Nevadans have always worked hard, and our efforts to recover from the recession are paying off. In the last year and a half we have driven our unemployment rate to below 10 percent for the first time in years. As a small business leader, I am proud of the part my company, Click Bond, is playing in putting our state back to work.
Demand for American exports – particularly in aerospace - drives our business and allows us to expand. We employ over 400 highly skilled teammates who design, manufacture, and support high technology fastening systems for airplanes like the Boeing 787 Dreamliner, the Gulfstream G650, and the Cessna Citation family of business aircraft.
Although the “Made in America” brand is strong, and rightfully so, the international market is not a level playing field. One of the tools that U.S. exporters have used to level the playing field is the U.S. Export-Import (Ex-Im) Bank. Ex-Im provides American manufacturers, big and small, with the tools they need to compete head to head with foreign competitors.
Unfortunately, a stalemate in Congress now prevents the Ex-Im Bank from making new loans and loan guarantees. On June 30, legal authority for the bank’s operations lapsed – stopping it from conducting new business. This simply does not make sense.
The bank fills a gap in the private market, since many private banks cannot or will not offer loans or guarantees to foreign purchasers of American made goods.
For example, if an airline in a developing country wants to buy a Boeing airliner, it is often not able to find financing options in the private market. The airline could fill that financing gap if backed by an Ex-Im loan guarantee, allowing them to purchase the aircraft.
In exchange for its loan guarantee, the airline customer pays a fee to Ex-Im. Consequently, the bank does not cost the taxpayers a dime. In fact, last year it returned a net $675 million into the Treasury!
Because Click Bond is a direct supplier to Boeing, the airplane sale creates demand for our parts, creating jobs in Nevada.
Not only does it create jobs, it also allows Click Bond to invest profits to improve its plants and products and train its workforce so that we, and Boeing, can remain strong in an increasingly competitive global marketplace.
In short: when they fly, we fly.
Foreign countries each have their own versions of Ex-Im Bank called Export Credit Agencies (ECAs). Most of them are much larger than Ex-Im relative to gross domestic product. If the U.S. eliminates its ECA and the competitors don’t, it is equal to unilaterally disarming on the battlefield. That is not a winning strategy.
Competitive parity is not the only benefit of Ex-Im. U.S. companies need Ex-Im as an enabler to help funding flow to customers in lesser developed markets, even when default risk is low.
This is a time when American manufacturers are facing keen global competition. While competition on fundamentals like efficiency, skill, and technology, keeps us at our best and drives us to continually improve, many of our competitors receive direct financial support from their governments. Especially at this pivotal time for U.S. manufacturing’s resurgence, it makes no sense to eliminate a valuable tool that allows us to compete on a level playing field.
Ex-Im enjoys clear support from a majority of lawmakers, including from Nevada’s own Sens. Reid (D) and Heller (R). It is our hope that the rest of Congress follows their example of bipartisan support and unifies to reauthorize this vital and common sense, job creating agency.
Hutter is president and CEO of Carson City, Nevada-based Click Bond, Inc.