Question: Are other countries "stealing" American jobs and manufacturing operations, or is Congressional obduracy driving them away?
"I will bring back jobs!" the candidate shouts. The economy is in terrible shape, he insists, and good American jobs are disappearing by the thousands to foreign companies. And he blames international companies, aided by foreign governments, for the employment theft.
Meanwhile, his own party tromps on a key government program that helps U.S. firms small and large by providing financing for their exports. Result: U.S. firms lose business because they cannot sell stuff overseas, so they relocate operations to other countries. And that means closed factories and lost jobs in America. Large corporations can do this. Small companies just go out of business.
So instead of helping U.S. firms increase sales and expand their workforce, this failure to assist in financing does just the opposite.
For 80 years, the Export-Import Bank has provided financing to help U.S. companies sell stuff to overseas customers. And the bank has consistently done so at a profit, turning over its earnings to the U.S. Treasury. In the process, U.S. companies thrive and American workers have good jobs.
How it works:
A foreign customer wants to buy an airplane from Boeing, for example, but can't find the cash at home. The Ex-Im Bank in Washington finances the deal. Boeing sells an airplane and its workers have jobs. The customer gets an airplane at reasonable financing, its personnel have jobs, and people have transportation.
The loan is paid back, and the Ex-Im Bank net after expenses goes to the U.S. Treasury.
Who loses? No one. So why shut down a good thing? Petty Politics.
Last year, the Ex-Im Bank supported $17 billion in exports, along with 109,000 jobs. After expenses, the bank remitted $451.6 million to the U.S. Treasury. Over the past two decades, the bank posted a surplus of $7 billion, which went to the Treasury. Some 90 percent of their business is helping small firms get financing for overseas transactions, at a default rate of 0.2 percent.
But ...
Republicans in Congress have stalled renewing the bank's charter, and the bank has not taken on a new customer for a full year. Now, a single senator has blocked high-ticket sales by U.S. manufacturers.
Recently, GE said it would shift some of its operations from South Carolina to France, as that country will provide help in financing sale of large turbines to customers in other nations.
How did Congress make this happen? One, by stalling a renewal of the Ex-Im Bank charter, which would have put it out of business entirely, resulting in lost revenue to the U.S. Treasury. The charter was renewed a few months ago, after more months of political chatter.
Two, by refusing to approve new members of the bank's board of directors, leaving it without a quorum to approve major deals above $10 million. The Ex-Im Bank board now has just two members, while it is set up for five. It needs one more for a quorum. But without three members, the bank is unable to complete financing transactions of $10 million or more.
There are now 30 deals totaling more than $20 billion waiting for approval by the Ex-Im board, but without a quorum, the deals are in financial limbo.
Who's behind this?
Sen. Richard Shelby, Republican from Alabama, chair of the Senate Banking Committee, according to published reports. Sen. Shelby has blocked the appointment by President Barack Obama of a third board member, which would give it a quorum and the ability to approve those $20 billion worth of contracts.
So what's a business to do? Go elsewhere, that's what.
This is a big reason why firms like Boeing and GE are closing American shops and moving operations to other countries, where they and their customers can get financing help.
And this is how American jobs go overseas.
In seems that GOP legislators, in their personal animosity to anything and everything Democrat Obama may propose, are abandoning their historic close ties to business.
Their political egos may be satisfied, but citizen welfare suffers.
Even so, despite Congressional fiddling, the U.S. economy continues to burn -- though not as brightly as it could.
After nearly flaming out eight years ago, during the worst downturn since the Great Depression of the 1930s (which also began during a Republican administration), the U.S. economy has been slowly recovering.
Growth in the first quarter of this year was 1.1 percent, according to the latest estimate by the Commerce Department, compared to 1.4 percent in the final three months of 2015. Corporate profits, meanwhile, were up and the unemployment rate remained below 5 percent.
But could the economy have recovered faster and farther with more government help? Probably. But when any attempts by a Democratic administration are blocked by a Republican Congress determined to prove Obama a failure, who really suffers?
As for the current leading GOP contender for the presidency and his history of lining his own pockets as contractors and customers of his many business ventures, as well as the businesses themselves, go broke ...
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