EXPORT-IMPORT BANK CREATES LOCAL JOBS

EXPORT-IMPORT BANK CREATES LOCAL JOBS

by David L. Joyce is president and CEO of GE Aviation

Unless you compete globally and sell U.S. products abroad, you may be unfamiliar with the financing power of an institution called the U.S. Export-Import Bank (Ex-Im).

The Ex-Im Bank’s charter expires June 30. Without reauthorization by Congress – which has authorized the bank many times previously – funding for this critical agency will expire.

I feel compelled to express my views on how important this institution is to Greater Cincinnati and to communities across our great nation.

Ex-Im is a federal agency that provides critical financing and loan guarantees for international sales of U.S. industrial products. Over the past two years, Ex-Im has generated more than $1.7 billion of returns to our government, while reducing our budget deficit and promoting jobs here at home.

Many nations competing with the U.S. (59) provide export credit assistance to stimulate foreign sales. China’s export bank provided more than $430 billion in loan guarantees for Chinese goods sold worldwide last year; Canada provided more than $90 billion; and France, Germany, the UK and Italy combined for more than $170 billion. In comparison, the Ex-Im Bank in the U.S. provided $27 billion.

So why is this so controversial? A vocal political faction believes that providing financing and loan guarantees for our international customers are not necessary. Even some politicians in our area, where the Ex-Im Bank promotes tens of thousands of local jobs, call for its demise.

This would impact GE Aviation and many smaller companies in the Tristate. Almost 60 percent of GE Aviation’s revenues last year were generated from international sales. In the next five years, that figure jumps to 75 percent. We compete and win around the globe, and bring those orders to the U.S. to manufacture using U.S. workers. The Ex-Im Bank is an essential ally in many of these foreign sales campaigns.

Unfortunately, this issue has become politicized to the point where the facts are sacrificed for the sake of a news headline.

Critics call Ex-Im “crony capitalism” for big U.S. businesses, although four out of every five transactions Ex-Im supports are to small- and medium-size businesses. They say Ex-Im is “high risk” even though its default rate is only 0.175 percent, comparable to that of the largest commercial banks. Or, that it is a “drain on taxpayers,” even though over the last two decades, Ex-Im has generated $6.9 billion in returns for U.S. taxpayers after accounting for all costs.

There is no disputing these facts. Ex-Im supports 1.3 million U.S. jobs, including tens of thousands in Southwest Ohio and Northern Kentucky, without costing taxpayers a dime.

Ohio has made remarkable progress emerging from the financial crisis, and we are restoring and “reshoring” critical manufacturing jobs. In our Southwest Ohio facilities, GE Aviation has invested more than $400 million since 2013 on the strength of international sales while supporting 9,000 jobs. We also spend more than $1.2 billion each year with hundreds of Ohio suppliers. The Ex-Im benefit also extends to rural counties, such as the $160 million investment since 2007 in our Peebles facility, which provides high-paying jobs to Adams County. Our people are proud members of their communities, dedicating more than 50,000 volunteer hours each year in Greater Cincinnati alone.

Our region has progressed too far to let political grandstanding put our exporting power at a steep disadvantage.

When government officials become more concerned about their “rankings” by well-funded political action groups and ideological “D.C. think tanks” than the well-being of the constituents in their districts, it’s time to call on them to reconsider their priorities.