OPINION: Congress needs to renew Export-Import charter
Nuclear energy offers common ground to both political parties, generating large amounts of electricity while providing jobs, energy security and clean air. But the government's role in the world marketplace, in which the nuclear industry participates, has led to real differences over an institution whose mission is to promote the United States' exports.
Some conservatives in Congress do not want to renew the charter for the Export-Import Bank of the U.S., saying that its mission runs counter to their free market principles. They want the bank to be dismantled when its charter expires on Sept. 30.
Examining how the bank operates and making it work better is one thing, but scrapping the one agency of government that does the most to promote the export of American products and services is quite another.
For the last 80 years, the bank has been supporting exports by providing critical financing when the private sector declines to participate. While large corporations like Boeing Aircraft and General Electric do benefit, 70 percent of the 6,000 firms aided over the past five years have been small businesses, and 90 percent of its recent transactions were for small businesses.
The bank has had an impact nationally, regionally and locally. Last year, the bank's lines of credit supported $37.4 billion in U.S. exports and 205,000 jobs, many of which occurred throughout the Midwest. This includes $32 million in exports by 15 South Dakota companies.
Because its operating expenses are paid by fees and interest from its private customers, the bank costs U.S. taxpayers nothing. In fact, its loan default rate is currently less than one-quarter of 1 percent. As a result, the bank turned a profit last year and paid $1.1 billion to the U.S. Treasury. In other words, the Ex-Im Bank helped to reduce the national debt.
Like it or not, most governments around the world support their exports. Many overseas buyers prefer -- if not require -- that their suppliers have financial assistance from their government. Without an Export-Import Bank, American companies could lose billions of dollars in overseas orders while nations like Brazil, Russia, India and China (the so-called BRIC nations) continue to provide unregulated export financing.
With regard to energy policy, allowing the bank's charter to expire would be a missed opportunity, if not a huge mistake. The rest of the world is demanding the same energy-intensive lifestyle that we enjoy today. If that energy were to come from American-made clean energy technology, we would simultaneously reduce carbon emissions; create more jobs in the U.S.; and boost local, state and federal budgets.
Many of these clean energy jobs would be in engineering and manufacturing. For nuclear energy, we already export items such as pipes, pumps, steam turbines, engineering services and a multitude of components. In the near future, the U.S. could become the world's one-stop shop for advanced systems in nuclear energy, natural gas, wind and solar, biofuels, energy efficiency and clean coal and carbon sequestration.
Ninety-five percent of the world's consumers do not live in the U.S., and their hunger for energy is growing. We should renew the Export-Import Bank's charter to have access to that market and spur economic growth at home.
-- Dr. Robert McTaggart, of Brookings, is an associate professor of physics and coordinator of nuclear education at South Dakota State University.