Koch Industries told lawmakers to oppose reauthorizing the Export-Import Bank in a letter sent to Congress on Tuesday and obtained by The Hill.
Philip Ellender, president of government and public affairs at Koch Companies Public Sector, wrote in the letter that “the Ex-Im bank is yet another example of the government intervening in the market to pick winners and losers.”
{mosads}The letter follows public opposition from likely 2016 GOP presidential candidates, including former Florida Gov. Jeb Bush and Wisconsin Gov. Scott Walker.
Congress must reauthorize the Bank before June 30 or it will shut down. Many hard-line conservatives oppose the bank, calling it tantamount to “corporate welfare” and “cronyism.”
But moderate Republicans and Democrats say that the bank helps sustain U.S. jobs by backing American companies’ international work in markets where the private sector won’t finance projects.
Koch Industries — headed by billionaire conservatives Charles and David Koch — disagrees.
“It confers benefits granted by the American people as a whole to a small number of well-connected corporations,” Ellender wrote in the letter. “It socializes the risk of economic activity while benefiting relatively few companies. We respectfully ask Congress to allow the Ex-Im Bank to expire.”
Koch Industries and its subsidiaries have utilized the Bank’s financing in the past. According to Ex-Im records, between 2007 and 2015, Houston-based Koch Heat Transfer Company received financing from the bank on a deal worth $403,399. A Koch Industries Inc. business in Wichita received $183,105 in financing during the same time period.
Meanwhile, Koch subsidiaries Georgia Pacific in Atlanta and Molex Company in Athens received $701,493 and $263,193, respectively, in financing between 2007 and 2015, according to Ex-Im records.
A Koch spokesperson told The Hill that Koch has “consistently opposed government-funded subsidies and incentives, and will continue to do so.”
“We play by the rules, so where government incentives are already in place, our businesses participate,” the Koch spokesperson told The Hill.
Kevin Varney, a former Treasury and White House official working to reauthorize the bank, noted Koch’s ties with Tea Party politics.
“Tea Party economics is nothing more than the triumph of ideology over experience,” Varney, now with D.C. consulting firm 32 Advisors, told The Hill.
Varney said that “the Koch brothers and the Chinese government both believe that the getting the U.S. government — and U.S. companies — out of the international marketplace is a good idea.”
“Good for who? Not for U.S. jobs or U.S. workers,” Varney said.
In the letter, Ellender noted that then-Sen. Barack Obama dubbed Ex-Im “little more than a fund for corporate welfare” while campaigning during the 2008 election cycle. Obama has since urged reauthorization.
“As the failures of Fannie Mae and Freddie Mac make clear, using taxpayer dollars to subsidize corporations rarely results in benefits for society at large,” Ellender wrote.
“And we stand by Congressman Jeb Hensarling of Texas [R], who notes there is little hope for reform of the social entitlement programs that threaten to bankrupt our country if we are not also willing to reform corporate entitlement programs.”
House Democrats and Republicans have introduced separate proposals that would reauthorize the bank. But Hensarling hasn’t said whether he will move a bill through his panel, which has jurisdiction on the issue.
Most Ex-Im watchers believe that, should a reauthorization bill be brought to the floor, it would pass both chambers. Sens. Mark Kirk (R-Ill.) and Joe Manchin (D-W.Va.) are working on a bill in the upper chamber.
“We oppose ALL subsidies, whether existing or proposed, including programs that benefit us, which are principally those that are embedded in our economy, such as mandates. We do not believe government should be picking ‘winners and losers’ by subsidizing or mandating certain industries or products,” Ellender wrote.
“The record at doing so – both here and abroad – is abysmal, causing the loss of jobs, the waste of resources and erosion of confidence in the fairness of both government and business in America.”
On Friday, Ex-Im President Fred Hochberg will be in Tulsa, Okla., along with Oklahoma Gov. Mary Fallin (R) and GOP Reps. Frank Lucas (Okla.) and Markwayne Mullin (Okla.) to discuss Ex-Im’s impact on some of the state’s businesses.
This story was updated at 6:03 p.m.