Cruz Misrepresents Ex-Im’s Impact
In addition to making inflammatory remarks today, Sen. Ted Cruz also misrepresented—again—key facts about the Export-Import Bank.
Please see below some factual counterpoints to his comments.
Point: Ex-Im is used only by a “handful of giant corporations.”
Counterpoint: Thousands of small businesses use the Ex-Im Bank in states across the country.
Ex-Im Support For Small Businesses “Has Grown Every Year Since FY 2009.” “Small business authorizations dominate [Ex-Im] bank financing when looking at the total number of authorizations. The number of small business authorizations has grown every year since FY 2009, hitting an all-time high of 3,413 authorizations last year at 89 percent of total authorizations.” (Andy Winkler, “Connecting America’s Small Businesses To Foreign Buyers: The Role Of The Export-Import https://exportersforexim.org/files/2015/07/bank,” American Action Forum, 6/23/14)
Point: Boeing said it will “be just fine without the Ex-Im Bank.”
Counterpoint: In the near term, Boeing doesn’t expect disruptions, but in the long run it will be difficult to remain competitive without the Ex-Im Bank.
Boeing CEO Says Not Having Ex-Im Will Harm Long-Term Competitiveness. “I will say, from a company perspective, as we’ve said before, this is not something that creates near-term financial risk for Boeing. There are multiple commercial credit sources today. The market is sound there. We have about 15% of our customers that use Ex-Im financing as a backstop financing, but in the current financing market that doesn’t create risk for us. This is about long-term global competitiveness. And that’s why we’re so forceful on this topic that it’s important Ex-Im be reauthorized. It’s about allowing U.S. industry to be globally competitive. It’s about American manufacturing jobs. It’s the right thing for the country to do. And we’re going to continue advocating on behalf of U.S. manufacturing jobs.” (Boeing President and Chief Executive Officer Dennis Muilenburg, “Earnings Call,” 07/22/2015)
Moody’s: Boeing Now Facing A “Competitive Disadvantage” Against Airbus That Will Continue To Grow If Ex-Im Isn’t Reauthorized. “But while its share of ECA financing has also been shrinking of late, also benefiting from strong capital markets support, Airbus does not have Boeing’s now competitive disadvantage of having just lost local ECA support to help finance future deliveries. The perceived disadvantage is expected to be increasingly grounded in reality and evidenced in an ever more pronounced way with the passage of time. At present, roughly 55%-60% of the current order book is from emerging market customers. And we project that roughly one-half of long-term future aircraft demand will emanate from the Far East, in particular, a market that would seem well suited to Ex-Im funding support – if it is around.” (Russel Solomon & Robert Jankowitz, “Boeing Most Exposed If Ex-Im Bank Remains Closed To New Business,” Moody’s Investors Service, 7/22/15)