Fiscal conservatives came up short in what they called a battle against corporate welfare as the Senate on Tuesday joined the House in reauthorizing the charter of the Export-Import Bank, which aids U.S. companies seeking to sell goods and services abroad.
The bill, which President Obama is expected to sign, also raises the independent federal agency's lending cap from the current $100 billion to $140 billion. The vote was 78-20, as lawmakers turned back a string of Republican amendments to curb or abolish the bank.
The bank, which has been renewed several dozen times with little notice since it was established in 1934, became caught this year between business groups that strongly support it and conservative organizations, such as Club for Growth, that said the bank is market-distorting and should be abolished.
A side issue has been the split between supporters of Boeing Co., the Ex-Im Bank's largest beneficiary, and Delta Air Lines, which has claimed that its bottom line has been hurt because its foreign competitors, such as Air India, have used Ex-Im financing to buy Boeing's newest aircraft.
Without congressional action, the bank's charter would have expired at the end of this month. It is also close to going over its lending cap.
The vote, said bank Chairman and President Fred P. Hochberg, "gives our exporters a clear signal that we are there for them and that they will have a reliable Ex-Im Bank."
The bank, which takes no money from taxpayers, last year provided export-financing support for about 2 percent of U.S. exports, about $32 billion in loans, loan guarantees and credit financing. Some $11 billion of that supported Boeing sales of large commercial aircraft.
Countering critics who say it is "Boeing's bank," the bank says that 87 percent of its transactions last year directly benefited small businesses and that its financing supported 290,000 jobs, including 85,000 in the aerospace industry.
"Failure to reauthorize the Ex-Im would amount to unilateral disarmament and cost tens of thousands of American jobs," the U.S. Chamber of Commerce said in a letter to senators, noting that last year Chinese export credit agencies provided almost 10 times more financial backing than the Ex-Im Bank did.
But Senate conservatives argued that the government should stay out of the marketplace. "We're in a bidding war with China and Europe to see who can subsidize the most loans at a time when all of us are broke," said Sen. Jim DeMint, South Carolina Republican. "We need to bring this to a close."
Among the amendments defeated before the Senate passed the bill was one by freshman Sen. Mike Lee, Utah Republican, that would have terminated the bank after a year.
Earlier this month, House Majority Leader Eric Cantor of Virginia and Democratic whip Steny H. Hoyer of Maryland reached a compromise designed to address some conservative concerns. In addition to renewing the bank for three years, it requires greater transparency in the bank's dealings; requires the bank to keep its default rate at less than 2 percent; and directs the bank to make clear that loans are needed for such reasons as assuming risks the private sector won't undertake or meeting competition from foreign export credit agencies.
The reauthorization bill passed the House last week on a 330-93 vote, with all of the "no" votes coming from Republicans.