Thu July 3, 2014
Export-Import Controversy Gives Rise To A Tale Of Two Washingtons
Originally published on Thu July 3, 2014 6:26 pm
ROBERT SIEGEL, HOST:
From NPR News this is ALL THINGS CONSIDERED. I'm Robert Siegel.
MELISSA BLOCK, HOST:
And I'm Melissa Block. A debate has been raging in Washington, D.C. over the future of an obscure federal agency - the Export-Import Bank. And all the way across the country in the other Washington - Washington state - businesses, labor unions and politicians say the bank's demise would have severe consequences. Ashley Gross of member station KPLU in Seattle reports.
ASHLEY GROSS, BYLINE: In a cavernous factory south of Seattle, workers are cutting aluminum and steel. And Steve Paige, chief financial officer of the company AeroGo is pointing out the equipment they're making.
STEVE PAIGE: This over here is what we call our 300 ton transporters.
GROSS: AeroGo makes big equipment that moves around heavy stuff - like rockets or power plant transformers. Thirty percent of the company's sales are exports.
PAIGE: This one is going to China, actually.
GROSS: And did you use Export-Import bank for this sale?
PAIGE: We will when we ship it, yeah.
GROSS: The Export-Import Bank is run by the U.S. government, and its mission is to make it easier for U.S. companies to sell to foreign customers. AeroGo buys insurance from the bank. So if the company sells a half million dollar piece of equipment to China and the customer never pays, AeroGo can file a claim with the government to recover most of the cash. That rarely happens, but there was this one troublesome company in Europe.
PAIGE: It was Belgium.
GROSS: AeroGo sold an $80,000 piece of gear. Months went by with no payment. The customer went into bankruptcy.
PAIGE: And there was some question as to whether they could come up with the money or not to pay us.
GROSS: So after a year, AeroGo took action.
PAIGE: When we presented them with a demand letter indicating that we were going to be opening an insurance claim with the Export-Import Bank of the United States of America, they rendered payment within 30 days.
GROSS: So you feel like you have big Uncle Sam right behind you?
PAIGE: Yeah, it carries the weight of the U.S. government.
GROSS: The biggest criticism of the Export-Import Bank is mostly focused on companies that are larger than AeroGo and comes primarily from Tea Party Republicans. Here's a clip from a YouTube video posted by the conservative group Americans for Prosperity.
(SOUNDBITE OF YOUTUBE VIDEO)
UNIDENTIFIED MAN: Corporate interests and their allies in Washington want to extend the life of this foreign bailout bank, putting taxpayers on the hook for even more so that we can keep paying for their revolving line of corporate welfare.
GROSS: The Export-Import Bank doesn't just sell insurance, it also makes loan guarantees to help a Polish airline, say, get a commercial bank loan to buy Boeing airplanes. Washington state is the biggest beneficiary of the Export-Import Bank because most Boeing planes are built here. The Washington Congressional Delegation has been storming the state to make the case for saving the bank. Here's Senator Maria Cantwell.
(SOUNDBITE OF ARCHIVED RECORDING)
SENATOR MARIA CANTWELL: Eighty-five thousand Washington state jobs hang in the balance if this program is canceled on September 30.
MICHAEL PARKS: I'm skeptical of that sort of a number.
GROSS: Michael Parks is an analyst who studies the Pacific Northwest economy. He says if the bank disappears, Boeing will be somewhat disadvantaged, but it's not going to lead to a massive economic collapse.
PARKS: As long as Boeing produces a competitive product, they will do fine and the jobs will remain.
GROSS: Boeing executives have said the loss of the bank would be a huge blow and make it harder for them to compete against Airbus. Steve Paige of AeroGo says he's a bit mystified by the controversy.
PAIGE: I guess the real question in my mind is why not support the Export-Import Bank when it's self-funded and every other country that we're going to be competing with has some function similar to the Export-Import Bank?
GROSS: Paige says he's hopeful the bank gets reauthorized. After all, he still needs insurance for sales to China, Spain, Thailand and other countries. For NPR News, I'm Ashley Gross in Seattle. Transcript provided by NPR, Copyright NPR.