Nocera: Revenge of the ideologues

'Idiotic,' sputtered Heidi Heitkamp, the Democratic senator from North Dakota. 'Mind-bogglingly idiotic.'

She was talking about something she has been fighting for months: the effort by conservative ideologues to prevent the Export-Import Bank of the United States from being reauthorized. The Ex-Im Bank that supports tens of thousands of good American jobs. The Ex-Im Bank that helps land deals, for both small businesses wanting to expand and giant American exporters, that would otherwise go to foreign companies. The Ex-Im Bank that in its last fiscal year generated enough in fees and interest to turn over $675 million to the Treasury. Why would anyone in his right mind want to put such a useful agency out of business?

In truth, a vast majority of senators — Republicans included — very much want to see the Ex-Im Bank live to lend another day. So do most businesspeople, no matter what their politics. This past week, when a reauthorization amendment was attached to the big Senate highway bill, it got 64 votes. Jim McNerney, the chairman of Boeing, noting that the Ex-Im Bank helps keep manufacturing jobs in America, wrote recently in Politico, 'I never thought I'd see the day that U.S. companies would, in effect, be penalized by their own government for not setting up shop overseas and, in the case of Boeing, expanding our domestic production and workforce by billions of dollars and thousands of jobs.' Heitkamp is not exaggerating: Eliminating the Ex-Im Bank truly is mind-boggling.

You'll recall that the bank, which had never been controversial until about three years ago, needed to be reauthorized by the end of June. That didn't happen, as the Republican leadership, bowing to its extremist wing, allowed the date to pass without a reauthorization vote. That meant the bank had to stop underwriting new loans, although it continues to manage its $107 billion loan portfolio.

Then last week, even after the overwhelming Senate vote — and knowing full well that the House would approve reauthorization if given the chance — House leaders refused to include it in their ridiculously short-term three-month extension of the highway funding bill. (Which, by the way, is another shortsighted, anti-American-jobs move.)

So now supporters have to hope they can get a reauthorization vote in September, a month when the House has only 12 legislative days on the calendar. (The Senate has 15.) And if they don't succeed? There would be no one left to manage the portfolio, which under its charter only the Ex-Im Bank can handle. Another is that the Ex-Im insurance many banks rely on will expire — and in all likelihood the banks will start calling in those loans.

Boeing, being the country's largest exporter by dollar volume, has said that if its customers no longer have access to the Ex-Im Bank — export credit agencies are vital in aircraft deals — it might have to move some operations offshore to gain access to other countries' export credit. Fred Hochberg, the president of the Ex-Im Bank, told me that at a recent meeting at the White House, one small-business man said that competitors were trying to poach his customers, knowing that he no longer had Ex-Im support. Another businessman, who runs a machine parts manufacturer in Erie, Pa., said many of the companies around Erie are General Electric suppliers. 'If GE does less exporting, the whole supply chain will get less work,' he said. These are not bluffs. This is how the world actually works.

Hochberg had a few other things to say when we spoke. The argument by opponents that 'most drives me crazy is that we're a form of crony capitalism. We're the opposite of that,' he said. 'Companies come to us when they can't get a deal done any other way. I had about 15 bankers in here yesterday, and they were thunderstruck. One banker said, 'If I could do deals without you I would. I make more money when you're not in the deal.' '

'In the 6½ years I've been in this job, the world has gotten so much more cutthroat competitive,' Hochberg added. Noting that both China's and India's export-credit agencies have said, in effect, they were looking forward to a world in which they didn't have to compete with the Ex-Im Bank, he said that the effort to put it out of business 'seems ludicrous.'

Heitkamp thinks that if the ideologues succeed in finishing off the Ex-Im Bank, it will be only the beginning of such efforts. 'What will they do with the Small Business Administration?' she asked. 'What about the other tools we provide to small business? I don't think I'm being alarmist in saying that if they win this debate, what's next?'

With the Ex-Im Bank, the extreme right has drawn a line in the sand. Given the very real benefits it provides exporters, the time has come for the rest of us to do the same.

Joe Nocera is a columnist for the New York Times.