SHOCKER: The One Bank Liz Warren Likes Doles Out Tax Dollars
Democratic Sen. Elizabeth Warren came to prominence as a critic of big banks, but one bank she does support is a government agency that lends taxpayer dollars to exporters.
At the first of three congressional hearings scheduled this week on the Export-Import Bank, Warren said Tuesday that while she favors reauthorizing the government export credit agency, Congress should also require it to enhance its support for small businesses, The Hill reports.
“There is significant room for improvement in the bank’s operations,” Warren said. “We should push the bank to do more for small businesses.” (RELATED: Dems Put Aside Anti-Corporate Rhetoric to Support Ex-Im)
Ex-Im’s current charter is due to expire June 30, and a growing coalition of Republican lawmakers and free market groups are hoping to prevent Congress from extending the bank’s authority to issue new loans. Supporters say the bank boosts job growth by helping exporters sell their goods overseas, but opponents contend its primary function is to provide corporate welfare for large corporations like Boeing, General Electric and Caterpillar.
Warren’s remarks indicate she finds some credence in the latter view, but nonetheless believes it is possible to address the issue short of doing away with Ex-Im entirely.
The law already requires Ex-Im to devote at least 20 percent of its portfolio to small businesses, but imposes few consequences for failure, according to Politico. As a result, the bank frequently fails to meet the goal, and 2014 marked the first time in four years that it reached the threshold.
Even so, Boeing received about 40 percent of Ex-Im financing in 2014—roughly double the share for all small businesses combined—and Caterpillar collected 70 percent of the loans awarded by Ex-Im’s largest program.
To reorient the bank’s focus toward small businesses, Warren proposed raising the small business lending requirement “substantially” above 20 percent, as well as creating stronger enforcement mechanisms to ensure that Ex-Im meets the higher threshold.
Yet at Ex-Im’s second hearing in as many days on Wednesday, House Financial Services Committee chairman Jeb Hensarling accused Warren and other Democratic Ex-Im supporters of being inconsistent in their policy positions.
Hensarling has been at the forefront of efforts to shut the bank down, and any bill to reauthorize Ex-Im would have to go through his committee under normal legislative procedure. (RELATED: Hensarling: ‘Momentum is in Our Favor’ for Ending Ex-Im)
Hensarling kicked off the proceedings by pointing out that Democratic support for Ex-Im contradicts the party’s positions on other issues. And while he did not mention Warren specifically, many of Hensarling’s points address stances that Warren is widely identified with.
“Democrats claim Ex-Im is essential to U.S. trade,” he observed, but “if my Democratic friends are so concerned about trade, why are so many of them opposing Trade Promotion Authority?”
Warren has been among the leading critics of TPA, which is widely seen as a precondition to eventual Senate approval of the Trans-Pacific Partnership free trade agreement. (RELATED: Sens. Graham, Cantwell Threaten to Torpedo TPA Over Ex-Im)
“How many times have we heard Democrats vilify Wall Street banks?” Hensarling said. “Yet the big banks profit off Ex-Im like few others.” According to Hensarling, JP Morgan Chase has received $5.1 billion in assistance; Citigroup, $1.5 billion; Wells Fargo, $500 million; and HSBC almost $1 billion.
Warren’s political career began as an exercise in Wall Street vilification, and each of those banks have been subject to her wrath at some point.
The Daily Caller News Foundation sought reactions from Sen. Warren’s office, but did not receive a response by press time.
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