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Garrett’s Jabs at Export-Import Bank May Stop His Bid to Lead It

The former N.J. congressman once voted against reauthorizing the bank

Former New Jersey Rep. Scott Garrett, center — shown here at a 2015 House Financial Services hearing — has been nominated to head the Export-Import Bank, an organization he once said “embodies the corruption of the free enterprise system.” (Chip Somodevilla/Getty Images)
Former New Jersey Rep. Scott Garrett, center — shown here at a 2015 House Financial Services hearing — has been nominated to head the Export-Import Bank, an organization he once said “embodies the corruption of the free enterprise system.” (Chip Somodevilla/Getty Images)

Former New Jersey Rep. Scott Garrett faces an unusual combination of Democrats and business groups opposing his nomination to lead the Export-Import Bank as the Senate hearing on his confirmation approaches.

Garrett, who lost his bid for re-election in 2016, is part of the wing of the Republican Party that sees the Ex-Im Bank’s loan, insurance and guarantee programs as corporate welfare that mainly benefits large companies. He was a founding member of the hard-line conservative House Freedom Caucus. 

If the Senate confirms him as president of the bank, Garrett would also be CEO and a board member. He is one of five Ex-Im Bank board nominees scheduled to appear before the Senate Banking Committee on Nov. 1 — and the one most likely to face strong resistance. The panel will also hear from the nominee to be the bank’s inspector general.

The U.S. Chamber of Commerce and the National Association of Manufacturers oppose Garrett’s confirmation. And nine Senate Democrats who met with him in August called the encounter “bizarre,” saying Garrett wouldn’t answer questions about his years of opposition to the bank when he was a senior figure on the House Financial Services Committee.

Voting against reauthorization of the bank in 2015 after a six-month lapse in its charter, Garrett described that legislation as “the resurrection of a bank that embodies the corruption of the free enterprise system.”

Congress reauthorized the bank in December 2015 for four years.

Opposition brewing

The confirmation of board members would give the Ex-Im Bank a quorum it hasn’t had since early 2015. The lack of a quorum prevents it from doing deals worth more than $10 million. 

President Donald Trump has also nominated former Alabama Republican Rep. Spencer Bachus, Kimberly Reed, Judith Delzoppo Pryor and Claudia Slacik to the board. Bachus is a former House Financial Services chairman. The U.S. Chamber of Commerce said in September it “strongly endorsed” those four nominees. 

The chamber said it was worried about reports that it could “derail the confirmations of the other four well-qualified nominees should Mr. Garrett’s nomination be rejected in Committee or in the full Senate.”

Jay Timmons, president and CEO of the National Association of Manufacturers, has blasted Garrett, saying his confirmation would amount to “a terrible trade deal for our country. His record of aggressively undermining the Ex-Im Bank is tantamount to a vicious trade war against American manufacturing workers.”

Sen. Heidi Heitkamp, a North Dakota Democrat who has at times backed Trump nominees opposed by more liberal members of her party, was among the nine Senate Democrats who met with Garrett in August and issued a statement calling him “one of the most vocal opponents of the Export-Import Bank while he was in Congress.” 

Garrett “agreed to speak with us about his nomination, but during the meeting, he wouldn’t discuss his personal thoughts about the bank and its mission,” the senators said in the statement. 

The other Democrats in the meeting were Minority Leader Charles E. Schumer of New York, Maria Cantwell and Patty Murray of Washington, Sherrod Brown of Ohio, Amy Klobuchar of Minnesota, Claire McCaskill of Missouri, Chris Coons of Delaware and Joe Donnelly of Indiana.

“Ex-Im Bank needs a full Board of Directors that will not sell out American jobs,” Brown, the ranking member on the Banking Committee, said in a statement Friday. “I’m hard pressed to understand how Mr. Garrett will square his past views about Ex-Im with running the agency.”

Collegial support

Garrett has supporters as well. Twenty-seven House members expressed their confidence in the entire slate of Ex-Im Bank board nominees — “and especially” Garrett — in an Oct. 6 letter addressed to Senate Banking Chairman Michael D. Crapo of Idaho and Brown.

“As former colleagues in the House, we can state unequivocally that Scott Garrett is a principled reformer who will greatly aid the President and his cabinet to remove corporate cronyism from the federal government,” read the letter, signed by Freedom Caucus founding member Rep. Jim Jordan of Ohio, among others. 

Garrett and the other nominees “can restore the credibility” the bank has lost, the letter said. Critics of the bank have complained that it caters to large companies, particularly Boeing Co., lowering their costs through loan credits, insurance and guarantees.

Other onetime colleagues have doubts.

“He won’t be confirmed,” predicted Rep. Denny Heck, a Washington Democrat. “Why on Earth would you nominate somebody to head up an organization that he had advocated the elimination of at every opportunity? Why would you do that?” 

Heck’s district includes operations of Boeing, one of the major corporate recipients of Ex-Im Bank export financing in the past. He and other bank supporters have unsuccessfully pushed amendments for a legislative fix to allow the bank to operate with a quorum of just two board members. 

The bank’s business shriveled by 75 percent in fiscal 2016, its latest reporting period. The $5 billion in loan guarantees and credit insurance issued that year marked a 40-year low for the agency.

While Garrett and Bachus are former congressmen, the other three board nominees have professional backgrounds that range from the Overseas Private Investment Corporation to the Treasury Department.

Pryor is a former vice president at OPIC, and Slacik is a former senior vice president for export finance at the Ex-Im Bank.

Reed, also nominated as first vice president of the bank, was senior adviser to Treasury secretaries John Snow and Henry M. Paulson, and led the Treasury Department’s Community Development Financial Institutions Fund. Most recently, she was president of the International Food Information Council Foundation.

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