When he ran for president in 2008, then-Sen. Barack Obama said the U.S. could afford to eliminate some of its government programs. Among them was the Export-Import Bank “that’s become little more than a fund for corporate welfare,” Obama said at a Wisconsin campaign event.

On Tuesday, General Electric Co. announced it planned to move 500 U.S. jobs overseas — including 80 at its Bangor plant, which manufactures steam and gas turbine components — because Congress allowed the Ex-Im Bank’s authority to lapse on July 1, preventing the agency from issuing needed financing for U.S. exports.

Reacting to the news, Republican Rep. Bruce Poliquin from Maine’s 2nd District — just as Obama did seven years ago — characterized the Ex-Im Bank as a purveyor of “corporate welfare.”

The political tables have turned when it comes to the 80-year-old Ex-Im Bank, the country’s official export credit agency. The Obama administration has been pressing for Congress to reauthorize the bank while a group of conservative Republicans in the House, including Poliquin, have kept that from happening.

The Ex-Im Bank issues loans to foreign buyers of U.S.-made products, guarantees private-sector loans made for the same purpose and offers insurance designed to protect U.S. exporters from nonpayment by their customers. Oftentimes, as in GE’s situation, overseas customers demand the ability to obtain such financing as a condition of doing business. That means exporters from countries with functioning export credit agencies — such as France, where GE says it will move the work being performed in Bangor — have a leg up in securing international business.

It’s easy, on the surface, to see the Ex-Im Bank as an outpost of corporate welfare. Those clamoring for the bank’s reauthorization are some of the U.S.’s largest businesses — Boeing, Cargill, Caterpillar and GE, for example — and the U.S. Chamber of Commerce, which represents their interests. And three-quarters of the value of the agency’s direct loans, loan guarantees and credit insurance in 2014 flowed to large businesses, according to Ex-Im’s annual report.

Critics, such as Poliquin, have also pointed to fraud and corruption within the agency, and they’ve made the argument that there’s no need for government intervention in the free market through the Ex-Im Bank.

But the reasons for allowing the Ex-Im Bank to continue to wallow don’t stand up — especially now, as U.S. companies can point to business lost and jobs eliminated because of the lapse in the bank’s authority.

Economists generally agree that the Ex-Im Bank doesn’t have a substantial economic impact or a huge effect in reducing the U.S.’s trade deficit. But the program costs the U.S. government nothing to run: In fact, it generated a $674.7 million surplus last fiscal year, which it returned to the U.S. Treasury to reduce deficits. Over the past two decades, it’s generated nearly $7 billion in surpluses over the past two decades. Over the past five years, the bank has cut its operating budget by 19 percent, leaving more fee and interest revenue to turn over to the Treasury.

For the cost of nothing to U.S. taxpayers, the Ex-Im Bank offers businesses a basic and oftentimes critical service, which allows them to export into new markets and support manufacturing jobs back home. While the value of its portfolio is heavily weighted to large businesses, nearly 90 percent of the businesses that used the bank’s services in 2014 were small businesses.

In addition, the Ex-Im Bank’s operations have notably improved in recent years. In fiscal year 2014, the default rate on Ex-Im Bank financing dropped to 0.175 percent, down from 0.6 percent in fiscal year 2010. Part of the improvement is because of the Ex-Im Bank’s inspector general office — established in 2007 — kicking into high gear. In the past five years, inspector general audits and investigations have resulted in $255 million in repayments to the bank and $127 million in avoided transactions — 25 times the size of the office’s budget.

Tuesday’s announcement that GE planned to cut 80 jobs in Bangor was just further evidence that the U.S. — including Maine — has much more to lose from letting the Ex-Im Bank vanish than it has to gain.

Avatar photo

The BDN Editorial Board

The Bangor Daily News editorial board members are Publisher Richard J. Warren, Opinion Editor Susan Young, Deputy Opinion Editor Matt Junker and BDN President Todd Benoit. Young has worked for the BDN...