Schumer Pushes to Preserve Export-Import Bank, One of LI’s Most Important Fed. Job-Creation Programs
Washington, DC - July 18, 2014 - Today, U.S. Senator Charles E. Schumer launched his push to preserve the Export-Import (Ex-Im) Bank, which helps support hundreds of jobs and over $57 million in 2013 sales for companies on Long Island, like d’Addario, Love & Quiches Gourmet and Seal Dynamics. Schumer explained that the Ex-Im Bank provides financing to foreign companies in order to help them purchase U.S. goods, and in other cases the Ex-Im bank can insure receivables for U.S. companies. Overall, there are 20 Long Island businesses that benefitted from the Ex-Im bank on Long Island last year, and many others have benefited in other years. Unfortunately, the Ex-Im Bank is set to expire in September if Congress does not act, and Schumer said that this would deal a significant blow for the dozens of companies on Long Island who rely on the bank to export their products and to compete in the world-wide marketplace . Schumer said that the Ex-Im Bank is a major driver of economic growth and manufacturing jobs, and it is important that Congress does not let it expire.
“The Ex-Im Bank is one of the key tools we have in our toolbox for supporting and growing manufacturing jobs on Long Island and across New York State, which is why letting the Bank expire is simply not an option,” said Senator Schumer. “Dozens of companies throughout Nassau and Suffolk counties – from commercial bakers to musical instrument suppliers – directly or indirectly benefit from the Ex-Im Bank and employ thousands of people as a result. Extending the Ex-Im Bank’s charter will reassure these businesses that the federal government is on their side and make it clear that we will do all we can to help level the playing field for doing business abroad so these companies can support manufacturing jobs back home.”
“D’Addario has a customer in Mexico who uses Ex-Im Bank to finance its purchases with us, accounting for approximately $1 million in sales on an annual basis. Without Ex-Im Bank, our customer would have to pre-pay or find another source of financing. If Ex-Im Bank is not reauthorized, D’Addario could lose an important source of revenue in the North American market,” said John D’Addario III, President of D’Addario & Co., Inc.
“With the assistance of Ex-Im Bank, Love & Quiches Gourmet has been able to consistently grow our export business since shipping our first cheesecake abroad 25 years ago. Their services have allowed us to employ hundreds of US employees, produce our products here, buy ingredients and supplies from US companies, pay our rent here and sell our products all around the world,” said Susan Axelrod, the Chairwoman and Founder of Love and Quiches Gourmet.
Schumer explained that The Ex-Im Bank is an independent federal government agency that plays an important role in the U.S. economy by helping foreign customers buy American-made products and equipment from small- to large businesses across New York State. In some cases, the Ex-Im Bank also helps provide financing directly to U.S. companies that enables them to export manufactured goods and services, all with the objective of contributing to U.S. employment.
Some examples of Long Island companies supported by the Export-Import Bank include Seal Dynamics in Hauppauge, D’addario & Company in Farmingdale, Kiss Nail Products in Port Washington, and Good Health Natural Foods in Northport. In some cases, the Ex-Im Bank also helps provide financing or insurance, as it does for Love and Quiches Gourmet, directly to U.S. companies.
Schumer explained that authorization for the Ex-Im Bank will expire on September 30th, and if Congress does not reauthorize the bank, it could affect companies all across New York and on Long Island. According to Ex-Im Bank data, there are 270 businesses in the state of New York that directly benefited from Ex-Im Bank between 2007 and 2014; 163 of those are small businesses. In 2013 there were 20 companies on Long Island, 17 of which are small businesses; all of these businesses utilize this bank to more easily sell products to overseas customers. This is a steady increase from the 236 overall exporters in New York recorded just five years ago in 2009. The bank has supported $6 billion in New York exports over the last five years, including approximately $682 million on Long Island during that same time period.
In total, the bank supports over 200,000 jobs each year at no cost to the U.S. taxpayer, which means 1.2 million American jobs in the past five years. In FY2013, the Ex-Im Bank supported $37.4 billion in American exports, and small business accounted for nearly 90 percent of the bank’s transactions. Schumer also noted that what is not captured in all of these statistics is the myriad local suppliers and vendors that also benefit from the Ex-Im Bank. Even though they are not the direct beneficiary of financing, they indirectly benefit because it helps keep companies they supply to strong and growing.
Schumer said that not only does is the Ex-Im Bank help support a major job-creation, but it also helps put American businesses on a level playing field; U.S. exporters are often met by competition from foreign companies overseas that have a clear leg up because they are backed or wholly-owned by foreign governments. Through direct loan, loan guarantee, and insurance programs, Ex-Im Bank helps lessen risk for foreign buyers so that they may more easily purchase U.S. products, helping U.S. companies expand their businesses and sell their products all over the world.
If the Ex-Im Bank is not reauthorized, Schumer said, many of these companies would have to find alternative means of leveling the playing field and selling products overseas. Because many of these companies face competition overseas from countries that sponsor and heavily subsidize assist their foreign exporters, U.S. companies would be at a severe disadvantage. Many of these New York companies could face a severe decline in business, which could lead to layoffs and fewer employment opportunities, particularly in the field of manufacturing for residents. Countries like China, Japan and Germany all have much larger export credit agencies that receive government backing, and failure to reauthorize this U.S. institution is projected to shave 1% off of U.S. GDP growth per year for the first few years. A shutdown of the Ex-Im Bank could then lead to even greater GDP decline going forward, as companies here in the U.S. might be forced to relocate production overseas as an alternative to competing with foreign markets.
Currently, Congress is debating the reauthorization of the Charter that allows the Ex-Im Bank to operate and continue to help American businesses. Extending this charter will renew Ex-Im Bank’s authority. Legislation was enacted in the 112th Congress to extend Ex-Im Bank's authority through the close of business on September 30, 2014. With August recess just around the corner, Schumer is urging both his Democrat and Republican colleagues to not wait on this reauthorization, as any lapse would be a detriment to businesses on Long Island and the rest of New York.