. In 2014, it approved 3,410 deals totaling $27.3 billion.
The heart of the problem is that the bank is supposed to have a five-member board of directors, but only two of the slots are currently filled. A third is needed to reach quorum to review deals over $10 million. President Obama in January nominated J. Mark McWatters, but the nomination must be approved by the Senate Senate Banking Chairman Richard Shelby (R-Ala.) has halted the process.
The Obama administration and supporters of the bank — including the Chamber, National Association of Manufacturers, Boeing and General Electric — want Congress to essentially eliminate the quorum requirement. They were hoping it would happen in the stop-gap spending bill.
The Ex-Im Bank is the U.S. credit export agency that provides loans to foreign buyers of U.S. exports. The bank benefits big companies like Boeing because it helps finance the sale of its jets, for example, to foreign carriers like Emirates. The bank’s charter was renewed by Congress last year after a protracted fight between the GOP’s pro-business and more conservative free-market wings.
The issue over the quorum requirement is proving to be another round in the battle over the banks’ future.
Freedom Partners, which this month organized a coalition of conservative groups to urge Senate Majority Leader Mitch McConnell (R-Ky.) and House Speaker Paul D. Ryan not to ease the Ex-Im quorum rule, is pleased that the spending bill does not lift the quorum rule.
“Freedom Partners is encouraged that lawmakers haven’t caved to the back-door efforts that would unleash billion in corporate welfare,” said the group’s senior policy adviser Andy Koenig. “We continue to urge Majority Leader McConnell, Speaker Ryan, and all fiscal conservatives to stand with taxpayers and reject any attempt to open the floodgates on Ex-Im Bank corporate welfare — both now and in the upcoming lame duck.”