The U.S. Senate Banking Committee rejected U.S. President Donald Trump’s nominee to head the U.S. Export-Import Bank on Tuesday but approved four other board nominees, enough to restore the trade bank’s full lending powers upon their confirmation by the full Senate.
The committee voted 13-10 against Scott Garrett as EXIM president in a rebuke to conservatives who saw the former New Jersey Republican congressman as an ally who would keep tight controls on the government export lender.
Garrett helped lead a 2015 effort to shut down EXIM to end a source of “corporate welfare” for giant manufacturers such as Boeing Co and General Electric.
After his nomination, he pledged to keep the bank “fully open” but struggled to persuade senators that he now believed in the bank’s core mission of providing taxpayer-backed loans and guarantees for U.S. export transactions.
“I believe he’s a principled man who simply believes in the abolishment of the bank,” said Senator Mike Rounds of South Dakota, who voted against Garrett along with South Carolina Republican Tim Scott and all Democrats on the panel.
The White House’s director of legislative affairs, Marc Short, commented, “We are disappointed that the Senate Banking Committee missed this opportunity to get the Export Import Bank fully functioning again. We will continue to work with the committee on a path forward.”
The committee, however, approved Trump’s nominations for EXIM’s first vice president, Kimberly Reed, and three other board members: former Louisiana congressman Spencer Bachus, Claudia Slacik and Judith DelZoppo Pryor. It also approved Mark Greenblatt as the agency’s inspector general.
Confirmation of at least three board members will allow EXIM to resume approval of loans and guarantees above $10 million, returning the United States to export financing for major projects such as commercial aircraft, power turbines and petrochemical plants for the first time since June 2015.
GE in a statement urged quick confirmation of the remaining EXIM nominees and hailed the committee vote as “a milestone for manufacturers across the U.S. whose customers require a fully-functioning EXIM Bank.”
Currently, EXIM has a $42 billion backlog of deals in its pipeline awaiting approval, representing about 250,000 U.S. jobs based on Bureau of Labor Statistics multiplier data, said Scott Schloegel, an Obama administration appointee who still serves as the bank’s top officer.
Schloegel said with EXIM’s extended absence from large-scale export finance, many U.S. exporters have been unable to compete with China for some major projects in the power and technology sectors.