Timothy Carney’s latest attack against the Export-Import Bank on Sept. 19 used incomplete data and misrepresented Ex-Im’s Express Insurance policy for prospective small-business exporters.
As background, Congress requires Ex-Im to support small business and requires Ex-Im to publicly report its activities by amount of authorizations.
Carney cherry picks partial-year data for one of the many programs that Ex-Im makes available for small business, and then claims a portion of these businesses never “got coverage on a penny of exports.” What he fails to tell his readers is that more than one-third of the total number of unutilized polices are fiscal 2016 and fiscal 2017 policies that are still active, and that the Bank has the expectation that many of these policies will be utilized before they are due to expire. He also fails to tell his readers that the data he cites is incomplete data for only a portion of the year.
While Carney focuses his energy on Ex-Im’s Express Insurance product, that’s just one of many ways the Bank supports and helps grow small businesses across America. For example, Ex-Im authorizes working capital guarantees for small businesses, which help meet export orders and hire more workers. Seventy percent of the bank’s working capital authorizations supported small businesses in fiscal 2016. Every dollar Ex-Im guarantees on working capital for small businesses generates nearly four dollars in supported exports, meaning on that particular product line, Ex-Im’s impact is well beyond the reported dollars authorized.
In addition, Ex-Im supports small businesses through a range of export credit insurance products and medium-term loan guarantees for foreign buyers of U.S. exports. Carney conveniently omits mentioning these products because the numbers don’t fit his narrative.
Many of Ex-Im’s insurance policies also typically support more exports than the authorized policy amounts because multiple shipments can be insured and paid for during the same policy period. Think of it like having a credit card limit of $5 million. That is just the total amount that you can have on the credit card at any given point in time. You pay the card off each month and then you can use it again up to the authorized amount. Ex-Im only reports the $5 million limit, but the small business may support tens of millions of dollars on that policy each year.
A significant part of Ex-Im’s mission is to help American small business move into the world of exporting, so that the United States grows its economy, creates more good American jobs, and shows the world the quality and workmanship of goods and services made proudly in the USA. This is not a process that happens overnight with most companies. Offering small businesses a product that helps them expand beyond American borders is a powerful way to accomplish this part of Ex-Im’s mission.
Carney’s crusade against Ex-Im goes back many years. He thinks the bank should not exist, despite the fact that there are 96 other Export-Import Banks around the world supporting their countries’ exports. In fact, China financed more of their country’s exports in two recent years than the U.S. Ex-Im has financed in its entire 83-year history.
President Trump, like President Ronald Reagan many years before him, has made clear that his top agenda item is growing the American economy and creating good American jobs. He has also made clear that we must counter China’s growing trade threat. The Export-Import Bank is proud to be an important tool in helping achieve the president’s agenda and in enabling American companies to expand their businesses and increase the prosperity of this great nation.
Charles J. Hall is acting chairman and president of the Export-Import Bank of the United States.
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