President Donald Trump has announced his intention to nominate former House Rep. Scott Garrett to lead the U.S. Export-Import Bank despite his outspoken opposition to the agency and what he called its “long legacy of crony capitalism.”
President Donald Trump has announced his intention to nominate former House Rep. Scott Garrett of New Jersey to lead the U.S. Export-Import Bank despite his outspoken opposition to the agency.
In addition, Trump will nominate fellow former Rep. Spencer T. Bachus III of Alabama to serve as a member of the bank’s board of directors, according to an official White House statement Friday.
Ex-Im provides loans to foreign companies buying U.S. exports, as well as credit programs aimed at helping small businesses secure necessary capital and bringing in new international customers, and insurance on receivables so an exporter isn’t left holding the bag if a customer doesn’t pay its bills.
Supporters say the export credit agency fills in the gaps when traditional commercial financing is unavailable, especially in areas of the world with higher risk exposure or less developed capital markets.
But critics have complained rather loudly over the years that the Ex-Im Bank essentially amounts to “corporate welfare,” arguing that the greatest benefits go to big corporations that don’t need assistance and that private lending institutions, not the government, should help finance American exports.
Tensions over the bank’s reauthorization actually caused it to shutter operations briefly in 2015, and Senate leaders were forced to attach legislation funding the agency to a greater transportation bill in order to push it through Congress.
Since then, however, Ex-Im has been operating without a full quorum, meaning that the bank has been unable to approve transactions of more than $10 million. Agency rules require three of it’s five board members to approve such large deals, but only has two board seats filled and late-term nominations by President Barack Obama were blocked by Senate conservatives, most notably Sen. Richard Shelby, R-Ala., chairman of the Senate Banking Committee at the time.
Trump, who had been among the critics of the bank, told the Wall Street Journal on Wednesday he would fill the board vacancies and restore the Ex-Im to it’s full operating power.
“Actually, it’s a very good thing. And it actually makes money; it can make a lot of money,” he said in a reversal from prior statements. “It turns out that, first of all, lots of small companies are really helped, the vendor companies.
“I was very much opposed to Ex-Im Bank, because I said what do we need that for IBM and General Electric,” he added. “It turns out that, first of all, lots of small companies will really be helped, the vendor companies. But also maybe more importantly, other countries give it, and…we lose a tremendous amount of business.”
Some lawmakers are questioning Trump’s intentions in nominating Garrett, who in 2015, said the agency’s “long legacy of crony capitalism has hurt the livelihoods and businesses of many Americans who don’t get special treatment from this misguided government program.”
House Minority Whip Steny Hoyer, D-Md., for example, urged senators to reject Garrett’s nomination, even going as far as to call it an “act of sabotage” on the part of the president.
“Once again, President Trump has selected a nominee to lead an agency that individual believes should not exist and has tried to destroy,” Hoyer said in a statement Saturday. “In Scott Garrett, the President has nominated someone who helped lead the charge to shut down the Export-Import Bank in Congress against a super-majority that was in favor of keeping it open so it could continue creating and supporting American jobs and exports. If former Rep. Garrett is confirmed to lead the Bank, it would be the ultimate act of sabotage.
Trump to nominate vocal Ex-Im critic to run bank
