WASHINGTON, D.C. — President Donald Trump has gone back on his promise not to allow the Export-Import  Bank of the United States (EXIM) to go forward, after a meeting with a lobbyist for and former executive of the top beneficiary of the publicly funded bank’s largesse, Boeing Corp.

 

According to multiple published reports, Trump nominated former Republican legislator Scott Garrett as president of EXIM on April 14, and named another former Congressman, Spencer Bachus, to be a member of its board of directors. However, because Garrett has spoken out against the EXIM bank as a legislator, his appointment has left some confusion as to whether his appointment is good or bad for the institution.

 

The vacancies in these positions have prevented the taxpayer-supported bank from having a quorum and being able to act on loans over $10 million, according to an April 14 report by Reuters.

 

The EXIM bank provides loans to foreign entities that enable them to buy American-made goods; however, critics of the bank charge that this amounts to crony capitalism, costs American jobs and “picks winners and losers” in the marketplace.

 

According to the Reuters article, Trump’s reversal came after a meeting with former Boeing Chief Executive Jim McNerney, who left the company last year but oversaw the company’s aggressive lobbying effort in support of the bank in 2015. Other reports say Trump’s reversal has been ongoing since at least February.

 

During the 2016 campaign Trump called the bank’s activities “featherbedding” for wealthy corporations; however, last week he told The Wall Street Journal that EXIM helps small businesses and creates jobs. According to information provided by the Mercatus Center at George Mason University, Boeing is the top recipient of EXIM bank funding, at 40 percent. Two other top recipients are Caterpillar and General Electric. According to the bank, EXIM is self-sustaining and has made money for taxpayers.

 

That is a matter of some dispute, though, since whether the bank makes a profit for taxpayers or costs them money depends on the accounting method used, according to a recent Washington Post report. Other critics of EXIM say the bank costs American jobs by creating an uneven playing field in the global marketplace. Recent EXIM bank loans made to Caterpillar and GE amounting to $650 million to help a mining project in Australia, for example, have been much criticized for the potential to distort the marketplace and hurt American workers.

 

“My grandfather worked 1,500 feet underground as a miner, and countless other men and women in northern Minnesota have worked hard providing iron ore to the world,” said Sen. Amy Klobuchar, a Democrat from Minnesota, in July 2013.

 

“It doesn’t make sense for our government to be funding our competition, especially when this project could have such a negative impact on local economies and the livelihoods of so many miners.”

 

Other groups extol the EXIM bank as supportive of American jobs. In a June 2014 letter to Congress, Chambers of Commerce and other groups said EXIM does directly support American jobs without costing the U.S. taxpayer anything. EXIM’s charter was set to expire that September. “EXIM charges fees for its services, follows rigorous accounting and risk-management standards, and its loans are often backed by the collateral of the goods being exported,” the letter stated. “As a result, EXIM’s default rate has consistently been less than 2 percent over the past eight decades, a default rate lower than commercial banks.”

 

Most of the 865 signatories are manufacturers. Only two national farm groups signed the letter, including National Council of Farmer Cooperatives and the National Grain and Feed Assoc. One of the few other agricultural businesses on the list was Zeeland Farm Services of Zeeland, Mich.

 

Although farmer groups have access to other taxpayer-supported organizations that help them market their products outside the country, EXIM impacts the agriculture sector to some extent through aid it provides to agricultural equipment manufacturers.