Boeing battles for bank’s survival

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Boeing is pulling out all the stops in an aggressive campaign to save the Export-Import Bank.

The aerospace giant is employing a high-powered team of lobbyists as it presses lawmakers to reauthorize the 80-year-old agency before its charter expires on Sept. 30.

{mosads}The company has poured $4.18 million into its lobbying operation in recent months, a 6 percent increase over the second quarter of 2013, and has at least 18 lobbyists working on financial services issues alone.

It has also hired two outside lobbying firms, the Gephardt Group and Clark Geduldig Cranford & Nielsen, to push for the bank’s renewal. Both firms worked for Boeing during the last fight over Ex-Im reauthorization in 2012.

Boeing officials have kept up the pressure by sending letters to lawmakers and meeting with members of the Senate Banking and the House Financial Services committees, which have jurisdiction over Ex-Im, according to Boeing spokeswoman Gayla Keller.

The company is also partnering with major business organizations, including the National Association of Manufacturers, in a “very broad coalition” supporting the bank, Keller said.

As the nation’s largest exporter, Boeing is the top beneficiary of Ex-Im financing. The company accounted for more than one-third of the bank’s total loan commitments between 2007 and 2013, according to a July 2014 report from Standard & Poor’s Ratings Services.

Conservative foes of Ex-Im are labeling it the “Bank of Boeing” as they try to persuade lawmakers that the bank is a form of “corporate welfare” that should be abolished.

“The ideological opponents of the bank were much more systematic in pressuring of House Republicans this time around,” said one political adviser to Boeing, who asked not to be named in order to speak more candidly.

And while the business community is broadly behind the bank, there is friction over whether changes should be made to the way it operates.  

Domestic airlines such as Delta want limits on Ex-Im because they say it is boosting foreign competitors.

“Any reauthorization of the Bank must, at a minimum, contain reforms to address this issue, as well as provide complete transparency on any financing in which the bank participates and require it to analyze the benefits and harms of its widebody financings on U.S. airlines and our employees,” said Delta spokesman Trebor Banstetter. 

Players on both sides of the Ex-Im debate expect lawmakers to reach a short-term deal to rescue the bank in September, but Boeing is butting heads with Delta over the details of the reauthorization bill.

Delta wants to stop Ex-Im from providing better than market rates to some foreign airlines when they purchase wide body aircraft. The company says many of the airlines either don’t need the financing or already receive subsidies from their home countries.

Keller argued that Boeing wouldn’t be able to fund the development of new products “if its resources are tied up in financing aircraft sales.”

“Ex-Im is vital to our customers around the world, to our ability to compete successfully, and to create and sustain jobs across Boeing and throughout our U.S. supply chain,” Keller said. “Boeing is and chooses to be an aerospace innovator — not a bank.”

“Ex-Im allows Boeing — as well as thousands of small, medium and large manufacturers across the country — the ability to market and sell our products on their merits in the face of state-subsidized competitors,” she said.

S&P said Boeing would have to secure between $7 billion and $9 billion in private financing if Ex-Im were to close. As of March 2014, Boeing’s financing portfolio was $3.5 billion, according to S&P.

One top Republican strategist who opposes Export-Import reauthorization said Tea Party groups and Delta Airlines — a big business in its own right — have become “strange bedfellows” in the Ex-Im fight.

“Delta has a lot more to gain if Ex-Im is not reauthorized than the Tea Party,” said the strategist, who asked not to be named. “[Delta] changed strategy in 2014 and moved the debate outside of Washington D.C.,” the Ex-Im critic said, “where they wisely brought it to voters’ attention on Main Street.”

The strategist said Delta realized it “couldn’t compete” with the lobbying muscle of Boeing and other Ex-Im beneficiaries such as General Electric and Caterpillar, and has shifted strategy accordingly.

Still, Delta has hired additional lobbyists for the Ex-Im fight, including the K Street firms Capitol Counsel and Elmendorf Ryan.

Lobbyists now working for Delta include Josh Kardon, former chief of staff to Sen. Ron Wyden (D-Ore.); Kyle Nevins, who was deputy chief of staff to former House Majority Leader Eric Cantor (R-Va.); and John O’Neil, former counsel to GOP whip Trent Lott.

The Boeing adviser said Delta Airlines has “been more aggressive both in its lobbying as well as in its broader public relations campaign” this year as it seeks changes to the way Ex-Im operates.

Conservative groups said the escalation of the campaign against Ex-Im is by design.

“The purpose of the 2012 debate was to lay the groundwork for ending the Bank this time around, so the increased intensity was expected,” said Dan Holler, spokesman for Heritage Action, one of the top Tea Party groups opposing Ex-Im.

Tags Eric Cantor Ron Wyden

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