Both Wisconsin Gov. Scott Walker and U.S. Sen. Ted Cruz are campaigning in Dallas and Fort Worth this week.
Texans should ask Cruz, in particular, some questions.
Why is a senator from a strongly pro-business state like Texas against reauthorizing the charter for the government-owned U.S. Export-Import Bank, which provides favorable loans and insurance services that help U.S. companies compete overseas?
Until last week, Cruz and some other Republican presidential candidates, including Walker, were able to dismiss the Ex-Im Bank as unfair, using loaded political buzzwords such as “cronyism” and “corporate welfare.”
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Now that General Electric Co. has scratched DFW as a potential headquarters site over what Bloomberg News described as Texas’ “unfavorable” political climate, Texans see what the Ex-Im Bank is really about: growth, jobs and success for Texas’ major employers and new employers.
Officials at Connecticut-based General Electric made no formal comment. But Bloomberg reported that officials close to the search said Texas had been ruled out over lawmakers’ Ex-Im Bank opposition, despite the best efforts of Gov. Greg Abbott.
GE Transportation already has a new locomotive factory at AllianceTexas in Fort Worth, which relies heavily on state and local government incentives to draw businesses that promote jobs and economic growth across North Texas.
Imagine if GE moved its corporate headquarters and 800 more jobs to North Texas, or brought along its GE Capital finance division and 4,000 jobs.
But GE is also one of the large manufacturers that rely heavily on financing from the Ex-Im Bank, so the company’s growth at AllianceTexas or anywhere in the U.S. depends in part on bringing back Ex-Im loans.
Congress let the bank’s charter expire June 30 after 81 years.
Cruz has described the Ex-Im Bank as the “corrupt” work of a “Washington cartel” and an example of government favoritism toward certain big employers.
According to Bloomberg, GE’s rejection of North Texas is directed more at U.S. Rep. Jeb Hensarling, chairman of the House Committee on Financial Services, than at Cruz.
But Cruz’s vociferous opposition to the Ex-Im Bank and to business assistance in general can only hurt Texas, the No. 2 benefactor of Ex-Im financing (behind Washington state), and Tarrant County.
The Texas Association of Business and Texas Association of Manufacturers have strongly supported renewing the Ex-Im Bank’s charter.
Texas companies lead the U.S. in exports and “need every tool” to compete globally, association Presidents Chris Wallace and Tony Bennett wrote in a joint statement:
“It’s baffling that members of Congress have chosen ideology over jobs supported by Ex-Im, one of the most important tools we have to support exports. Their actions will deliberately harm Texas.”
True, if GE has rejected DFW, it might be over other considerations, or as a ploy to gain political leverage in Congress or in another state.
But the possibility alone should worry Texans.