NPI's Cascadia Advocate

Offering commentary and analysis from Washington, Oregon, and Idaho, The Cascadia Advocate is the Northwest Progressive Institute's unconventional perspective on world, national, and local politics.

Monday, March 7th, 2016

Bernie opposes Ex-Im. Will it “cost him” in Washington State’s Democratic caucuses? No.

Last night’s Demo­c­ra­t­ic pres­i­den­tial debate between Hillary Clin­ton and Bernie Sanders includ­ed a lengthy exchange over an issue of con­cern to Wash­ing­ton State’s polit­i­cal lead­er­ship: the Export-Import (Ex-Im) Bank, which mem­bers of Wash­ing­ton’s con­gres­sion­al del­e­ga­tion fought hard to pro­tect and then to reau­tho­rize after Repub­li­cans shame­ful­ly allowed its char­ter to expire.

The can­di­dates dis­agree over whether the bank is a good idea. Hillary Clin­ton sup­ports it; Bernie Sanders oppos­es it. Each can­di­date spoke to their posi­tion around mid­way through the debate, as we can see from the tran­script (be warned, in the inter­est of offer­ing fuller con­text, this is going to be a lengthy excerpt):

CLINTON: You know, if we’re going to argue about the 1990s instead of talk­ing about the future, which I’d much pre­fer because I think every elec­tion is about the future, and you all deserve to know what we will do to help you have a brighter future — but, if we are going to talk about the 1990s, I think it’s only fair to say that at the end of the 1990s, after two terms of my hus­band’s pres­i­den­cy, the unem­ploy­ment rate in Michi­gan was 4.4 per­cent.

There had been a net increase of 54,000 man­u­fac­tur­ing jobs. There had been a net increase of 653,000 jobs over­all.

And, one of the ways jobs were brought to, and grown here in Michi­gan was through some­thing called the Export-Import Bank which helped a lot of busi­ness­es, par­tic­u­lar­ly small busi­ness­es, be able to export around the world.

Sen­a­tor Sanders oppos­es that. I think we’re in a race for exports. I think Chi­na, Ger­many, every­body else sup­ports their busi­ness­es. Here in Michi­gan there’s been $11 bil­lion dol­lars in recent years used to sup­port exports, pri­mar­i­ly from small busi­ness­es.

I favor that, he’s opposed it. I want to do every­thing I can for us to com­pete and win in the glob­al econ­o­my…

COOPER: Sen­a­tor Sanders…

CLINTON: … and that’s what I will do as pres­i­dent…

COOPER: I just want to explain to view­ers what the Export- Import Bank is, in case every­body is not quite as wonk­ish as every­body on this stage here. The Export-Import Bank, it’s a fed­er­al agency, it gives loans to com­pa­nies that export Amer­i­can prod­ucts. Sen­a­tor Sanders, you do oppose it. The vast major­i­ty of the bank’s cus­tomers are small busi­ness­es, 176 right here in Michi­gan.

What do you say to small busi­ness own­ers.…

SANDERS: I’ll tell you what I say…

COOPER: Who rely on the bank to make their com­pa­ny prof­itable…

SANDERS: I’ll tell you what I say. Do you know what the oth­er name of the Export-Import Bank is? What it’s called in Wash­ing­ton [D.C.]? It’s called the bank of Boe­ing because Boe­ing itself gets 40 per­cent of the mon­ey dis­charged by the Export-Import Bank.

Sev­en­ty-five per­cent of the funds going from the fed­er­al gov­ern­ment, the Export-Import Bank, goes to large, prof­itable cor­po­ra­tions. Many of these cor­po­ra­tions have shut down in Amer­i­ca, and have gone abroad to exploit poor peo­ple.

You know what? I don’t think it’s a great idea for the Amer­i­can tax­pay­er to have to sub­si­dize through cor­po­rate wel­fare prof­itable cor­po­ra­tions who down­size in the Unit­ed States of Amer­i­ca.

COOPER: Sen­a­tor…

SANDERS: Sev­en­ty-Five per­cent of that mon­ey goes to large prof­itable cor­po­ra­tions.

COOPER: Sen­a­tor Sanders, you are the only mem­ber of the Demo­c­ra­t­ic cau­cus to vote against it. You’re agree­ing with Sen­a­tor Ted Cruz on this, why is he right and the Democ­rats wrong?

SANDERS: Well, let me tell you, I don’t want to break the bad news.

(LAUGHTER)

SANDERS: Democ­rats are not always right. Democ­rats have often sup­port­ed cor­po­rate wel­fare…

(APPLAUSE)

SANDERS: Democ­rats have sup­port­ed dis­as­trous trade agree­ments, but on this issue I do not believe in cor­po­rate wel­fare, and in fact, Sec­re­tary Clin­ton may know or not know, but as a mem­ber of the Finan­cial Ser­vices Com­mit­tee, I worked hard and suc­cess­ful­ly to make sure that at least 20 per­cent of the mon­ey went to small busi­ness­es which is where it should go and not to prof­itable cor­po­ra­tions and down­siz­ing in our coun­try.

COOPER: Sec­re­tary Clin­ton?

CLINTON: When I trav­eled around the world on your behalf as Sec­re­tary of State and went to 112 coun­tries, one thing I saw every­where was how Euro­pean and Asian coun­tries were sup­port­ing their com­pa­nies back in their coun­tries, to be able to make sales and con­tracts in a lot of the rest of the world. In fact, with­out the export-import bank, sup­port­ing busi­ness­es of all sizes — I believe more jobs would be lost here at home and more jobs lit­er­al­ly would be export­ed. Instead of export­ing prod­ucts, we would be export­ing jobs.

I just believe that Sen­a­tor Sanders took that lone­ly posi­tion because most of us who saw the results — I saw it as a sen­a­tor from New York. Your Sen­a­tors saw it here in Michi­gan. They can give you the names of 240 com­pa­nies in Michi­gan that have been helped.

There is a com­pa­ny in Lev­o­nia being helped, there are com­pa­nies all over this state. I know, if we are going to com­pete and win in the glob­al econ­o­my, we can’t let every oth­er coun­try sup­port their com­pa­nies and we take a hands off approach. I will not agree with that.

COOPER: I’m going to let you respond but I just want to push back on this. Sen­a­tor Sanders is cor­rect, the major­i­ty of the mon­ey does go Boe­ing, does go to com­pa­nies like Cater­pil­lar.

Do they need this mon­ey?

CLINTON: I will tell you what, Ander­son, after I inves­ti­gat­ed it, I con­clud­ed they did and here’s why. There two big plane man­u­fac­tur­ers in the world, there’s Air­bus and Boe­ing. Air­bus does every­thing it can to get con­tracts to sell planes every­where in the world. We don’t have as quite an aggres­sive out­reach from our gov­ern­ment.

I did go in many places around the world to sell Amer­i­can prod­ucts because the alter­na­tives were usu­al­ly Euro­pean, Asian, pri­mar­i­ly Chi­nese prod­ucts. That to me was an unac­cept­able con­ces­sion.

So yes, Boe­ing and oth­er big com­pa­nies get sup­port just like their com­peti­tors do from the com­pa­nies that they are from in the coun­tries that pro­vide the sup­port.

COOPER: Thank you.

Sen­a­tor Sanders?

SANDERS: Isn’t it trag­ic that the large multi­na­tion­al cor­po­ra­tions mak­ing bil­lions of dol­lars a year, shut­ting down in Amer­i­ca, going to Chi­na, going to Mex­i­co? Absolute­ly they need a hand­out from the Amer­i­can mid­dle class — I don’t think so.

It should be not­ed that the Export-Import Bank does­n’t mere­ly ben­e­fit large com­pa­nies like Boe­ing and Cater­pil­lar. It also ben­e­fits small busi­ness­es that export goods to for­eign mar­kets. Oth­er coun­tries help their com­pa­nies make sales by pro­vid­ing financ­ing, includ­ing the Euro­pean coun­tries where Air­bus does busi­ness. Why should­n’t the Unit­ed States of Amer­i­ca help its com­pa­nies?

“In FY 2015, near­ly 90 per­cent of EXIM Bank’s trans­ac­tions — more than 2,300 — direct­ly sup­port­ed Amer­i­can small busi­ness­es,” says a fact sheet on Ex-Im’s web­site.

It should also be not­ed hat Ex-Im actu­al­ly gen­er­ates mon­ey for the Unit­ed States Trea­sury. As the fact sheet also says: “Over the past two decades, the Bank has gen­er­at­ed near­ly $7 bil­lion more than the cost of its oper­a­tions. That’s mon­ey EXIM Bank gen­er­ates for the Amer­i­can tax­pay­er, to help reduce the fed­er­al deficit.”

In our view, the Export-Import Bank is a valu­able pub­lic ser­vice that the fed­er­al gov­ern­ment pro­vides to Amer­i­can busi­ness­es large and small. We sup­port it.

Bernie Sanders does not sup­port Ex-Im. That may both­er Wash­ing­ton State’s polit­i­cal lead­er­ship and edi­to­r­i­al boards. But will it cost Sanders sup­port in the upcom­ing Demo­c­ra­t­ic pres­i­den­tial precinct cau­cus­es on March 26th, as the Seat­tle Post-Intel­li­gencer’s Joel Con­nel­ly has sug­gest­ed? We don’t think so.

The basis for our belief is sim­ple.

Ex-Im mat­ters to many Wash­ing­to­ni­ans, but we’re guess­ing most cau­cus­go­ers will be cau­cus­ing for the can­di­date who they trust and iden­ti­fy with, in spite of any dis­agree­ments they may have with the can­di­dates on the issues.

That’s usu­al­ly the way it is. The issues are cer­tain­ly rel­e­vant to informed vot­ers, but issues sim­ply don’t dri­ve vot­ing deci­sions for most folks. Trust does. Peo­ple vote their val­ues, and they vote their iden­ti­ty. Authen­tic­i­ty mat­ters.

There’s no evi­dence that sug­gests that any sig­nif­i­cant num­ber of peo­ple decide who to vote for by pulling out score­cards when they fill out bal­lots, and run­ning through a laun­dry list of issue posi­tions before cal­cu­lat­ing who they’ll fill in the oval for.

Fur­ther­more, Wash­ing­ton State’s Demo­c­ra­t­ic cau­cus­es are an exer­cise in grass­roots pol­i­tics. Wash­ing­ton State’s edi­to­r­i­al boards and busi­ness elites don’t con­trol the out­come — Demo­c­ra­t­ic vot­ers and Demo­c­ra­t­ic activists do, as they should!

In 2008, most of Wash­ing­ton State’s polit­i­cal lead­er­ship (includ­ing the superdel­e­gates) backed Hillary Clin­ton. She enjoyed the endorse­ments of Jay Inslee, Pat­ty Mur­ray, Maria Cantwell, Gary Locke, Ron Sims, and more.

Barack Oba­ma was able to secure the sup­port of Adam Smith, Greg Nick­els, and then-Gov­er­nor Chris Gre­goire, but Clin­ton def­i­nite­ly had more elect­ed lead­ers in her camp. Did it help Clin­ton ride to vic­to­ry? Nope. Oba­ma won a deci­sive vic­to­ry in Wash­ing­ton. He swept the state, and cap­tured most of Wash­ing­ton’s del­e­gates.

Oba­ma’s string of Feb­ru­ary vic­to­ries, which includ­ed his tri­umph here in Wash­ing­ton, gave him momen­tum and cru­cial del­e­gates. It made all the dif­fer­ence in the end, because Clin­ton kept com­pet­ing through March, April, and May, only bring­ing her cam­paign to an end in June when Oba­ma clinched the nom­i­na­tion.

This time around, Wash­ing­ton State’s polit­i­cal lead­ers are again most­ly in Hillary Clin­ton’s cor­ner. But that does not mean Clin­ton will be vic­to­ri­ous. The fate of the cau­cus­es will be deter­mined by the vot­ers and activists who show up. It’s smart that Clin­ton and Sanders have each opened offices here, and hired staff in an effort to get their sup­port­ers out on March 26th. May the best can­di­date win!

And, to those who pas­sion­ate­ly sup­port Ex-Im and care about its future, we offer this advice: You’re bet­ter served work­ing to edu­cate Bernie Sanders about Ex-Im’s val­ue than try­ing to use his cur­rent posi­tion against him. If he hap­pens to become the nom­i­nee, it’s going to be impor­tant for our state that he rethink his posi­tion.

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5 Comments

  1. I agree with Sanders and see nowhere that he oppos­es the help to small busi­ness. He is right, the big busi­ness­es take and take and take. I think that using the small busi­ness angle to sell this is a magi­cians slight of hand. Look over here, not what I am doing over there.

    # by Donald Hedden :: March 7th, 2016 at 3:54 PM
    • Don­ald, had the bank’s char­ter not been reau­tho­rized, there are small busi­ness­es right here in Wash­ing­ton State that would have been neg­a­tive­ly affect­ed.

      In Feb­ru­ary of 2015, Sen­a­tor Maria Cantwell’s office report­ed, “The Export-Import Bank sup­ports more than 180 exporters in Wash­ing­ton state, two-thirds of which are small busi­ness­es. About 85,000 jobs in Wash­ing­ton state are sup­port­ed by sales involv­ing Ex-Im Bank financ­ing. Nation­wide, it has sup­port­ed $233 bil­lion in exports since 2007.”

      You read the part about how Ex-Im returns mon­ey to the U.S. Trea­sury, I hope? This isn’t an instance of big busi­ness­es tak­ing, tak­ing, and tak­ing. We, the tax­pay­ers, get some­thing in return. And unlike the bank bailout, Ex-Im is not a blank check. Busi­ness­es must qual­i­fy for financ­ing.

      I sug­gest you read this Wash­ing­ton Post arti­cle (The Ex-Im Bank bat­tle is per­son­al for these small busi­ness own­ers).

      You may not per­son­al­ly know small busi­ness own­ers who ben­e­fit from Ex-Im, but they exist, I can assure you.

      # by Andrew :: March 7th, 2016 at 4:17 PM
  2. Poor Boe­ing, first they lose the wind­fall from the Export Import bank, next thing you know they’ll lose all those bil­lions in free Wash­ing­ton tax­pay­er mon­ey that they don’t have to pay in tax­es in exchange for them NOT mak­ing planes in WA and for ship­ping WA jobs to SC and else­where. What’s a bil­lion dol­lar behe­moth to do? Do you want their CEO to lose his bil­lion dol­lar gold­en para­chute? Seri­ous­ly now! Think of the CEOs. #cor­po­ratismftw

    # by Keith Tyler :: March 7th, 2016 at 9:08 PM
  3. On Boe­ing — they are not a man­u­fac­tur­er.

    They are an assem­bler. Most of their sup­pli­ers are small busi­ness­es.

    What would hap­pen if Ex-Im is killed but Coface who sup­ports Air­bus lives?

    Boe­ing will sur­vive (of course), but they will mere­ly shift it’s sup­pli­ers from USA based ones (which US Con­tent is required for Ex-Im Bank sup­port) to sup­pli­ers OUTSIDE of the US. There­by get­ting sup­port from the likes of the French, the Ger­mans and oth­ers.

    So Kill the Ex-Im Bank — Boe­ing will sur­vive, but it’s small busi­ness sup­pli­ers will be be put out of busi­ness.

    It’s that sim­ple.

    # by Alfred :: March 8th, 2016 at 9:56 AM
  4. It should be not­ed that the buy­ers pay fees to Ex-Im Bank for the loans that they acquire. They are not sub­si­dized, as Sen. Sanders charges. The fees (and inter­est charged on Ex-Im direct loans) go to form the reserves need­ed to cov­er the few loans that go into default. The fees also form the basis of the sur­plus funds that Ex-Im sends to the Trea­sury that reduces the fed­er­al deficit. What’s not to like? Also, big busi­ness­es ben­e­fit from larg­er loans, but in terms of NUMBERS of loans, it’s small busi­ness­es that ben­e­fit the most of Ex-Im’s export sup­port.

    # by Phil Cee :: March 9th, 2016 at 6:04 PM