Lawmakers are struggling to strike a bipartisan deal to reboot the Export-Import Bank as impeachment and the 2020 election threaten to derail a fleeting window for the major reform bill.
The White House and Congress were poised to pass a long-term extension and expansion of the Ex-Im Bank, sparking optimism among manufacturers battered by President Trump’s trade conflicts.
But the collapse of a bipartisan House deal on an institution that provides loans to the country’s exporters has thrown its future into doubt as the Senate searches for its own solution.
Senators are seeking a bill that can balance widespread support for Ex-Im’s mission with concerns from conservative skeptical of the bank as subsidizing companies and distorting the free market.
Those divides extend to Trump’s fractious economic team, where free-market advocates and staunch trade protectionists are jockeying for the president’s ear.
Congress will likely keep Ex-Im open through an extension of its charter as impeachment proceedings and negotiations to avoid a shutdown dominate the rest of the year. That could leave mere weeks for senators to produce a viable bill in early 2020 before campaign season derails its efforts.
“We obviously have not been able to get to where we can get legislation that would not be filibustered on the floor,” Senate Banking Committee Chairman Mike Crapo (R-Idaho) told The Hill last week.
“It’s just a tenuous process of trying to find a way forward where we can move without having to use up a week’s worth of floor time.”
GOP divisions over Ex-Im have exasperated Republican legislative leadership for five years. While Ex-Im had enjoyed wide bipartisan support since it was established in 1934, a conservative crusade shuttered the bank for nine months in 2015 and kept its board largely empty until May.
Ex-Im appeared ripe for a reboot after the 2018 retirement of Rep. Jeb Hensarling (R-Texas), the former House Financial Services Committee chairman who helped lead the 2015 effort to defund the bank.
Waters and McHenry unveiled a bipartisan bill to extend Ex-Im’s charter for 10 years, insulate the bank from defunding efforts, and limit its ability to finance exports to Chinese firms.
The bill was hailed by some as a major victory over the bank’s powerful critics among conservative political non-profits, including Heritage Action and Americans for Prosperity.
“Even back in our day we would have thought, ‘Hey, that’s a pretty good deal,’” said Stephen Myrow, a senior vice president at Ex-Im from 2006 to 2008. “I could see why those who oppose Ex-Im balked.”
While GOP members of the Financial Services panel expressed openness to the bipartisan deal, objections from Ex-Im’s fiercest Democratic allies forced Waters to pull her bill with McHenry before a markup.
A new measure from just Waters with fewer restrictions on lending to Chinese state-owned firms, rewritten to soothe Democratic concerns, passed the House earlier this month with no Republican support and a veto threat from the White House.
“The Administration is committed to the long-term reauthorization of the Export-Import Bank,” said the White House budget office. “[The House bill], however, does not represent the type of bipartisan, bicameral approach needed to appropriately accomplish that goal.”
Now, it’s up to Crapo and Sen. Sherrod Brown (D-Ohio), ranking Democrat on the Senate Banking Committee, to find a deal that will bridge divides between their parties and among the GOP.
Senate Majority Leader Mitch McConnell (R-Ky.) helped secure a deal to reopen Ex-Im in 2015 after the conservative insurrection, but is unlikely to take up a more ambitious bill without ample GOP support.
“The problem is this corporate welfare versus export promotion fight that permeates basically all the key parts of government here,” said Myrow, now a managing partner at Beacon Policy Advisors, a Washington, D.C. policy analysis firm.
Conservative Republicans denounce Ex-Im as the epitome of crony capitalism, propping up U.S. exporters with corporate welfare by financing deals that wouldn’t be possible without government support.
But the party’s moderate wing finds common cause with Trump and his protectionist advisors, insisting the U.S. must protect its exports from China’s far greater subsidies.
“Traditional conservatives,” will argue that “if you can’t get these deals in the private sector, they don’t deserve to get done,” Myrow said. “And the other side will say, ‘but that’s the equivalent of unilateral nuclear disarmament, not the reality of the world.’”
While Vice President Mike Pence and like-minded officials are critics of Ex-Im, protectionists such as Commerce Secretary Wilbur Ross and trade advisor Peter Navarro support the bank as another weapon in the trade war against China.
Brown said Wednesday that conflicting views among Trump’s officials have derailed negotiations with Crapo, saying the White House “continues to undermine us” and is “betraying the efforts of job creators.”
“They’re for it, they pull it away, Pence blocks it, or somebody else walks in,” Brown continued.
“I mean, they’re saying the right things, but why believe them when they lied so many times.”
But Crapo insisted that the White House has been nothing but supportive as Republicans seek to balance the concerns within their ranks.
“No matter which way we turn, there are some who want to expand and some who want to reform,” Crapo said. “And no matter which of those alternatives we choose, it creates the potential the filibuster on the floor.”