GOP senators called each other liars. House conservatives threatened to oust the speaker. Rank-and-file Republicans rebelled against the rebellion to save the bank.
And all this came before President Trump had won a single primary in his 2016 presidential campaign.
Even after mainstream Republicans restored Ex-Im’s charter, in late 2015, they could not overcome staunch conservative opposition to the agency of “corporate welfare,” as opponents labeled it.
For more than four years the agency has been effectively dormant, with just one board member out of five slots, lacking a quorum to issue new loan guarantees.
That changed Wednesday when Senate Majority Leader Mitch McConnell (R-Ky.) allowed confirmation votes on three board members, each of whom passed with near unanimous Democratic support and sizable Republican opposition. Once again, Ex-Im is back in business, able to support loans larger than $10 million for some of the largest U.S. exporters.
But the fight is far from over. Just as it is finally getting a board, the Ex-Im Bank faces another fight over its very existence, as the 2015 legislation reauthorizing the agency is set to expire in the fall, setting up a debate that never seems to end and has left the bank’s supporters continually puzzled.
“It’s a mystery to me why Republicans have decided that this is their go-to boogeyman,” said Sen. Patty Murray (D-Wash.), a prominent supporter of the bank.
The GOP split over Ex-Im is a reminder that much of the party’s divisions came into full display before Trump. In this instance, Trump’s White House is a symptom of the agency’s peril, not the cause.
Koch Industries and its affiliated political networks turned Ex-Im into a cause celebre for conservatives. They targeted it as a corporate handout to Boeing, GE and Caterpillar, titans of their industries that received 97 percent of Ex-Im financing in 2013.
“Ex-Im financing ‘supports’ jobs rather than creating them, at best, merely shifting jobs around in the economy as demonstrated by research and industry claims. The bank’s lending practices also illustrate the ills of corporate welfare and cronyism,” Grant Kidwell, a policy analyst for the Charles Koch Institute, wrote in 2015.
Over the past 15 years, some of the most prominent Republicans joined the opposition. “A form of crony capitalism and taxpayer subsidy of companies far and wide,” Sen. Patrick J. Toomey (R-Pa.) said during debate Tuesday for the Ex-Im nominees.
Toomey, who once served as president of another conservative group, the Club for Growth, has used his prominence on the Senate Banking Committee to bottle up nominees for the board since early 2015.
Support or opposition sometimes falls along the fault line of whether Boeing has much of a presence in a GOP senator’s state. “It’s the biggest source of corporate welfare we’ve ever seen,” said Sen. Richard C. Shelby (R-Ala.), whose clashes with the aerospace giant are legendary in Capitol hallways, especially since Boeing rival Airbus calls parts of Alabama home.
But Sen. Lindsey O. Graham (R-S.C.), where Boeing has thousands of employees, has fought fiercely for Ex-Im, linking arms with Murray and Sen. Maria Cantwell (D-Wash.), whose state was once home to Boeing and retains tens of thousands of the company’s employees.
“It will make South Carolina, and other U.S. manufacturers, even more competitive with China and other nations,” Graham said Wednesday, calling the Toomey-Shelby approach “unilateral surrender” to foreign competitors.
Trump’s White House, as is often the case, is bitterly divided over Ex-Im.
Robert E. Lighthizer, the U.S. trade representative, and Peter Navarro, Trump’s trade adviser, are strong supporters. They argue that almost every other nation has an export credit agency. China’s agency had more than $360 billion of export credits in 2017 — five times as much as the Ex-Im Bank.
Lighthizer and Navarro argue that Ex-Im’s default rate is minuscule, a tiny cost to pay for an agency that they say supports 1.7 million jobs.
Mick Mulvaney, the acting White House chief of staff and director of the Office of Management and Budget, is firmly opposed to the bank. In Congress, he joined the House Freedom Caucus, the band of arch conservatives who drew a line in the sand and dared John A. Boehner (R-Ohio), then the speaker, to allow a vote on Ex-Im.
Mulvaney has populated OMB with a slew of lieutenants who worked for Freedom Caucus members or other conservatives, including Sen. Ted Cruz (R-Tex.).
In the spring of 2015, as he launched his presidential bid, Cruz grasped onto the Ex-Im fight as his moment to prove he was the purest conservative in the race.
McConnell had been forced into promising Murray a vote on Ex-Im to pass legislation to create fast-track authority for trade deals, leading Cruz to accuse McConnell of being a liar.
“What he told the press over and over and over again was a simple lie,” Cruz said in an extraordinary June 2015 floor speech.
Ultimately, the Senate approved a four-year extension for Ex-Im, leaving its fate in the hands of Boehner. GOP supporters waited and waited until Boehner announced he was resigning for other reasons, and amid a leadership vacuum they linked arms with House Democrats and got a majority of House members to sign a petition, forcing a vote.
In a rebuke to GOP leaders, a clear majority of Republicans voted to keep Ex-Im in business, seemingly ending the debate.
But the blockade against the board members left it even deeper in limbo, an agency functioning but without leadership or a quorum to approve big new loans.
When the administration first sent up nominees, in 2017, they included Scott Garrett (R-N.J.), a former congressman who served in the Freedom Caucus and called for abolishing Ex-Im. The agency’s supporters torpedoed his nomination and, almost 2 1 /2 years into Trump’s term, are finally getting the agency going again.
Only to have the same fight all over again a few months from now.