Ex-Im has provided financing or loan guarantees that have helped Duluth-based tractor manufacturer AGCO win export deals. 

Critics urging Congress not to renew the charter of the Export-Import Bank of the United States, which is up for a vote in June, often decry what they call the “bank of Boeing” as a conduit for “crony capitalism” since the bulk of its financing (by value) goes to corporate giants.  

But defenders of the export-credit agency among Atlanta’s cadre of large companies say these “one-liners” miss a key nuance: even large deals affect a long line of smaller suppliers, creating thousands of jobs down their value chains. 

Michael Cully, vice president of government affairs for Duluth-based tractor manufacturer AGCO Corp., a Fortune 500 firm which has used Ex-Im backing amounting to $36 million in the last two years, said the bank’s odds in Congress are improving because the “discussion is shifting.” 

“We’re not talking about how it just benefits major Fortune 500 companies,” said Mr. Cully, who sat on a Cobb County Chamber of Commerce luncheon panel focused on raising awareness for the bank’s impact on local businesses. “We are actually talking about how it’s benefiting the small businesses, the suppliers to those big companies.”

Mr. Cully expressed frustration with the lack of nuance on the issue, a sentiment shared by many supporters of the bank who believe the polarized atmosphere on Capitol Hill is holding an essential tool for American competitiveness hostage to partisan politics. 

Doubts about whether the bank will survive are forcing some of AGCO’s customers to look at buying from other companies in countries with more reliable export credit agencies, Mr. Cully said. Like other companies’ export-credit agencies, Ex-Im provides financing for foreign companies purchasing products from American firms like AGCO, Boeing and General Electric Co. It also provides guarantees for some deals conducted through private banks, giving the U.S. firm the assurance that it will get paid for export sales. 

Critics say Ex-Im not only inordinately benefits big firms, but it also crowds out the private sector by preventing other institutions from developing a similar services. They also add that Ex-Im only covered 2 percent of American exports last year and that Ex-Im is much too generous in how it defines “small companies” (1,500 employees or less). That, combined with the fact that exports grew to a record $2.4 trillion in 2013, means that export financing is readily available, the Heritage Foundation’s Diane Katz wrote in a commentary for Global Atlanta last year

“Finance costs are only one among a variety of factors that affect a foreign purchaser’s choice of supplier. Availability, reliability and stability all play significant parts in purchase decisions. U.S. firms are certainly capable of competing successfully without corporate welfare,” she wrote. 

The fact that these counter arguments hold sway in Congress is “remarkable,” Mr. Cully said, revealing a lack of public understanding of the bank’s role in local markets.

Thomas Matthias, an Atlanta banker who formerly worked for Ex-Im as a credit officer but didn’t want his current bank to be cited, said that the U.S. has been “late to the game” in comparison to other countries such as ChinaCanada and Italy, which have expanded the presence of their export credit agencies. Part of that delay is due to a general ignorance of what the bank achieves.

“The question should not be, ‘Should Ex-Im Bank be around?” Mr. Matthias said at the Cobb chamber luncheon. “They should be around and doing a lot more.” He said that he left the bank in part because he “could not get enough deals done.”

Originating in 1934 amid the economic reforms of the New Deal era, the Ex-Im Bank was chartered by Congress as an independent government agency with the Export-Import Bank Act of 1945. Some now say its original intention to boost U.S. exports by strengthening foreign markets damaged from World War II is outdated in a contemporary global economy. The bank’s effectiveness and relevance remains at the heart of the current controversy. Ex-Im backers say the bank creates jobs and returns some $2 billion to the U.S. treasury annually, while conservative researchers have taken issue with that claim. 

Since 2007, Ex-Im Bank financing has supported over 200 companies in Georgia. Across the country, that number grows to nearly 9,000, with export sales supported by Ex-Im financing valued at $270 billion. 

Steve Hartman, chief technology officer for metro Atlanta-based GE Water and Power and chair-elect for the Cobb chamber, lobbied for the bank in Congress last September before the reauthorization effort was delayed till June. 

“It was an opportunity for us to to tell them the basics as we see it as GE, but also from the perspective of Cobb County,” Mr. Hartman told Global Atlanta, regarding his trip to Washington.

Mr. Hartman said the key to winning the legislative fight over the bank lies in educating Congress on the benefits for local companies. When GE wins a major deal, it creates a “large ripple effect” across local markets, he said. 

In the months to come, the bank faces a tedious political battle as its charter is punted along. Mr. Hartman thinks the outcome should be obvious.

“I’m an engineer, and when you look at the data and walk through what it is, it makes a lot of sense for the U.S. to continue this after 80 years.”

For more on the Ex-Im debate, view these op-eds: 

Ex-Im: Even Large Deals Support Small Firms 

Ex-Im Bank: A Conduit for Corporate Welfare