In my six years serving on the City Council, my office has received thousands of constituent calls regarding various issues. One call, however, that I’ve never received is, “Councilman Lopez, how many jobs have you created today?”
Our residents may not always think about it, but one of the most important responsibilities we are tasked with is creating an atmosphere of economic development and prosperity. As chairman of the city’s Economic and Community Development Committee, I take that responsibility very seriously. The city has multiple resources we utilize to attract businesses to locate here, and encourage small businesses to grow and expand their services. One of those vital resources is the U.S. Export-Import, or Ex-Im, Bank.
Unfortunately, the Export-Import Bank is in serious danger. Losing it would hurt Texas businesses and jobs, and put the country at a competitive disadvantage in the world economy. Congress needs to act now to renew the Ex-Im Bank’s authorization, which officially expired last week.
Momentum had been building in recent weeks against the Ex-Im Bank. Whether that is because of a growing number of lawmakers seeing political gain in advocating for its extinction, ideological purity or a matter of waning days before authorization expired, the simple truth is that Texas and the nation will be harmed if the Ex-Im Bank disappears.
The Ex-Im Bank is the official export credit agency of the United States; it finances and insures foreign purchases of U.S. goods when the private sector is unwilling to accept the risk. In simpler terms, the Ex-Im Bank has provided loans to help American companies sell their products to other countries when no one else will.
Since its creation more than 80 years ago, the Ex-Im Bank supported business and helped create jobs. In 2014 alone, the bank provided financing and guarantees totaling $27.4 billion in U.S. exports, supporting an estimated 164,000 jobs in more than 3,000 companies.
During the past eight years, 1,600 Texas companies, including 867 small businesses, utilized the Ex-Im Bank to facilitate sales totaling more than $30 billion. Locally, 64 San Antonio companies have been supported by the Ex-Im Bank, generating more than $1 billion in export value. In addition, San Antonio’s trade and investment strategy, introduced in December, specifically identifies that a company’s ability to export is a crucial part of its growth strategy, and providing exporting companies access to financing is the single most important component of their ability to increase business and grow.
Billions of dollars in trade and thousands of jobs are at risk if the Ex-Im Bank is not reauthorized. Other countries will gladly fill the void left by the United States’ unilateral retreat. The nearly 60 other countries’ export credit agencies are ready, willing and able to support their own companies.
The benefits of the Ex-Im Bank do not end at job creation and improved opportunity for U.S. business, as the bank actually generates revenue for the U.S. The Ex-Im Bank has responsibly managed its loan portfolio and had a default rate of less than one-fifth of 1 percent in 2014. In the same year, commercial banks’ default rate was 2.1 percent, 12 times larger than the Ex-Im Bank. This responsible management combined with the fees charged for services has generated nearly $7 billion for the U.S. Treasury above and beyond the bank’s costs of operation.
Failure to revive the Ex-Im Bank will cost jobs and put Texas and the country at a competitive disadvantage. Our country faces real and difficult issues that we must address. Eliminating a job-creating and revenue-generating agency is not one of them. Join me in asking our federal elected officials to help San Antonio’s economy by supporting the reauthorizing of the Ex-Im Bank.
Ray Lopez represents District 6 on San Antonio’s City Council.