[Senate Hearing 115-144]
[From the U.S. Government Publishing Office]
S. Hrg. 115-144
NOMINATIONS OF SCOTT GARRETT, KIMBERLY A. REED, SPENCER BACHUS III,
JUDITH DELZOPPO PRYOR, CLAUDIA SLACIK, AND MARK GREENBLATT
=======================================================================
HEARING
before the
COMMITTEE ON
BANKING,HOUSING,AND URBAN AFFAIRS
UNITED STATES SENATE
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
ON
NOMINATIONS OF:
Scott Garrett, of New Jersey, to be President of the Export-Import Bank
__________
Kimberly A. Reed, of West Virginia, to be First Vice President of the
Export-Import Bank
__________
Spencer Bachus III, of Alabama, to be a Member of the Board of
Directors of the Export-Import Bank; Reappointment as a Member of the
Board of Directors of the Export-Import Bank
__________
Judith Delzoppo Pryor, of Ohio, to be a Member of the Board of
Directors of the Export-Import Bank
__________
Claudia Slacik, of New York, to be a Member of the Board of Directors
of the Export-Import Bank; Reappointment as a Member of the Board of
Directors of the Export-Import Bank
__________
Mark L. Greenblatt, of Maryland, to be Inspector General of the Export-
Import Bank
__________
NOVEMBER 1, 2017
__________
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Affairs
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COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS
MIKE CRAPO, Idaho, Chairman
RICHARD C. SHELBY, Alabama SHERROD BROWN, Ohio
BOB CORKER, Tennessee JACK REED, Rhode Island
PATRICK J. TOOMEY, Pennsylvania ROBERT MENENDEZ, New Jersey
DEAN HELLER, Nevada JON TESTER, Montana
TIM SCOTT, South Carolina MARK R. WARNER, Virginia
BEN SASSE, Nebraska ELIZABETH WARREN, Massachusetts
TOM COTTON, Arkansas HEIDI HEITKAMP, North Dakota
MIKE ROUNDS, South Dakota JOE DONNELLY, Indiana
DAVID PERDUE, Georgia BRIAN SCHATZ, Hawaii
THOM TILLIS, North Carolina CHRIS VAN HOLLEN, Maryland
JOHN KENNEDY, Louisiana CATHERINE CORTEZ MASTO, Nevada
Gregg Richard, Staff Director
Mark Powden, Democratic Staff Director
Elad Roisman, Chief Counsel
Michelle Mesack, Senior Counsel
Elisha Tuku, Democratic Chief Counsel
Laura Swanson, Democratic Deputy Staff Director
Homer Carlisle, Democratic Professional Staff Member
Megan Cheney, Democratic Legislative Assisstant
Dawn Ratliff, Chief Clerk
Cameron Ricker, Deputy Clerk
James Guiliano, Hearing Clerk
Shelvin Simmons, IT Director
Jim Crowell, Editor
(ii)
C O N T E N T S
----------
WEDNESDAY, NOVEMBER 1, 2017
Page
Opening statement of Chairman Crapo.............................. 1
Opening statements, comments, or prepared statements of:
Senator Brown................................................ 3
NOMINEES
Scott Garrett, of New Jersey, to be President of the Export-
Import Bank.................................................... 4
Prepared statement........................................... 38
Biographical sketch of nominee............................... 40
Responses to written questions of:
Senator Brown............................................ 170
Senator Rounds........................................... 178
Senator Menendez......................................... 179
Senator Warner........................................... 181
Senator Heitkamp......................................... 183
Senator Cortez Masto..................................... 184
Kimberly A. Reed, of West Virginia, to be First Vice President of
the Export-Import Bank......................................... 6
Prepared statement........................................... 90
Biographical sketch of nominee............................... 92
Responses to written questions of:
Senator Brown............................................ 185
Senator Warner........................................... 187
Spencer Bachus III, of Alabama, to be a Member of the Board of
Directors of the Export-Import Bank; Reappointment as a Member
of the Board of Directors of the Export-Import Bank............ 8
Prepared statement........................................... 107
Biographical sketch of nominee............................... 109
Responses to written questions of:
Senator Brown............................................ 188
Senator Warner........................................... 190
Judith Delzoppo Pryor, of Ohio, to be a Member of the Board of
Directors of the Export-Import Bank............................ 9
Prepared statement........................................... 133
Biographical sketch of nominee............................... 135
Responses to written questions of:
Senator Brown............................................ 191
Senator Warner........................................... 193
Claudia Slacik, of New York, to be a Member of the Board of
Directors of the Export-Import Bank; Reappointment as a Member
of the Board of Directors of the Export-Import Bank............ 11
Prepared statement........................................... 143
Biographical sketch of nominee............................... 145
Responses to written questions of:
Senator Brown............................................ 194
Senator Warner........................................... 196
(iii)
Mark L. Greenblatt, of Maryland, to be Inspector General of the
Export-Import Bank............................................. 12
Prepared statement........................................... 158
Biographical sketch of nominee............................... 160
Responses to written questions of:
Senator Brown............................................ 197
Senator Warner........................................... 199
Additional Material Supplied for the Record
Letters in opposition to the nomination of Scott Garrett......... 201
Letter in support of the nomination of Kimberly A. Reed.......... 213
The Biggest Beneficiaries of the Ex-Im Bank...................... 214
Export-Import Bank: Propaganda Versus the Facts.................. 218
Boeing Helped Craft Own Loan Rule; Celebrating Our Independence--
From the Export-Import Bank.................................... 222
Key Argument for Export-Import Bank Invalid...................... 229
NOMINATIONS OF SCOTT GARRETT, KIMBERLY A. REED, SPENCER BACHUS III,
JUDITH DELZOPPO PRYOR, CLAUDIA SLACIK, AND MARK L. GREENBLATT
----------
WEDNESDAY, NOVEMBER 1, 2017
U.S. Senate,
Committee on Banking, Housing, and Urban Affairs,
Washington, DC.
The Committee met at 10 a.m., in room 508, Dirksen Senate
Office Building, Hon. Mike Crapo, Chairman of the Committee,
presiding.
OPENING STATEMENT OF CHAIRMAN MIKE CRAPO
Chairman Crapo. The Committee will come to order, and if we
could ask our nominees to please come forward.
As our nominees are becoming seated, we will again follow
the practice of Senator Brown and I making introductory remarks
and then we will proceed to swear the witnesses and take your
testimony, following which there will be questions and answers
from the Senators.
I will advise the Senators today that we have votes at
noon, and so we are going to be pushing to get through this as
a full hearing, and so I am going to be very tight on the time.
I am going to remind you when you start going over, so please
bear with me on that and try to stick to your time limits.
Senator Brown. There does not seem to be great enthusiasm.
Chairman Crapo. There does not.
With that I'm going to go ahead and begin my comments while
our witnesses are taking their seats.
This morning we will consider six nominations for the
Export-Import Bank, or Ex-Im. The Honorable Scott Garrett to be
President of the Export-Import Bank; Ms. Kimberly Reed to be
First Vice President of the Export-Import Bank; The Honorable
Spencer Bachus III to be a Member of the Board of Directors of
the Export-Import Bank; Ms. Judith Delzoppo Pryor to be a
Member of the Board of Directors of the Export-Import Bank; Ms.
Claudia Slacik to be a Member of the Board of Directors of the
Export-Import Bank; and Mr. Mark Greenblatt to be Inspector
General of the Export-Import Bank.
Welcome to all of you and congratulations on your
nominations. I see friends and family behind you and I welcome
them here today as well.
President Trump has expressed his support for Ex-Im, noting
it can help small businesses and U.S. competitiveness.
Congressman Garrett has echoed this sentiment, assuring that if
confirmed he will carry out the President's vision with regard
to Ex-Im. He is a long-time public servant who will bring
transparency and efficiency to the Bank's operations.
Congressman Garrett has committed to pursue regular Ex-Im Board
meetings, to transparently and thoroughly review the Bank's
transactions. He has also committed that under his leadership
the Bank will remain fully functional, operating in a fair
manner to support American jobs and provide maximum value to
the U.S. taxpayer.
We also have four other highly qualified nominees for the
Board to consider today. Each has a wealth of relevant
Government and private sector experience, including my good
friend, former Representative Spencer Bachus. Spencer and I
were elected to the House of Representatives in the same term
and worked closely together in the House for a number of years.
He is a pragmatic conservative and has demonstrated a long-time
commitment to promoting economic opportunity. His experience
and demeanor will be an asset to the Bank's Board.
Ms. Reed, who is nominated to serve as First Vice
President, has been Senior Advisor to former Treasury
Secretaries Paulson and Snow, and has served on several
congressional committees, and has held impressive leadership
positions in the private sector.
Ms. Slacik is a seasoned finance professional with a
breadth of trade, finance, commercial lending, and risk
management experience, most recently serving as Chief Banking
Officer and Senior Vice President of Export Finance at Ex-Im.
Ms. Pryor has spent the majority of her career working with
international businesses, most recently serving as the Vice
President of External Affairs at the Overseas Private
Investment Corporation.
The Office of Inspector General, for which Mr. Greenblatt
is nominated, is independent and plays an important role of
promoting efficiency in Ex-Im programs and detecting fraud,
waste, and abuse. Mr. Greenblatt has extensive senior-level
experience in the inspector general and oversight community,
including serving in two Cabinet-level Offices of Inspector
General. He also has more than 5 years conducting oversight in
the U.S. Senate.
Together, this diverse slate of nominees is well poised to
move the Bank forward in a positive manner. I look forward to
hearing each of the nominees' ideas and goals for helping
address opportunities and challenges facing the Bank,
supporting small business exports, and protecting taxpayers by
prudently managing the Bank's portfolio.
Congratulations on your nominations and thank you and your
families for your willingness to serve.
We have received several letters in support of today's
nominees and at this time I ask unanimous consent to enter
those letters into the record. Without objection, so ordered.
Senator Brown.
OPENING STATEMENT OF SENATOR SHERROD BROWN
Senator Brown. Thank you, Mr. Chairman. I ask unanimous
consent that the testimony of House Democratic Whip Steny Hoyer
in opposition to Mr. Garrett's nomination be included in the
record, and I also ask unanimous consent that the letters in
opposition to Mr. Garrett from the Ohio Manufacturers'
Association, the National Association of Manufacturers, the
Aerospace Industries Association, and the U.S. Chamber of
Commerce be included in the record.
Chairman Crapo. Without objection.
Senator Brown. Thank you, Mr. Chairman.
Today we hear from the six nominees whom President Trump
has put forward to lead the Export-Import Bank. I applaud the
President for now seeming to recognize the need to have a fully
functioning Ex-Im Bank so the United States does not continue
to lose jobs and contracts to foreign competitors. The House
and Senate voted overwhelmingly, 2 years ago, to reauthorize
the Bank, but since that vote Congress has starved the Bank of
the nominees it needs to function. For nearly 2 years, Ex-Im
has been unable to assist medium- and long-term transactions
larger than $10 million. As a result, we know that lots of
American jobs have been lost.
The Bank has been forced to sit on more than $30 billion
worth of transactions that cannot close until a quorum in the
Bank is restored. If these deals fail, and some will because of
delay, the blames lies squarely with the opponents here in
Congress and the opponents within the Administration.
Meanwhile, the doors of foreign export credit agencies are
wide open for business. France, Germany, and Italy each
provided some $9 billion of medium- and long-term export credit
last year. China provides more credit every 2 years than Ex-Im
has over its entire 80-year history.
In the face of that foreign competition, Mr. Garrett has
called for unilateral disarmament. During his time in Congress
he was a leader of the effort to slam shut the doors of
America's export financing bank. Opponents of the Bank, like
Mr. Garrett, have ignored basic facts, manufactured false
allegations, and disregarded common sense to justify their
position. Confirming Mr. Garrett as President of Ex-Im would be
like putting an arsonist in charge of the Fire Department.
The opposition to Mr. Garrett's nomination is overwhelming.
The National Association of Manufacturers, the Chamber of
Commerce, the Aerospace Industries Association all oppose Mr.
Garrett. State manufacturing organizations like mine in Ohio,
and I know the Chamber of Commerce in South Carolina, and small
business men and women from across the country have also
registered their opposition.
Mr. Garrett may argue this morning that he has had a change
of heart about the Bank, but you cannot really change who you
are. Time and again, Mr. Garrett has shown he lacks the
temperament to run an agency. He clearly would not treat all
Americans as equals. He has even complained that other
ethnicities will ``say yes to you constantly and then you will
realize they don't really mean it.''
Now, to be fair, Mr. Garrett said he did not mean
ethnicities but people in other countries. This is the man who
might lead the Export-Import Bank.
The Ex-Im Bank needs a president who will stand up for
American jobs. The Bank needs a leader who believes in the
mission, who will be respectful of other opinions, and yes, be
respectful of people who are different from him. That person is
not Scott Garrett.
Thank you, Mr. Chairman.
Chairman Crapo. Thank you, Senator Brown. We will now
administer the oath. Would all of the witnesses please stand
and raise your right hand.
Do you swear or affirm that the testimony you are about to
give is the truth, the whole truth, and nothing but the truth,
so help you God?
Mr. Garrett. I do.
Ms. Reed. I do.
Mr. Bachus. I do.
Ms. Pryor. I do.
Ms. Slacik. I do.
Mr. Greenblatt. I do.
Chairman Crapo. And do you agree to appear and testify
before any duly constituted Committee of the Senate?
Mr. Garrett. I do.
Ms. Reed. I do.
Mr. Bachus. I do.
Ms. Pryor. I do.
Ms. Slacik. I do.
Mr. Greenblatt. I do.
Chairman Crapo. Thank you. You may be seated.
Your written statements will be made a part of the record
in their entirety. As you have each been told, we allocate 5
minutes to you for an oral statement. I remind you as well as
my colleagues to honor the 5-minute clock. I will rap the gavel
to remind people who forget to watch the clock.
And with that, let us proceed. Mr. Garrett, you may proceed
first.
STATEMENT OF SCOTT GARRETT, OF NEW JERSEY, TO BE PRESIDENT OF
THE EXPORT-IMPORT BANK
Mr. Garrett. Good morning, Chairman Crapo, Ranking Member
Brown, and all the Members of the Committee.
I would like to begin by thanking the Members of the
Committee for, first of all, the opportunity to be with you
here today, and also to thank each and every one of you who has
taken of your time of what I know is very busy schedules that
you have, to meet with sometimes once and sometimes twice, to
discuss the matters, to hear your insights, to hear your
thoughts, and to listen to your advice as well.
Mr. Chairman, I would like to begin by thanking the
President of the United States for the honor that I have
received to be nominated as the head of the Export-Import Bank.
I am truly and deeply humbled by that nomination.
Next I would like to take a moment, if I may, to introduce
my family and to thank them as well; those that could be with
us today and those who, for various reasons, could not be with
us today. You know, it is said that children are a gift from
the Lord, and that is truly a true statement. And, I have been
very blessed. I have been blessed with two daughters, and
starting with my youngest, Brittany, who is behind me, and is
able to take time out of her work schedule to be with us today.
I am delighted that she is here today and I am very proud of my
youngest daughter, Brittany.
My oldest daughter is Jennifer, and her new husband, my new
son-in-law. She is a teacher and he is studying for his Ph.D.
as we speak. And, so neither one of them are able to be with us
today. I am obviously very, very proud of my daughter, Jen, and
Carlos, her new husband, as well.
And that brings us, of course, to my wife, right behind me,
Mary Ellen. It is said ``an excellent wife, who can find? She
is more precious than jewels,'' and that is absolutely true in
the case of my love and my partner for over 33 years, this past
August, together as my partner. Through all the years that we
went through, the 14-some-odd years as members of Congress, and
actually all the months as well, going through this nomination
process. She is my love and she is my partner, and I am glad
that she is able to be with us here today as well.
As I said, I am honored to be before this Committee and as
a nominee to lead the Export-Import Bank. Let me begin on this
point and be absolutely crystal clear. If I am so honored to be
the nominee and then confirmed to head Export-Import Bank, rest
assured that I am committed to keep the Bank fully open and
fully operational. Period. It will continue to operate. It will
continue to receive and review and pass loans that will help
manufacturing in this country and help manufacturing in this
space as well. Period.
I know that some of you, as I look around this Committee,
are fully supportive of the Export-Import Bank's mission. And,
I know a number of you represent constituencies and businesses
that are directly impacted by the availability of financing
from the Bank. So let me be clear again, and leave no doubt in
anyone's mind on this point: I will carry out the President
mission and I will see to it that the Bank is fully operating.
Why do I do that? Because I fully support the President's
pro-growth agenda. He has laid out an agenda to create jobs and
to expand the American economy and to make this country more
prosperous. And I completely agree that robust U.S. exports are
critical to the vitality of the manufacturing sector.
Furthermore, it is my belief that a robust manufacturing sector
is essential to a strong and vibrant economy.
See, strong manufacturing, in essence, goes hand-in-hand,
if you will, with the President's agenda of increasing
manufacturing and better jobs in this country. Furthermore, it
is absolutely essential--it is vital, if you will--that U.S.
companies have that proverbial level playing field to compete
in the world market today.
As a former Chairman of the House Financial Services
Committee and Capital Markets Subcommittee, I understand that
finance and the importance of capital markets in the creation
of these jobs.
So it will be my goal that, if I am confirmed, to fully and
strongly advance this agenda and ensure that the Ex-Im Bank
operates as intended by law, as established by each of you
here.
Let me end by repeating this--let me repeat: the Ex-Im Bank
will operate as intended by law, as established by legislature,
by you, the Members of this Committee. It will do so in an open
and honest and transparent manner, and that is something that I
am committed to doing.
Finally, let me close on this point. Having served in
Congress for 14 years, and having been on the other side, if
you will, I do very much appreciate the constitutional
responsibilities of the legislative branch, and so if
confirmed, I look forward to having a continuous, open, and
transparent dialog and discussion with Congress and with this
Committee, specifically, and each one of you specifically. In
short, I am committed to working with you to promote the
creation of American jobs, to provide the maximum value for
American taxpayers, and ensure that Ex-Im operates fully.
So I am honored again, Mr. Chairman, to be here today, and
I do look forward to your questions that follow. Thank you.
I yield back.
Chairman Crapo. Thank you, Mr. Garrett, and we will just go
down the line. Ms. Reed.
STATEMENT OF KIMBERLY A. REED, OF WEST VIRGINIA, TO BE FIRST
VICE PRESIDENT OF THE EXPORT-IMPORT BANK
Ms. Reed. Good morning. Chairman Crapo, Ranking Member
Brown, and Members of the Committee, thank you for the
opportunity to appear before you today. I am honored to be the
President's nominee to serve as First Vice President of the
Export-Import Bank of the United States, a position that
includes being Vice Chairman of the Bank's Board of Directors.
As a West Virginian, I am grateful to Senators Shelley Moore
Capito and Joe Manchin for their support.
I am pleased to introduce my father, Terry, and sister,
Meghan. My father taught me the importance of public service
and helping others. My mother, Janet Logue Reed, an Ohioan,
passed when I was 9 years old, but I know that she is with us.
My brother, Mark, sister, Ashley, and brother-in-law, Jeremy, a
Purple Heart recipient, are watching online.
My interest in public service was sparked when I was 4
years old and my father was a counsel to the then-newly founded
Republican Study Committee. This is when I first met former
House Ways and Means Chairman Bill Archer and his chief of
staff, Don Carlson. They have supported me my whole life. I am
deeply honored that Don is with us today and I am told that
Chairman Archer is en route, and I know that we all will
welcome him when he joins us.
When it comes to helping others, I serve on the Alzheimer's
Association National Board of Directors. This disease impacts 5
million Americans and 15 million unpaid caregivers, and my
thanks go to you and Members of Congress, as well as advocates
watching online today, who take action to end our Nation's most
expensive disease.
I appreciated the opportunity to meet with many of you to
discuss your hopes for the Bank. Creating good American jobs is
a top priority for the President, as I am sure it is for all of
you. If confirmed, I will deliver on this priority. We are on
the cusp of an American renaissance in manufacturing, including
for small and new entry companies.
I am committed to serving our Nation, and if confirmed,
look forward to bringing two decades of bipartisan experience
to my work at the Bank, which has more than 400 dedicated
career professionals. Throughout my career, I have engaged not
only with CEOs and world leaders but also with thousands of
constituents and small businesses in your States.
As Director of the Treasury Department's Community
Development Financial Institutions Fund under President George
W. Bush, I made job creation in distressed communities a key
priority. I oversaw efforts to provide $4 billion in financing,
in the forms of New Markets Tax Credits, loans, and grants, to
financial institutions and economic development groups that
were investing in our Nation's rural, Native American, and
urban communities.
As counsel to three congressional committees, I focused on
oversight and reform to improve our Federal agencies. I deeply
appreciate the valuable role Congress plays in oversight of
Federal programs, including the Bank, and the importance of
faithfully executing all our laws consistent with the intent of
Congress.
As Senior Advisor to U.S. Treasury Secretaries John Snow
and Henry Paulson, I helped advance our Nation's economic
program. I know the value of working as part of an
Administration's team in making sure Congress and the American
people are fully informed about the President's agenda.
Most recently, as President of the International Food
Information Council Foundation, I worked with the U.S.
Departments of Agriculture and State in numerous emerging
market countries around the world to increase acceptance of
U.S. exports.
The Bank has become an important source of funding for
small businesses and an avenue for job creation. Nonetheless,
there are needed reforms to ensure that taxpayer dollars are
protected from waste and fraud and that Americans are obtaining
the best value.
With respect to the activities of the Bank, my friend,
Chairman Archer, taught me that any reform must not occur at
the expense of our national interests. He warned against
unilateral disarmament in a fiercely competitive global
economy. I share his concerns and would never advocate to place
American exporters and workers in a worse position than our
foreign counterparts. There are now 95 foreign export credit
agencies, including 11 acknowledged in the past year, many of
which are used by foreign Governments attempting to move U.S.
jobs and business revenue to their countries.
In West Virginia, my grandfather taught me the importance
of having the necessary tools in life. As an eighth-grader
during the Great Depression, he launched Reed's Dairy. When
private sector financing was not available, the Federal Land
Bank filled the gap and my grandfather farmed for the rest of
his life. He was meticulous with his toolbox. The United States
must have the right tools, including a fully functioning
Export-Import Bank, in our toolbox to be successful in the
global marketplace.
But those tools need to be constantly repaired and
reformed. I am especially interested in making sure that small-
and medium-enterprises, just the kind of businesses I am so
familiar with in West Virginia, have full access to the
programs authorized by Congress.
If confirmed, I will bring a fresh set of eyes to the Bank
to strengthen U.S. competitiveness and bring better value to
the American taxpayer, as the opportunity for Americans to
create an export has never been brighter.
Thank you for your consideration. I would be pleased to
answer any questions.
Chairman Crapo. Thank you. Mr. Bachus.
STATEMENT OF SPENCER BACHUS III, OF ALABAMA, TO BE A MEMBER OF
THE BOARD OF DIRECTORS OF THE EXPORT-IMPORT BANK; REAPPOINTMENT
AS A MEMBER OF THE BOARD OF DIRECTORS OF THE EXPORT-IMPORT BANK
Mr. Bachus. Chairman Crapo, Ranking Member Brown, and
distinguished Members of the Committee, I appreciate you
considering my nomination today. I also welcome the fact that
you granted me the opportunity to hear your concerns about the
Bank; some are in favor of the Bank, some have concerns about
the Bank.
It was an honor to be selected by President Trump. But it
is even more of an honor--and I welcome the opportunity to work
for American workers--to preserve jobs and to create jobs, and
as we all know, those jobs are under a threat. They used to say
that the American dream was home ownership, but you cannot have
a home without a job, a good-paying job.
I am very pleased today to have my wife and best friend,
Linda, join me. She is representing my five children and our
seven grandchildren, some of whom probably would not even want
to be here anyway.
[Laughter.]
Mr. Bachus. During my entire public service, she has been
at my side, encouraging me along the way, and she has made me a
better person.
There is a familiar phrase from the 1967 movie, ``Cool Hand
Luke'', which takes place in the South. It says, ``What we have
got here is failure to communicate,'' and I think that is the
story of Ex-Im Bank. There is hostility among certain members
of the Senate, and the House, including myself when I was in
the House, about their failure to communicate. When problems
would come up they would simply ignore some of our concerns.
And I see my major role at the Bank and if the Board would
allow you to sort of take whatever little latitude in what your
mission will be. My mission will be to try to create
communication between the members of the Board of Ex-Im Bank
and the members of the legislative branch. As Mr. Garrett said,
I have a great respect for the legislative branch, and I do not
believe that agencies ought to just ignore their concerns.
If you will recall, in the movie, Cool Hand Luke, the only
victim in the movie was Paul Newman. Since he was a fictitious
character, there really wasn't a lot of damage when the day was
over. But I am very concerned that this lack of communication
between the Senate, the House, and the agency, and those that
are detractors of Ex-Im, that it threatens the very existence
of the Bank.
I am an unapologetic supporter of the Bank and its mission.
You can argue about some of the numbers, but there are hundreds
of thousands of American workers who depend on the Bank. Not
only that but 95 percent of the market is outside the United
States. I see my good friend, Tim Scott. When it comes to
aviation, we dominate that market. But if you look at a recent
Wall Street Journal report, China, Russia, both have plans,
heavily subsidized plans, by the way, to take over that market.
And we can scoff at that, but the Chinese think in 10 years
they will become a dominant player in that market.
And let me remind you of this, as aviation seems to sort of
be something that we all talk about, there are more aviation
workers in the United States than there are automobile workers.
That comes as a surprise to me. Every State in the union
depends on them. When you write a check to an aviation company,
you're writing a check to 23,000 small businesses and large
businesses working with those companies.
Let me close by saying this. Ex-Im financed the Burma Road.
It financed the Marshall Plan. And, Congress designated it as
the agency to rebuild Iraq, with 100 percent of American goods.
They have not been able to fulfill that obligation because the
Bank has basically been shut down.
But going back, American workers can compete with any
workers in the world. They can produce the best product at the
best price. But they have to do so on a level playing field.
Thank you.
Chairman Crapo. Thank you. Ms. Pryor.
STATEMENT OF JUDITH DELZOPPO PRYOR, OF OHIO, TO BE A MEMBER OF
THE BOARD OF DIRECTORS OF THE EXPORT-IMPORT BANK
Ms. Pryor. Thank you, Mr. Chairman, Ranking Member Brown,
distinguished Members of the Committee. I am honored to appear
before you today as a nominee for the Board of Directors of the
Export-Import Bank of the United States. I am deeply grateful
to President Trump for nominating me, and to Senator Schumer
for his recommendation and support.
If confirmed, I pledge to carry out Ex-Im's mission with
honor and integrity, and I would also like to thank Ranking
Member Brown, Senator Heitkamp, and their staff for their
support and encouragement. And thank you to all of the Members
of the Banking Committee for your commitment to move this
process forward. I have met with many of you to discuss your
priorities and how we can ensure that Ex-Im continues to
support American jobs, in your communities and throughout the
country, by increasing our exports of goods and services.
Last, I would like to introduce some family members here
with me today. My husband, David Pryor, Jr.; our son, Hampton,
whom you've been listening to through these opening remarks;
and my brother-in-law, Mark Pryor. My parents have been gone a
while but today would have been my mother's 90th birthday, so
happy birthday, Mom. My brother, Joseph DelZoppo, and my niece,
Christine, could not be here but I am grateful to them for
their support and love.
From the American dream of my grandparents, who immigrated
here at the turn of the last century to work in the Cleveland
factories, to the boom of the post-World War II years that my
parents enjoyed, to my youth and the unfortunate decline of
manufacturing in what many call the Rust Belt--but let us call
it what it really is, the industrial heartland of America, and
clearly the need for Ex-Im in Cleveland and throughout the
country is even more relevant today.
If confirmed, my top priority will be to focus on Ex-Im's
mission of supporting American job and growing exports, while
protecting taxpayer dollars. With over 95 percent of the
world's consumers living outside of U.S. borders, there are so
many opportunities for U.S. manufacturers to grow their
customer base abroad. Indeed, I look forward to contributing to
that growth by increasing support for small businesses and
community banks, and by ensuring that businesses of all sizes
can compete fairly.
With nearly 100 other export credit agencies in the world
today, getting our Export-Import Bank fully up and running is
imperative to helping American manufacturers.
I would bring to Ex-Im a unique set of work-life
experiences. My decades of private sector work, in corporate
affairs, marketing and sales, branding and business development
have made me a trusted tonesetter and caretaker of an
organization's public reputation. My 6\1/2\ years of Government
service at the Overseas Private Investment Corporation, OPIC,
engrained in me a sense of duty to ensure taxpayer dollars are
protected and Government programs are managed with integrity
and efficiency.
I spent most of my career working for American businesses
with an international presence, often in emerging markets.
Whether a Fortune 500 or a small business, I was fortunate to
have staff in-country to help me navigate the landscape. I
remember how daunting it seemed--different customs, languages,
regulations--yet this is the reality for many U.S. small
businesses wishing to export into foreign markets. I recognize
how difficult it can be to figure out how to get their product
from Point A to Point B.
I proudly served during the Obama administration as OPIC's
Vice President for External Affairs and as a member of its
leadership team. I held a seat on the Investment Committee,
weighing in on all project commitments over $20 million, and I
was responsible for the agency's relationship with Congress,
the media, and the small business community, doubling the
number of workshops held around the country, with nearly 4,000
U.S. small businesses educated to date. Conversations with
these small businesses made me realize they truly are the
engine of our economic growth.
If confirmed, I believe my experience, paired with updates
to the 2015 charter, as enacted by Congress, will help to
modernize the Bank and keep its mission relevant in today's
changing times.
Ex-Im has an 80-year track record supporting U.S. jobs and
growing exports. It takes the fear out of exporting for smaller
companies and ensures a level playing field so all American
manufacturers can compete fairly.
I look forward to working with my fellow Board members, the
nominee for Inspector General, and the entirety of Ex-Im
management and staff, with one objective in mind--to support
and sustain American jobs through exports.
Chairman Crapo, Ranking Member Brown, Members of the
Committee, thank you again for this opportunity to appear
before you today as I respectfully ask for your support to
serve on the Board of Directors of the Export-Import Bank of
the United States.
Thank you, and I am happy to answer any questions.
Chairman Crapo. Thank you. Ms. Slacik.
STATEMENT OF CLAUDIA SLACIK, OF NEW YORK, TO BE A MEMBER OF THE
BOARD OF DIRECTORS OF THE EXPORT-IMPORT BANK; REAPPOINTMENT AS
A MEMBER OF THE BOARD OF DIRECTORS OF THE EXPORT-IMPORT BANK
Ms. Slacik. Thank you, Chairman Crapo, Ranking Member
Brown, and distinguished Members of the Committee. It is an
honor to appear before you today. I am grateful to be nominated
by the President to be a member of the Board, and if confirmed
I will be honored to serve.
Let me start by thanking the Members of the Committee I've
met work and for--I appreciated all your concerns about the
Bank--and for those of whom I did not meet, I look forward to
meeting with you and hearing your concerns about the Bank as
well.
Before presenting my own background, let me first introduce
you to the members of my family who are here today. First, my
spouse, Susan Davis, who was born and raised in Louisiana, and
who has spent most of her professional life in the service of
impoverished people in the neediest parts of the world. And
second, my brother, Kurt Slacik, who was born in New York
State, and who is now a senior executive at a steel mill in
Pennsylvania.
As for myself, I was born in upstate New York and grew up
there, as well as in New Jersey, Illinois, Connecticut,
California, and Massachusetts. I also spent 5 years in
Brussels, Belgium, where my father was a senior executive for a
major U.S. company. I am the product of both public and
parochial schools, and Susan and I are members of the Middle
Collegiate Church in Manhattan, which was founded in 1628 by
the Dutch seeking a religious freedom, and we were married
there 5 years ago.
While my parents are both deceased, I have four siblings
and five smart and beautiful nieces. My paternal grandparents
immigrated to the United States from Czechoslovakia just before
the First World War, and set up a small meatpacking business in
upstate New York. My maternal grandfather was a coal miner in
Scranton, Pennsylvania.
Susan and I live in New York City, a magnificent city that
was once again wounded yesterday.
I have spent the last 35 years in the financial services
industry, most recently as a commercial lender in corporations
and as an international trade specialist. My most recent
professional position was as the Chief Banking Officer at the
Export-Import Bank, from 2013 to 2016. I learned firsthand from
the 400 excellent and diligent staff at Ex-Im of the importance
of the Bank to American exporters and the workers they employ.
By leveling the playing field for large businesses and
assuming the risk for small businesses, Ex-Im enables American
businesses to successfully compete on the global stage, where
foreign Governments do the same for their national companies.
The bank thereby accomplishes its ultimate mission of helping
our businesses grow and supporting jobs, jobs that pay nearly
20 percent more than other jobs of comparable nature involving
products and services consumed here at home.
During my tenure as Chief Banking Officer, the staff and I
analyzed billions of dollars of transactions. My
responsibilities included expanding the public's awareness of
the Bank and overseeing the due diligence. I ensured that the
Board, which has the ultimate authority to approve transactions
larger than $10 million, understood the structures and risks.
My close working relationship with the Board allowed me to also
gain a key insight into their responsibilities.
If confirmed as a member of the Board of Directors, I
pledge to vigorously carry out the mission of the Bank. I
further pledge to diligently work with all Members of the
Committee to address their concerns and keep them informed of
the Bank's activities.
Mr. Chairman, Senator Brown, and Members of the Committee,
thank you for your time and consideration. I look forward to
answering any questions, and helping to provide jobs for my
fellow citizens.
Chairman Crapo. Thank you. Mr. Greenblatt.
STATEMENT OF MARK L. GREENBLATT, OF MARYLAND, TO BE INSPECTOR
GENERAL OF THE EXPORT-IMPORT BANK
Mr. Greenblatt. Thank you, Chairman Crapo, Senator Brown,
Members of the Committee, it is an honor to appear before you
today as the nominee to serve as the Inspector General of the
Export-Import Bank.
At the outset, I would like to thank my family, friends,
and colleagues for their support, specifically my family who
instilled in me qualities like honesty and integrity,
perseverance and hard work; my wife, Jana, who has been
unfailingly supportive for 17 years; and my boys, Micah and
Levi, who is not here. They keep me grounded and serve as
rambunctious reminders of why we are all here, to improve our
country for future generations.
I come from a long line of small business operators, from
my grandparents, who owned a small deli in West Philadelphia,
to my father, who is here today, who started three successful
businesses and used our home as collateral when times got
tough, to both my brothers--and another one is here today--one
of whom runs a manufacturing company that exports products all
around the world, from a small factory right up the road in
Baltimore.
As you can see, small business is in my blood.
Unfortunately, I was the black sheep of the family who went to
law school. The good news, however, is that I followed in my
mother's footsteps and dedicated my career to public service,
focusing specifically on uncovering waste, fraud, and abuse in
Government programs. I started my public service here, in the
U.S. Senate, conducting oversight for the Permanent
Subcommittee on Investigations. During my PSI tenure, I led an
investigative staff through numerous complex, bipartisan
inquiries that identified waste and abuse in important
programs, such as Medicare and the United Nations.
After 5\1/2\ years at the Senate, I joined the special
investigations unit at the Department of Justice OIG. During my
5 years there, I led several sensitive matters, such as the
investigation that uncovered pervasive misconduct in the
Department of Justice voting section.
In 2014, I moved to the Department of Commerce OIG, where I
currently serve as the Assistant Inspector General for
Investigations. With the help of our highly talented staff, I
spearheaded a revitalization of the Office of Investigations,
restoring its integrity and professionalism and creating a
culture of ownership and success. I am pleased to report that
we have achieved considerable results in a very short time.
It is the nexus between these two threads, my experience in
Government oversight on the one hand and my family's background
in small business on the other, that makes me so excited at the
prospect of becoming the Inspector General for the Ex-Im Bank.
I appreciate Ex-Im's important mission of supporting American
jobs, including those in small businesses, by facilitating the
export of goods and services abroad. The Inspector General
plays an integral role in that mission, by providing objective
oversight to promote integrity, economy, efficiency, and
effectiveness in Ex-Im's operations.
I am fortunate to have served under the leadership of
strong role models, including leaders here in the Senate and
stalwarts in the IG community, on how to run probing, objective
investigations that seek to uncover the truth and effect
positive change. With that in mind, if I am confirmed, I would
strive to be an agent of such positive change, focusing on
eliminating waste, fraud, and abuse, identifying problems, and
making recommendations to Ex-Im's leadership.
I believe that an OIG can fulfill its mission to provide
independent oversight while simultaneously maintaining a
constructive relationship with the agency. I have done just
that at the Department of Commerce. Now our oversight has been
consistently probative, insightful, and independent, which has
included telling hard truths as necessary. But it is all built
on a foundation of good faith and the shared goal of improving
the agency's results for the benefit of the American taxpayer.
I look forward to developing the same type of healthy and
productive relationship with Ex-Im's Board and the staff.
I also appreciate the importance of maintaining strong
relations with this Committee and other Ex-Im stakeholders in
Congress. In light of my 5 years conducting oversight here at
the Senate, the significance of that relationship resonates
with me on a personal level. With that in mind, if confirmed, I
will maintain direct and frank communications with this
Committee and others in Congress.
In closing, I thank the Committee for its consideration of
my nomination, and if confirmed, I will work with you to
achieve our common goals.
Thank you, and I look forward to your questions.
Chairman Crapo. Thank you, and before I ask my questions I
probably should not go down this row but I am going to. I
notice a couple of our former colleagues in the audience, and I
just wanted to welcome you. Former Congressman Bill Archer just
came and joined us. Bill. I think both of us served in the
House with Bill, Sherrod and I did, and I am sure other Members
of the Committee did. And former Senator Mark Pryor, we welcome
you here as well.
Now I have probably started down a road I should not have
started traveling. I apologize to other members in the audience
if I did not introduce you.
My first question is for you, Mr. Garrett. There has
obviously been a lot of controversy surrounding your
nomination. There have been a lot of articles and letters
surrounding your past opposition to the Export-Import Bank and
how, as president, you will operate the Bank.
I want to give you just a minute to respond to that, but
particularly I would like to have your assurance--and I think
you have already given this but I would like to raise it--your
assurance that you will call regular meetings, you will bring
the applications and business of the Bank before the Board, and
that you will operate the Bank as the President intends it to
be operated.
Mr. Garrett. Thank you, Mr. Chairman, for that question. So
it's a two-parter, I guess. The first part is that, yes, as I
stated in my opening statement, I am honored to have received
this nomination because I'm in line with the President's
overall agenda, which is to make the country more prosperous,
with the complete understanding that the only way we get there
is a stronger economy, and the only way we get there is
stronger exports.
Two, the second part of the question, the short answer is
yes. The longer answer is the one that I gave in my opening
statement, that yes, if confirmed, you will see, and you have
my commitment, that the Bank will continue to operate, that you
will continue to receive, solicit, get applications for loans
and guarantees, they be diligently reviewed and processed by
the Board, and those loans will be executed, going back to the
ultimate goal to provide that support for the manufacturing
sector of this country. Thank you.
Chairman Crapo. Thank you. And as I reminded all of our
Senators at the outset, we have only 5 minutes. I have three
left, and so I want to ask--I am going to give you a pass, Mr.
Greenblatt. I would like to ask the other four members of the--
or nominees for the Board to quickly, in 30 or 40 seconds, just
tell me, U.S. companies are increasingly challenged by
subsidized export financing from China and other foreign
Nations, and I would just like you to quickly give me your
ideas for enhancing U.S. competitiveness in this landscape.
Ms. Reed. Thank you, Chairman. Coming from West Virginia, I
know the importance of small business, and so that would be one
of my initiatives. I would make sure that our small businesses
are informed of our products, and are applying to us, as the
Bank of last resort, if there is a need.
Also, we all care about being good steward of the taxpayer
dollar, and so while we are trying to make the Bank be as
successful as possible, if I am confirmed, I also will be
focused on oversight as a Board member.
Chairman Crapo. Thank you. Mr. Bachus.
Mr. Bachus. Mr. Chairman, first of all, I would say that
the financial product that has been offered in the past has
sometimes not been adequate and adequately communicated to
small businesses. I would use force multipliers, trade
associations, local and State officials, our congressional
partners, our small banks to reach small businesses.
Chairman Crapo. All right. Thank you.
Mr. Bachus. Thank you.
Chairman Crapo. Thank you. Ms. Pryor.
Ms. Pryor. Thank you, Mr. Chairman. As Ranking Member Brown
mentioned in his opening statement, China alone, in the last 2
years, has surpassed what the Export-Import Bank has done in
its entire history. So not only is it important to get the Bank
fully up and running, once a quorum exists, and if I am
confirmed to the Board of Directors, I will look to support the
Bank's mission to growing jobs and exports. It is not about
competing. It is really about fair competition and making sure
that we are leveling the playing field for businesses of all
sizes, so that we can go out and compete. American
manufacturers make great products and I am confident in their
ability to compete on quality and price.
Chairman Crapo. Thank you. Ms. Slacik.
Ms. Slacik. Mr. Chairman, my vision for the Export-Import
Bank is that we help our great American companies, large and
small, get their fair share of the nearly $50 trillion of
infrastructure spending that is going to happen around the
world in the next 5 to 10 years, and in that way help the
citizens of this country, the hundreds of thousands of them
that are only making between $10 and $15 an hour, and help them
make between $50 and $100 an hour.
Chairman Crapo. Thank you, and you guys did it with 1
second to spare. I appreciate it.
Senator Brown.
Senator Brown. Thank you, Mr. Chairman. I first thank Ms.
Pryor for rejecting the term ``Rust Belt.'' It diminishes and
demeans our workers and our region. Thank you for that.
I want to start with some yes-or-no questions, and they are
yes-or-no questions and I would like yes-or-no answers. For our
nominees, starting with Ms. Slacik and moving from our left--
your right to left, my left to right. Ms. Slacik, do you
believe the Ex-Im Bank is the most shameless example of crony
capitalism?
Ms. Slacik. No, I do not.
Senator Brown. Ms. Pryor.
Ms. Pryor. I would agree with Claudia, no.
Mr. Bachus. No.
Ms. Reed. No.
Mr. Garrett. No.
Senator Brown. Thank you. Do you believe, starting again,
Ms. Slacik, do you believe the Bank embodies the corruption of
the free enterprise system?
Ms. Slacik. Absolutely not.
Ms. Pryor. Agree.
Mr. Bachus. No.
Ms. Reed. No.
Senator Brown. Mr. Garrett.
Mr. Garrett. No.
Senator Brown. Do you believe the Export-Import Bank mocks
the American dream? Yes or no. Ms. Slacik.
Ms. Slacik. No, sir.
Ms. Pryor. No, sir.
Mr. Bachus. No, Senator.
Ms. Reed. No, sir.
Senator Brown. Mr. Garrett.
Mr. Garrett. No.
Senator Brown. I do not think it will come as a surprise by
those three quotes are from statements that Mr. Garrett made as
a member of the House in 2015. Mr. Garrett voted against Ex-Im
Bank reauthorization in 2015 and in 2012. So my question, Mr.
Garrett, for you, is do you retract your call to shut down the
Bank?
Mr. Garrett. Thank you. So as I stated in my opening
statement, should I be confirmed, I look forward to making sure
that the Bank is operational, fully operational, and conducts
the mission----
Senator Brown. But--I heard that----
Mr. Garrett. ----that Congress sets for it----
Senator Brown. ----in your opening statement, but----
Mr. Garrett. Thank you, Senator.
Senator Brown. ----I--there was nothing in your opening
statement retracting--let me back up. Secretary Perry, as we
know, famously called for the elimination of the Department of
Energy back in 2011, but he also said, during his confirmation
hearing, this year, that upon learning about DOE's work he
``deeply regretted his previous statements.'' There is nothing
like that in your previous statement. So were you wrong? Do you
wish to retract your past statements regarding Ex-Im?
Mr. Garrett. So thank you for the question, Senator. As you
indicate, my prior statements are all a matter of public
record. My statement here today is what my intention is, should
I be confirmed to lead Ex-Im Bank, with regard to full
compliance of the legal reform of 2015, to see to it that it is
a fully functional bank and one that actually completes and
comports with the reforms that were enacted in 2015. Thank you,
Senator.
Senator Brown. So I--you know, I do not quite know where to
go with that. So you have changed your position on Ex-Im, just
to be confirmed?
Mr. Garrett. Senator, if the question is what has changed
since 2015, what we have seen change is a new Administration,
and what we have seen change is a new agenda by this
Administration to see to it that the economy actually grows and
that businesses are given a fair chance to grow their
businesses, both nationally and internationally as well. That
is a significant change since 2015.
Senator Brown. It seems----
Mr. Garrett. Thank you, Senator.
Senator Brown. OK. Thank you, Mr. Garrett. It seems, to me,
what has changed is you have been offered this good-paying job
to run the Export-Import Bank, not the Export-Import--not the
change of the Export-Import Bank but perhaps the change of your
situation. It is clear to me you have a history of ignoring the
jobs lost in Cleveland and West Virginia and Maryland and
Alabama, because of the inability of this Congress to fill
the--fill out the complement of confirmed nominees, and it is
clear to me that--it is clear to me, fortunately we have four
other nominees that are--that absolutely believe in the mission
of the Export Bank.
Let me ask one other question of all of you. Will you
commit to responding--starting again with Ms. Slacik--will you
all commit to responding to any inquiries that I make, the
Chairman makes, or anybody on this Committee makes of you in
regards to your work at Ex-Im? Ms. Slacik.
Ms. Slacik. Of course.
Ms. Pryor. Yes, absolutely, Senator.
Mr. Bachus. Yes, Senator.
Ms. Reed. Yes, sir.
Senator Brown. Thank you. Thanks, Mr. Chairman.
Chairman Crapo. Senator Toomey.
Senator Toomey. Thank you, Mr. Chairman. I have got a
question for Ms. Pryor and Ms. Slacik. Is it important to you
that Ex-Im Bank not lose taxpayer money under your leadership?
Just yes or no, preferably. Is that important?
Ms. Slacik. Yes, sir.
Ms. Pryor. Yes, sir, it is.
Senator Toomey. OK. And so as a member of the Board, would
you commit to working for reforms and policies and procedures
that you feel would appropriately diminish the risk that
taxpayers would lose money? Would you commit to working in that
fashion?
Ms. Slacik. Of course.
Ms. Pryor. Yes, absolutely.
Senator Toomey. OK. Good. So I am glad to hear that our
Democratic nominees are open to working on reform to
minimizing, or at least appropriately reducing taxpayer risk. I
know that the Republican nominees are open to that as well.
Mr. Chairman, it has long been no secret I am deeply
skeptical about the mission of Ex-Im Bank. I know that I am in
the minority in the U.S. Senate with these views. However, I do
share interesting company. President Obama once said, and I
quote, ``The Ex-Im Bank is little more than a fund for
corporate welfare.'' Bernie Sanders, with whom I occasionally
disagree, has opposed the reauthorization.
I have concerns at several levels. I think this is a very
dubious proposition for taxpayers. Ex-Im proponents have often
claimed that the Ex-Im Bank only takes risks that private
lenders are unable or unwilling to take, and yet, at the same
time, proponents will argue that Ex-Im only makes safe bets.
Well, the fact is it is impossible to have both. The Bank is
either crowding out private sector lenders and guarantors or it
is taking on transactions that the private sector will not take
on, at least not at the way it is priced.
And that leads me to a fundamental concern that I have,
which is that Ex-Im wins business necessarily by systematically
under-pricing the risk, relative to the way the market views
that risk. That is why businesses turn to Ex-Im. And it is not
just me who has this view. In 2014, the CBO reported, using a
fair value accounting, which is simply accounting for the risk,
they expect Ex-Im to lose $2 billion for taxpayers over the
next 10 years.
In addition, Mr. Chairman, as we all know, inevitably, Ex-
Im Bank ends up picking winners and losers. It is a great deal.
If you are an exporter and Ex-Im subsidizes the foreign company
that buys your product, that is great. But sometimes that
results in an unfair advantage for some and not others. We
heard--Congress has heard testimony from Delta about a famous
transactions in which Ex-Im subsidized aircraft for Air India,
which gave them a competitive advantage over Delta, which
resulted in the loss of about 1,000 American jobs at Delta. I
could go on about this but I think I probably will not change
any minds on the Committee, Mr. Chairman.
Let me say this about our nominees, all of whom I think are
very, very good men and women and capable individuals. Given
that I know that I am in the minority in this view, I am
willing to support the confirmation of all of these nominees,
which would restore a quorum and allow the Ex-Im Bank to
function. However, I think reforms that protect taxpayers are
essential, and for that reason I will support these nominees
either on block, or I will support them sequentially, provided
that Scott Garrett is confirmed first. And as long as that is
the case, and Scott Garrett is confirmed by the U.S. Senate,
then I will support, as I say, reconstituting the quorum on the
Board. If not, then I will do everything I can to prevent Ex-Im
from getting a quorum.
Thank you.
Chairman Crapo. Senator Warren.
Senator Warren. Thank you, Mr. Chairman. I want to follow
up on Senator Brown's question. Mr. Garrett, the President has
nominated you to lead the Export-Import Bank. This is a
Government corporation that helps American companies sell their
products abroad, and the Bank authorizes billions of dollars in
taxpayer-backed loans and loan guarantees, and supports
thousands of jobs in this country.
Now I have had a lot of serious concerns about the Bank,
and I have pushed for changes, to make sure that it focuses on
helping small businesses rather than a handful of giant
corporations. But you spent your time in Congress trying to
kill the Bank, not to reform it. You said that the Bank
``embodies the corruption of the free enterprise system.''
Those were your words. And now you want to lead that very same
bank. And in your testimony you say that if you are confirmed,
``The Bank will continue to fully operate, point blank.''
OK. So that is a 180-degree switch on this issue in under 2
years. And I do not understand why anyone should believe what
you are saying now. How do we know you are not hoping to get
confirmed so you can go back to what you really want to do, and
that is kill the Bank that embodies the corruption of the free
enterprise system?
Mr. Garrett. Thank you, Senator, for the question. As I
stated in my opening statement, my commitment to you is to see
to it that the reforms that were put in place are fully carried
out. Having served in Congress and taken part in those debates,
I recognize the significance and the importance of the reforms
that Congress put in the 2015 Reauthorization Act for Ex-Im.
Should I be confirmed, I will see to it, and I am
committing to you personally, that I will do everything in my
power to see to each and every one of those are completed
fully, and if that is done, that goes to my opening statement
that you will then have a fully functioning, operating bank, as
set forth by the rule of law, as established by this Committee
in the Congress.
Senator Warren. Well, you can say all you want, that you
want the Bank to function, but my question is, I just do not
know why you would have any credibility on this.
So let me ask the question another way. When you were in
Congress, you and other Bank opponents forced Congress to let
the Bank's charter expire for 5 months in 2015. The Bank was
not able to guarantee any new loans during that time, and since
then the Bank has not been able to approve any transactions
over $10 million.
That cost us real jobs in Massachusetts. Before your
shutdown efforts, from 2014 to 2015, 78 companies in
Massachusetts benefited from $177 million in Ex-Im Bank
authorizations, but in 2016 and 2017 combined, only 49
companies got Ex-Im Bank assistance, and the total
authorization dollars dropped by more than half.
You know, the numbers for small businesses in Massachusetts
were even worse. Only about half as many of them got help from
the Bank after your shutdown as before it. So your shutdown of
the Bank cost Massachusetts jobs, it cost jobs in other parts
of the country. You have apparently now reversed your position
on the Bank. But I noticed in your written testimony you do not
give a single reason for the reversal.
So I want to ask this question. Will you admit now that
your crusade to kill the Bank was a mistake?
Mr. Garrett. Thank you, Senator. As I answered previously,
my statements, my positions, and my votes with regard to Ex-Im
during my tenure in Congress are a matter of public record.
Senator Warren. Yes.
Mr. Garrett. Today I am trying to make my positions as
clear as I possibly can to you.
Senator Warren. Well, then that is why I am asking you.
Mine is really just a yes-or-no question. Will you admit that
your crusade to kill the Bank was a mistake?
Mr. Garrett. Thank you, Senator. As I have said, there is
something new that has occurred since 2015.
Senator Warren. I am sorry. Is that a yes or a no?
Mr. Garrett. Thank you. Since 2015----
Senator Warren. I am still not hearing a yes--can I just
have a yes or no?
Mr. Garrett. I appreciate that, and I know oftentimes when
I was on the other side, in your capacity, asking for a yes or
no, sometimes it does not necessarily fit with the answer. So I
am trying to give you the full answer, and put it in context.
Senator Warren. Well, actually, let me--let me just do
this, in the interest of time, because I know we are running
out of time here. If you are not willing to say that your prior
efforts to kill this Bank were a mistake, but now you want us
to believe that you are going to try to run a fully functioning
bank if you are confirmed, we have a real problem. I think it
looks like you have done what is politically convenient. When
you were in Congress, the far right and the Koch brothers
wanted to kill the Bank so you took up their cause, and now it
is politically convenient for you to approve of the Bank so you
can get a job in this Administration.
You have not given us a single principled reason for this
change. This Bank needs help--I understand that--and it needs
change, but it needs a serious leader to do that, and I cannot
imagine entrusting this effort to someone who is so obviously
willing to blow with the political wind.
If the President is serious about having a functioning
Bank, then the President needs to nominate someone to be put in
charge who is committed to making that Bank function and has a
history that demonstrates that.
Thank you, Mr. Chairman.
Chairman Crapo. Senator Corker.
Senator Corker. Thank you. I thank all of you for your
willingness to serve and I am not coming at this question with
any agenda. We have had a debate, I guess, through the years
about Ex-Im Bank, and there has been a debate about whether,
you know, it actually fills a role that otherwise cannot be met
by the private sector. And then there has been a debate on the
other side, and truly, I have been ambivalent about it in many
ways. I understand that all of you are going to be confirmed, I
hope, and that the Bank is going to continue on.
But, you know, it was set up--it is a policy of the United
States that the Bank and the exercise of its functions should
supplement and encourage and not compete with private capital,
and we have walked through some of the checklists that occur,
you know, asking about whether you are able to get private
financing, and people just say yes or no. We realize that is
not a very strenuous test.
And I have seen Boeing, and I know we keep using Boeing
because they obviously from benefited from this. I have nothing
whatsoever against Boeing. I am glad they are located in our
country and build outstanding aircraft. But they have really
flourished since there has not been a quorum, and they have
been able to continue to do what they are doing, it seems,
exceptionally well.
So if we could just have a discussion with the 3 minutes
and 35 seconds we have left, a little bit about that. And I
will start maybe with you, Spencer, since no one has paid any
attention to you yet. Talk to me a little bit about, as you all
carry out these duties, this tension that exists where we would
like to make sure that the United States manufacturers have
every advantage other countries have, and their manufacturers.
At the same time we do not wish for this to end up crowding out
private capital. And, by the way, the world has changed
dramatically since this began. I mean, capital markets are very
fluid, they are there.
So talk to me a little bit about this tension that we have.
Mr. Bachus. Well, you are exactly right. I have had some of
the same concerns. President Reagan actually was the one that
put in some of the requirements that the Bank make a profit.
And, he had the same debate and came down on the side that
there are times when other ECAs--and at that time there were
about 20 ECAs--were offering aid to foreign corporations and
the United States' Export-Import Bank should do the same, to
level the playing field even though some people may call it as
a subsidy when there was private funding available.
The Ex-Im charter says that it will try to do that. I have
talked to a lot of the banks and they consider themselves
partners, not adversaries. I have not had one say that Ex-Im
has filled that role.
But let me give you a quick example of where the Bank is
essential. There was a poll of the seven largest construction
companies in the United States that do business overseas, and
all seven of them said that the contracts they bid on, 77
percent of them required ECA funding. And so they were not
eligible to bid on 77 percent of those contracts because Ex-Im
was not available. So what they did is they partnered with
foreign construction companies to get that, and the goods and
the services were supplied by foreign companies. You are
talking about Bechtel, Fluor. You are talking about, really,
tens of billions of dollars of lost opportunities.
It is such a nuanced thing. For instance----
Senator Corker. Let me do this, if I could, to get just
another point of view, and thank you for that.
Claudia, do you mind, since you have been part of Ex-Im in
the past, could you help illuminate that ambivalence that I
have?
Ms. Slacik. Certainly, Senator. I think as Spencer says,
leveling the playing field is important, and we are not
supposed to compete, and as Chief Banking Officer we went
through a lot of work to make sure that we were not competing
with the private sector. First of all, the companies had to
certify it, then we talked to banks to find out if they were,
in fact, willing to provide the financing, and then we, amongst
ourselves, talked about the state of the capital markets and
could, in fact, the private sector capital markets provide the
financing that we were.
So we did a lot of due diligence about this, and one of the
areas, I think, that is not being mentioned so much is what we
do for small business, or what the Bank does for small
business----
Senator Corker. And now----
Ms. Slacik. ----assuming the risk for the small companies,
that banks are not willing to do.
Senator Corker. But in your mind, having been there, you
truly believe that without Ex-Im Bank, United States--companies
that are based here would be at a disadvantage to people around
the world and that capital markets cannot meet the needs, in
many cases?
Ms. Slacik. Sir, I know it. In 2016, the financings of the
Bank were $200 million. China was $34 billion. That is 170
times. France did $9 billion. Great Britain did $3 billion,
while we did $200 million----
Senator Corker. Yeah.
Ms. Slacik. ----leaving it only to the private sector.
Senator Corker. Thank you for letting me go over a few
minutes. I thank all of you. Thank you.
Chairman Crapo. Thank you. Senator Heitkamp.
Senator Heitkamp. Thank you, Mr. Chairman. In the audience
today are a couple of folks that I met, one from North Dakota,
Kristin Hedger, is here, and Steve from California, who was a
champion, Vietnam vet, a champion for the Ex-Im Bank because it
was so critically important to his operation. And at great
cost, Mr. Garrett, at great cost, they traveled here, they
talked to the Media, they talked to members, and they wondered
why the heck they did not have an Ex-Im Bank.
And I had to answer that question for them all the time. I
had to say because the ideological right has decided it is not
a worthy institution. You embody the ideological right on this.
When you were asked earlier, you said, no, now there is a new
change because now we believe in a stronger economy, with
stronger exports. We cannot have a strong economy without
strong exports. You have opposed the Bank, not in the last
iteration of reauthorization, but for a long time. That is
correct, right?
So let me give you some numbers. From 2013 to 2016, the Ex-
Im Bank supported almost a half a million good-paying, middle
class jobs. If you had your way in the 2012 reauthorization,
those middle class jobs would have gone to other countries.
Additionally, from 2013 to 2016, the Ex-Im Bank sent to the
taxpayers, the Treasury, $2.5 billion--$2.5 billion for
reinvestment in priorities by the Congress. The default rate
during a similar period of time was less than 0.5 percent--0.3
percent, 0.3 percent default rate for a development bank.
And so now, after the last reauthorization, which we fought
very hard for, you issued a press statement that said in a move
that epitomizes Washington's addiction to crony capitalism,
Congress resurrected a dead Government welfare program by
voting to reauthorize the Export Bank today, and you went on to
say, ``I will continue to fight to finally put an end to the
Ex-Im's corruption of the free market system.'' And today,
despite two opportunities here, you have refused to say you
were wrong, that you owe an apology to the business people in
this room who need the Ex-Im Bank.
Will you, today, apologize to all the businesses and all
the workers who have lost their jobs because all the back-and-
forth, because of ideology and lack of common sense? Will you
apologize to those businesses today for shutting down the Ex-Im
Bank and causing them economic harm?
Mr. Garrett. I appreciate that question, Senator. Chairman
Bachus made reference to the American dream which was to own a
home. And I think he was correct that you cannot own a home
unless you have a job and that you actually, nowadays, have to
have a good-paying job.
As I said, Senator, to facilitate getting those good-paying
jobs, you need to have a strong manufacturing base. To
facilitate doing that, we need to have a proverbial level
playing field. My commitment to you, Senator, is to see to it
that now that Congress has passed the reforms of 2015----
Senator Warren. Mr. Garrett, you have said the same thing
over and over again. Why is it so hard for you to say you were
wrong about the Bank? Why is it so hard for you to say that the
Bank is a critical and essential piece of trade infrastructure,
of business infrastructure, and job infrastructure that you
were wrong about, and that you now want to strengthen, but you
were wrong? Why in the world would we give you a job when you
refuse to say that you were wrong about your past statements
about the Ex-Im Bank?
I just--I am merely--I am not trying to be argumentative. I
just need to know that you are not there as a saboteur, that I
am not going to be fighting this fight on reauthorization, if I
am given a chance to come back here. I believe in this Bank and
I am not sure you do, and that is a big problem for me.
So can you acknowledge right now, in the last 10 seconds
that I have, that you were wrong about the Ex-Im Bank?
Mr. Garrett. Thank you, Senator, and to the point you raise
about reauthorization, I do look forward to working with you to
see to it that reauthorization occurs.
Chairman Crapo. Senator Rounds.
Senator Rounds. Thank you, Mr. Chairman. Mr. Garrett, I
have had the opportunity to visit with you twice privately, and
then a chance to work with your team once. The question that I
am asking is the one that I have asked in both of our private
meetings so it is not a surprise to you, sir.
Look, I truly believe that are a man of principle, and I
think, in your previous statements, you truly believed what you
have said in the past. My challenge has been--and I am going to
read these out when we do this--my concern is that, as a man of
principle, you are going to have a very difficult time trying
to make a change without an explanation of what happened.
While you were serving in the House of Representatives you
said, on multiple occasions, that you did not think that the
Export-Import Bank should continue to exist. For example,
during the debate on the 2015 reauthorization of Ex-Im, you
said the following on the House floor--and, by the way, these
are exactly the same quotes that I have asked for written
comments on twice now, and I am still waiting, if you do not
feel comfortable trying to answer them today verbally.
``In June of this year''--this is your quote--``In June of
this year, after 81 years of doling out taxpayer-funded welfare
for mega-corporations, the American people said enough and
Congress let the Export-Import Bank expire. Yet today, through
a little-known and little-used legislative maneuver being used
to circumvent the will of the American people, they are
resurrecting this fund for corporate welfare.
``The Export-Import Bank transformed the role of Government
from a disinterested referee in the economy into a biased actor
that uses your taxpayer dollars to tilt the scales in favor of
its friends, and it mocks the American dream by making victims
of the startups that dare to compete. If we promoted
responsible Government policies, responsible budget policies,
expanded free markets, lowered and simplified the income taxes,
and repealed onerous regulations, American businesses would
thrive in the global markets.
``But none of that is on the table today, on what we are
about to consider. Instead, the proposal before us is the
resurrection of a bank that embodies the corruption of the free
enterprise system. Yes, we have the opportunity today to save
capitalism from cronyism. Yes, we have the opportunity to
protect the American taxpayer, and the American dream, and to
preserve free enterprise. We have the opportunity today to keep
the Export-Import Bank out of business. We should take each of
these opportunities.''
In addition, when you were speaking at an anti-Ex-Im press
conference in 2015, you said, and I will quote, ``It is hard to
imagine anything more unfair and un-American than having the
Government financially support mega-corporations at the expense
of small businesses and American workers, but that is exactly
what has been happening and it will continue to happen if we do
not let the Export-Import Bank expire next month. It rewards
those with close relationships with Washington bureaucrats and
makes victims of startups that dare to compete against them,
literally picking winners and losers in our economy.
``Ex-Im has transformed the role of Government from a
disinterested referee that guarantees a free and open
marketplace into a biased actor that tilts the scales in favor
of its friends and businesses. We have the opportunity to save
capitalism from cronyism and to fulfill a promise to the
American people to work for them instead of a select few with
special connections in Washington. For the sake of the American
taxpayer and preservation of the free enterprise system,
Congress should put the Export-Import Bank out of business.''
My question, the same one that I have asked twice now,
personally, and the question that I still think you need to
share with us, as a man of principle, I believe that you truly
believe the statements that you made. What would have made you
change your mind about whether or not the Export-Import Bank
should exist? And I think this is critical that you be able to
share what has changed your mind.
Mr. Garrett. Thank you, Senator, and again, thank you, as I
said at the outset, for spending time not once but twice to
meet with me to discuss these things and to go over your
concerns. I appreciate that.
So one of your colleagues, who I think has left now, had
made the statement that she, too, agrees that even now that Ex-
Im Bank needs help, to quote, ``needs change.'' Even now, after
the 2015 reform it needs to be changed. In 2015, when a lot of
those quotes were taken from--and I did not write all the dates
down when you said them--when we wrote the reauthorization bill
and--I believe my colleague to my right made reference to this
as well, the Chairman--that many or some of those changes were
also asked back in 2012, and they were not effectuated. And
many of those changes----
Senator Rounds. I apologize. I am out of time----
Mr. Garrett. Yeah.
Senator Rounds. ----and it is my statement that made us out
of time.
Mr. Garrett. OK.
Senator Rounds. ----if you would, would you commit to
sending, in writing----
Mr. Garrett. ----something to you? Sure.
Senator Rounds. ----an explanation, please----
Mr. Garrett. Yeah, yeah, yeah.
Senator Rounds. ----because I still think it is a matter
of--and this is the critical part--if you are philosophically
opposed to the concepts, and if you truly believe that this
bank represents crony capitalism, by definition, I think it is
more than just simply asking for a reform. I think it is a
matter of whether or not, as a principled man, you truly
believe that this bank can operate without being a part of a
crony capitalist organization, sir.
Mr. Garrett. Thank you.
Senator Rounds. But I would appreciate that in writing.
Thank you. Thank you, Mr. Chairman.
Chairman Crapo. Senator Donnelly.
Senator Donnelly. Thank you, Mr. Chairman. Thank you to all
the witnesses and to your families.
Mr. Garrett, here is what I do not get. When you have been
opposed to this for so long, and said such things about the Ex-
Im Bank, why on earth do you want to run this thing when you
have been so opposed to it? It makes--it seems the exact 180 of
the positions that you have taken before, and it makes it very,
very hard for all of us to take this seriously when you say
these things and when we see crony capitalism and we see other
things.
Why on earth do you want to do this when this organization
is something that I have supported nonstop, and basically
battled against you for years on, fighting for its survival, I
now look up and you want to be the head of an organization that
you have been against forever?
Mr. Garrett. Thank you, Senator. I am excited to be able to
be potentially, if confirmed, in the position to lead the
organization. It would be in that position that I would be in a
different role than I was when I was in Congress. This would be
an executive role, and it would be in that role, at that
point--maybe this goes to your question, to some extent,
Senator--I actually would carry out the full extent of the
reforms that Congress has been asking for years, in order to--
--
Senator Donnelly. But, Congressman, let me ask you this.
Mr. Garrett. ----in order to effectuate what should be
done.
Senator Donnelly. It was not about reforms. You did not
think it should even exist. And when I talked to you a few
months ago, I asked you, do you personally believe we should
have an Export-Import Bank, not whether you have been appointed
by the President and so this is your mission or whatever. Do
you personally believe there should be an Export-Import Bank?
And you refused to answer that question, so I will ask you
again. Do you personally believe that we should have an Export-
Import Bank in this country?
Mr. Garrett. Yes, Senator, I do not remember the exact
exchange but I will give you the answer here. So, yes, Congress
has passed legislation to do what? To get to the level playing
field that does not exist in the world today. There are, as has
been alluded to, or actually not alluded to but referenced by
my colleagues to the right, numerous countervailing factors
that currently weigh against manufacturers in this country. Ex-
Im is an element to be able to deal with that.
Senator Donnelly. Well, the question is, do you personally
believe in the mission of the Ex-Im Bank, and if so, what has
changed from a few years ago?
Mr. Garrett. I believe that Ex-Im is an element--maybe
``element'' is not a good word--how about a tool in the
toolbox, might be a good expression to be able to deal with----
Senator Donnelly. Well, why wasn't it a tool in the toolbox
when you called it crony capitalism?
Mr. Garrett. And again, this goes to your question, so
maybe I can give an answer to the question here as opposed to
giving it in writing.
Senator Donnelly. But you think there has been such
significant changes that now it is not crony capitalism?
Mr. Garrett. What we want to address----
Senator Donnelly. No, it's my turn now.
Mr. Garrett. I know. I know. I just remembered one of the
questions but I do not want to bring up a private conversation.
Senator Donnelly. Do you believe it is not crony capitalism
now?
Mr. Garrett. So what I believe is what we need to have is
openness and transparency and all businesses can make
themselves available to the assistance.
Senator Donnelly. I--you----
Mr. Garrett. So that you are not picking winners and
losers, Senator.
Senator Donnelly. Let me ask you this. You go to 2019, we
have reauthorization coming up, as my colleague, Senator
Heitkamp, was talking about. Are you going to fight for the
reauthorization of Export-Import Bank and for its continuance?
Mr. Garrett. The short answer is yes. I think I began to
answer that in the last closing 10 seconds of a previous
question.
Senator Donnelly. Well, what will you say to your former
House colleagues who--our former House colleagues--who you told
it was crony capitalism, who you lined up to attack this, to
try to put it out of business? This has helped an incredible
number of Indiana companies. When they look and they go,
Congressman, you know, 3 years ago you told me this was crony
capitalism and it is the worst place on earth. Why should I
believe you now, other than you wanted the job?
Mr. Garrett. So, Senator, I look forward to working with
all Members, from all perspective, on both sides of the aisle,
with regard to the reauthorization process, to explain what
has--by that time--transpired within Ex-Im and to explain that
to Members.
Senator Donnelly. Well, I know my time is up. I want to
thank all the witnesses for being here, and, in particular, I
want to tell the Pryor family and their young son, who is such
an extraordinary young man, how proud we are of him. Thank you.
Chairman Crapo. Thank you. Senator Shelby.
Senator Shelby. Thank you, Mr. Chairman. I have long held
reservations about the Export-Import Bank operating in its
current form. Just a couple of years ago, we had 2 days of
hearings trying to come up with some way to reform the Export-
Import Bank, right here in this Committee, to no avail.
I believe that the Export-Import Bank is now rampant with
corporate cronyism, corruption, and unaccountability. Some
would like you to believe that the Export-Import Bank solely
helps small businesses. This is simply not the case. Latest
estimates indicate that the Export-Import Bank finances only 2
percent of total U.S. exports. This means 98 percent of exports
from the United States are generated without the Bank's
financing. You need to think about that.
What is more, less than one-third of the Bank's activities
are actually designated to offset the effects of foreign
subsidies. Over 50 percent of the Bank's subsidies are directed
for use that has no justification provided, according to their
records.
Latest estimates indicate that the Bank, as I said, only
finances 2 percent. In one of the last 2 years that the Bank
operated with a quorum, the top 10 beneficiaries profited from
75 percent of the Export-Import Bank's total financing. The
Bank, in its current form, does not function to help small
businesses, that I have indicated. In addition, we are all
familiar with the case, up here, of the Export-Import loan
officer who accepted bribes for approving unqualified loan
applications.
However, the story is not the cause of the illness that is
the Bank as it operates today, but rather--and I believe it is
a symptom of a much larger problem. Between 2007 and 2014,
there were 792 reported claims of fraud at the Bank. This
corporate cronyism also extends to the gray areas of the Bank's
operation, to practices that certainly skirt ethical lines of
doing business.
The Wall Street Journal has reported that in 2012, Boeing
worked directly with Export-Import Bank officials to create
tighter rules for aircraft loans that would benefit Boeing and
help crowd out their competition.
Are these truly practices that this body should look to
continue? I hope not.
I am never one to begrudge businesses for being successful.
We want them all to be successful. However, the problem with
the way the Bank currently operates is that it puts American
taxpayers on the hook for deals that these large businesses
could independently finance.
Some large businesses have enough capital to buy their own
bank. GE, for example, previously owned one of the largest
nonbank banks in the world. These large corporations do not
need the Export-Import Bank to run an efficient export
operation. In fact, recent data provided by the Mercatus Center
estimates that exports are rebounding in 2017, even without a
quorum to finance larger transactions at the Export-Import
Bank.
And as Dan Griswold, the codirector of the program on the
American economy and globalization at the Mercatus Center
stated, ``The bottom line is that U.S. export growth was
decelerating beginning in 2012, and has picked up again in
2017.'' The Export-Import Bank's status was simply not a
factor.
The truth is there are those in our country today who are
concerned that their gravy train has run dry and they want it
to restart at the expense of the taxpayers.
Mr. Chairman, for the record I would like to submit five
articles, as well as one data set for the record, to provide
evidence of the claims that I have just made. These are the
Wall Street Journal piece from March 12, 2015, ``Boeing Helped
Craft Own Loan Rule''; one article from the Heritage
Foundation, ``Export-Import Bank Propaganda Versus Facts'' by
Diane Katz; three articles from the Mercatus Center, ``The
Biggest Beneficiaries of the Export-Import Bank'', ``Key
Argument for Export-Import Bank Invalid'', and ``Celebrating
Our Independence From the Export-Import Bank''; one data set
from Veronique de Rugy, Senior Research Fellow at the Mercatus
Center.
Chairman Crapo. Without objection.
Senator Shelby. Mr. Chairman, I want also to associate my
belief with what Senator Toomey had to say earlier. I believe
that Mr. Garrett is a man of principle. I worked with him when
he was on the Banking Committee. I believe he would make an
excellent--he is a principled man, and we need those kind of
people at the Bank. I hope that we keep everybody together and
we confirm everybody. If we do not, we will see what we can do
to slow the process down, because the Bank is still corporate
welfare.
Thank you.
Chairman Crapo. Thank you. Senator Van Hollen.
Senator Van Hollen. Thank you, Mr. Chairman, and welcome to
all of you. To my old colleagues from the House, Spencer and
Scott, it is good to see all of you, and congratulations, all
of you, on your nominations.
Let me just start by responding a little bit to Senator
Shelby's comments, because we have here in the audience a
number of representatives of Maryland businesses, and these are
not big blockbuster businesses. These are small- and medium-
sized businesses that have benefited in their work overseas, as
a result of the Ex-Im Bank. We have someone here, Kip Freemann
from Triumph Electronics, and they are a great employer in the
State of Maryland. We have someone from BTE Technologies from
Hanover, Maryland. They develop physical evaluation and
therapeutic rehabilitation outcome equipment.
In fact, 75 percent of the businesses in Maryland that
benefit from Ex-Im are small businesses, and the Ex-Im Bank
support, credit support, resulted in $331 million worth of
authorizations in Maryland. And so I am pleased to say that
when it comes to Maryland, we have got a lot of small- and
medium-sized businesses that would not have that business but
for Ex-Im. In fact, one-quarter of the employees of BTE are
directly associated with their foreign sales that are helped by
Ex-Im Bank.
And, you know, the issue here is we do not have a world
where everybody is operating under the rules of the economic
textbooks. We are dealing with competitors who are putting
their feet heavily on the scale in support of their businesses.
And we are never going to be able to compete entirely with
China. We do not want to compete with China in that regard. But
you cannot bring a pea-shooter to a gunfight, and we need to
make sure that we support those businesses who are facing
unfair--unfair competition overseas from China. I mean, I think
we have seen, in the most recent party Congress that just
wrapped up, that they have a, sort of--their game plan is to
dramatically extend their economic footprint, not just in that
region but around the world. And if we do not at least provide
some help to our folks to support jobs at home, then we are
going to get crushed when it comes to that competition, as good
as our businesses and companies are.
So I wanted to ask the nominees to Ex-Im Bank about a fund
that has been part of the Ex-Im Bank called the Tied Aid Fund.
This is a fund, about $165 million, that has been used as a
flexible fund to say to a country, you know, if you do this
business deal with the American business and support American
jobs, we also may be able to help you on a minor infrastructure
project, or whatever it may be.
Now I know that kind of violates the rules of straight
economics. Everybody gets to bid on the project. But anybody
who has been to Africa or any other part of the world knows
that China is killing us when it comes to these deals. And we
can either say we are going to live in a textbook world that is
not real, or we are going to at least provide some opportunity.
So I am interested in your positions on that particular
fund, because that fund was eliminated in the proposed budget
from the Administration. And maybe we just go down the line and
start with Mr. Garrett.
Mr. Garrett. Thank you, Senator, and good to see you----
Senator Van Hollen. Good to see you.
Mr. Garrett. ----since our budget days.
Two points. The first point is to say that I am glad to
hear that some of your constituents are here today, and, should
I be confirmed, I would look forward to meeting them in person
along with you, on a visit to learn more about the one company
that says one-third of its business is from that industry is
from the Export Bank.
Second, yes, the goal here is ultimately what?--the
creation of jobs, these Maryland jobs or anybody else's jobs.
If this aid is an element in the toolbox--my expression--that
facilitates the creation of jobs, then that is fine. If it ends
up that it is actually coming via a cost that is a negative,
then no. But the ultimate question that you have to ask, as any
deal that comes through, is will this actually produce and
sustain American jobs.
Ms. Reed. Senator, thank you very much. President Xi
Jinping just incorporated the Belt and Road Policy into the
Communist charter--just the past few days--and we know that
they have plans to do infrastructure in 60 countries. I have
traveled all around the world where I have seen that in action.
As I quoted Chairman Archer, I do not believe in unilateral
disarmament. And, I look forward to conversing with the Senate,
if I am confirmed, about the role that tied aid could play in
that. Thank you.
Mr. Bachus. Thank you, Senator. The OECD, at one time,
tried to control other countries' offering these same benefits.
But in the last 3 or 4 years, that dam has broken. And they all
offer even more incentives than we do. We are at a
disadvantaged level with respect to the jobs we are able to
capture. We do not level the playing field with Ex-Im. We tilt
it a little more to our favor. And there have been some recent
articles from think tanks, talking about the OECD, and how they
have taken advantage of the shutdown.
Senator Van Hollen. Yeah. Thank you, sir.
Ms. Pryor. Senator, thank you for that question. I am not
familiar with all of the specifics of the Tied Aid program but
if I am confirmed I will look forward to working with my
colleagues and learn more specifically about that program.
What I can tell you is that I will commit to you that I
will implement the charter as it has been authorized by
Congress, and if these tools are available to help us grow
small business exports, and help us level the playing field,
then I will definitely be supportive.
Ms. Slacik. Senator, during my time at the Bank, which was
for 2\1/2\ years and billions of dollars of approval, not one
of those involved Tied Aid. We did not feel we needed to do
that.
Senator Van Hollen. Right. The issue now is given the
increased use of Tied Aid by other countries, whether we should
have that in our toolbox.
But thank you, Mr. Chairman.
Chairman Crapo. Thank you. Senator Scott.
Senator Scott. Thank you, Mr. Chairman. Thank you to the
panel for being here this morning. I hope that the five of you
do not feel left out of the conversation that most of us are
having with Mr. Garrett. If you do, we will be happy to share
the love with all of you. I am not sure that I would recommend
that, but we will just move on.
Mr. Garrett. I will be happy to defer all future questions
to my colleague, the vice-chair.
Senator Scott. There is wisdom in all things sometimes.
Mr. Garrett, you wrote me a letter and I think you were
fairly clear. You said, and I quote, ``To be absolutely clear,
I pledge to keep the Bank fully operational and serving the
functions that Congress intended with this last
reauthorization.'' You have restated that with great clarity
during this hearing, and I thank you for that.
You have said, just a few minutes ago, as it relates to the
reauthorization in 2019, of the Bank, you said the short answer
is yes. You, as President of the Ex-Im Bank will be supportive
of the reauthorization. Did I misunderstand your position at
all?
Mr. Garrett. Do you want the short answer?
Senator Scott. I want the short answer.
Mr. Garrett. No, you did not misunderstand.
Senator Scott. Thank you.
The one question you have not answered is the one that is
the simplest of questions. It is the question, what has
changed. The one question that I have not been able to discern
your position is why has your position changed. Your previous
comments, that have been--we have heard about it for the last
hour and a half or so--your previous comments and position are
in clear contradiction with your current position and comments.
The one thing that most of us know about you is that you
are typically unambiguous, clear as a bell. You have
consistently taken a position of character and integrity, and
the question on the table is, what has changed? And a part of
the answer that most of us seek, or perhaps, more importantly,
the reason for the change is perhaps more important than the
change. In other words, if we can understand the clear
rationale for the change, it certainly will give more
confidence to the position.
So I will only ask the question one more time, because if
the answer takes a--if the answer does not head in the
direction of why the change then it will reinforce the fact
that there is no clear answer that we can digest.
Mr. Garrett. Thanks again, Senator, and thanks for the time
that we had----
Senator Scott. I appreciate you taking the time.
Mr. Garrett. ----yeah, to come over and sit down and chat.
So to put it numerically but not necessarily in this
order----
Senator Scott. Yes, sir.
Mr. Garrett. ----I would say a couple of things have
changed, again, not necessarily in this order. My role has
changed. I am not in a legislative function. If I am confirmed,
I would be in an executive function, and as such--and that is
what I tried to make clear as best as I possibly can--I
commit--and you say I am a sincere person, or you had said
other nice words--when I do commit, I do commit sincerely to
carry out the letter of the law as established by Congress. I
was frustrated because that law was not being followed under
the previous Administration. So the first point is my role has
changed.
The second point is----
Senator Scott. Stop. Let me ask you a question there.
Mr. Garrett. Yep.
Senator Scott. Just to be clear. You will carry out the
letter of the law and the spirit of intent----
Mr. Garrett. Yeah.
Senator Scott. ----of the law.
Mr. Garrett. Yes.
Senator Scott. All right. Please continue.
Mr. Garrett. That is good. Yeah. That is--to carry out the
letter of the law and the spirit of the law. The spirit of the
law is overarching, which goes to the Chairman's question, when
he was over in Budget.
Senator Scott. Van Hollen.
Mr. Garrett. Yeah.
Senator Scott. OK.
Mr. Garrett. The spirit of the law is ultimately how do you
create more jobs while protecting the American taxpayers, and
that is--I am 100 percent in on that as well, and this goes to
your----
Senator Scott. All right.
Mr. Garrett. ----to your question as well. That is why I
used the word--I think when I met with you, if I may, I think
this is a neat opportunity to be able to actually carry out
those things to get to fruition, protect the taxpayers, which
is a passionate concern for me, on the one hand, and also to
carry out----
Senator Scott. I am not sure how long Chairman Crapo will
give me extended time, very little. But, so, first, your
position has changed because you role and responsibility as a
legislator to the President of the Ex-Im Bank would clearly
change your advocacy position?
Mr. Garrett. Yes. Yes.
Senator Scott. Is there any other reason?
Mr. Garrett. And the second reason is what I have said at
several different times, is that now we have a new
Administration in town that actually helps facilitate this,
which we have not had for X period of time.
Senator Scott. Well, Mr. Chairman, Mr. Garrett, I will say
that when you read the bylaws of the Bank, you realize that the
president of the Bank is in charge of the business of the Bank,
it is in charge of the Board, it is in charge of the businesses
that come before the Bank as it relates to how the Bank will
operate. It also has the power--the president has the power to
basically hire, fire the employees, the attorney, and the
agents.
So the overarching question, as it relates to the change,
is incredibly important----
Mr. Garrett. Sure.
Senator Scott. ----as it relates to our confidence in that
change.
Thank you, Mr. Chairman.
Mr. Garrett. And thank you, Senator.
Chairman Crapo. Thank you, Congressman. Senator Tester.
Senator Tester. Thank you, Mr. Chairman. I want to thank
you all for being here today. You can answer my first question
with a head nod. Do you want my vote for your confirmation?
Let the record reflect that they all nodded yes.
Chairman Crapo. Six head nods.
Senator Tester. Mr. Garrett, we have not met before, and I
appreciate you all putting yourselves in this position to be
confirmed. And I am going to preface my questions by, look, we
have all been behind this dais in one form or another, and some
of us have been on the other side of the dais in one form or
another, and we all know how to skate through questions and not
answer them if we want. But I will tell you that you will not
get my vote if you do not answer my questions. OK?
I am going to start with you, Mr. Garrett. Do you believe
that the Ex-Im Bank is corporate welfare?
Mr. Garrett. If Ex-Im is not properly operated, if it is
not open and transparent, if it does not comply with the laws
of 2015, it could be.
Senator Tester. Do you believe that, in the past, it has
been corporate welfare?
Mr. Garrett. Yes.
Senator Tester. OK. And what changes--very briefly, because
I do not want you to filibuster me--what changes would you make
to ensure that it is not corporate welfare?
Mr. Garrett. OK. Very briefly. So at the very top of the
list is--are the reforms in 2015. First is--not necessarily in
this order, the ethics reforms, which goes to a couple of the
questions that were raised today already, and I can go into
more detail if you want.
Senator Tester. Yep.
Mr. Garrett. Second would be the risk management provisions
that were added into the----
Senator Tester. OK.
Mr. Garrett. ----the reform as well.
Senator Tester. Yep.
Mr. Garrett. And third, I guess would be in the area of the
culture of the agency as well. The expression I--the term I
borrowed, I think----
Senator Tester. Yep.
Mr. Garrett. ----is a tier one organization----
Senator Tester. Yep.
Mr. Garrett. ----so that each--is that satisfactory?
Senator Tester. OK. Good. Do you believe, Mr. Garrett, that
a robust Ex-Im Bank is a necessary tool for job creation in
this country?
Mr. Garrett. So, again, thank you. Alluding to some of the
other questions asked, more flesh to it, my answer is yes, it
goes back to the term I use all the time is the toolbox
expression, I guess.
Senator Tester. Yes, but there is a difference between an
Ex-Im Bank and a robust Ex-Im Bank. There is a difference
between an aggressive Ex-Im Bank that is out there looking for
job-creating opportunities and a bank----
Mr. Garrett. OK.
Senator Tester. ----that sits back.
Mr. Garrett. Gotcha.
Senator Tester. Thank you.
Mr. Garrett. Sorry.
Senator Tester. That would be yes?
Mr. Garrett. Yes. Yes.
Senator Tester. OK. Could you also--because you spoke
earlier about reforms--could you give me--not now----
Mr. Garrett. OK.
Senator Tester. ----before your confirmation, though, a
list of the reforms that you would do if you are confirmed as
chairman?
Mr. Garrett. Oh, certainly.
Senator Tester. Perfect.
Let me ask you this. Your position, if confirmed----
Mr. Garrett. Senator?
Senator Tester. Yes?
Mr. Garrett. If I am allowed, is there any particular area
you wanted me to focus on?
Senator Tester. No. I just want a list, and you can write
them as long as you want or you can make them as short as you
want.
Mr. Garrett. OK.
Senator Tester. I appreciate that.
You have a lot of powers as Chairman of this Committee, and
I am not going to get into the fact that--because it has
already been said by other folks--that this is a really, really
important potential, incredibly good job creator, and that your
past statements, by the way, have not been especially glowing
toward the Ex-Im Bank. And so all of us that have concern about
that--and there has been concern on both sides of the dais up
here--makes us think that maybe there is another agenda out
there that you might have, once you get confirmed, to try to
upend the Ex-Im Bank. Regardless of what you say today, past
history is past history, we learn from the history to go
forward.
So let me ask you this. The agenda is set exclusively by
you on this Board. Would you agree today--and this may make the
difference of whether I vote for you or not, by the way--that
if two of your members came forward and said, ``We want this
agenda item on the agenda,'' that you would agree to do that?''
Mr. Garrett. Thank you, Senator. I would have look into
what the charter provided in that regard. I do believe that
there are already some provisions in the charter that do allow
for members of the Board to bring matters to before the Board.
Senator Tester. My understanding is that you control the
agenda. Would you allow two members to come forth with the
recommendation, and would you give them the common courtesy--if
two members come through, maybe two Democrats, maybe two
Republicans, maybe one of each--that you would put that agenda
item on your agenda?
Mr. Garrett. Yes. Again, I would have to look into it. I
believe that already, with regard to----
Senator Tester. OK.
Mr. Garrett. ----the policy matters----
Senator Tester. Let----
Mr. Garrett. ----that is already the case with two members
wanting to bring forth agenda items.
Senator Tester. OK, but if it was not, you would agree to
it.
Mr. Garrett. If it was not, Senator----
Senator Tester. It is a pretty simple question. I mean,
these are good people. I mean, they are good stuff. Bachus was
almost from Montana. I mean, these are good folks.
[Laughter.]
Senator Tester. Yeah.
Mr. Bachus. Alberta.
Mr. Garrett. I will comply with the law, Senator.
Senator Tester. But that is--and I--we are all going to
comply with the law. What I am asking, would you be open, if
two people came forth to you with an agenda item, put it on the
agenda, you would do that--and I will tell you why this is an
important question for me, because it eliminates--I like all of
them. All these guys have said, unequivocally, you have got
your past baggage you have to take care of. That is done, done,
but the truth is if you had an opportunity for two of these
people to come forth to say ``we want to talk about this
potential deal,'' that you would put it on the agenda, takes
away any potential agenda opportunity that you might be able to
manipulate this Board to go back to your past.
Make any sense? So would you agree to it? You wanted my
vote.
Mr. Garrett. It would be premature for me to make a
decision without reviewing what the bylaws say and what the
positions are. Thank you, Senator.
Senator Tester. No, no, no, no, no, no. Look, I--just 1
second, because I think I am the last one here besides you, Mr.
Chairman. But I have got to tell you, Mr. Garrett, I have just
got to tell you, I do not care if you are Democrat or
Republican as long as you are willing to do the job that is in
there. You have got a past history that you never really fully
explained here today. You talked about role and you talked
about a new Administration, but the fact is you made it clear,
in a past life, that you did not like this outfit, and you have
really not answered any of those questions. You have juggled
it. Hell, I have done the same thing. It is not that big of a
deal. Any of us can not answer questions.
That is not how you get confirmed around here. And I would
just tell you that when you have got four good people sitting
up here who, by the way, I am going to vote for every one of
you because you answered all my questions. I did not ask you
any, but I asked them all.
[Laughter.]
Senator Tester. But the truth is you have got four good
people up here that are very capable. They are probably making
the same amount of money you are on the Board. Why not give
them the opportunity to have an influence on the thing,
especially since you have this past that is questionable. We
are all going to follow the law. The question is, if you take
the initiative to be able to empower the other members on this
Board, it is going to make this Ex-Im Bank much more effective,
and that is really the question.
Mr. Garrett. Thank you, Senator.
Senator Tester. But you will not answer it. Gosh, darn it.
And people wonder why we do not like Washington, DC, Thank you
all for being up here and I appreciate your willingness to be
put through this process.
Chairman Crapo. Thank you, Senator, and that concludes the
questioning portion of the hearing. I again thank each of you
for coming and for your willingness to serve our country.
For the Senators, all questions for the record--and you
will probably receive further questions--all questions for the
record are required to be submitted by Friday, as early as
possible on Friday. And for our witnesses, I would ask your
responses to those questions be made to us by Monday morning,
so this may require some weekend work.
Mr. Bachus.
Mr. Bachus. Senator Crapo, as part of my prepared remarks,
I talked about my friendship with Congressman Garrett. We
worked closely together. I know him to be a good Member and a
man of principle. And, I do want to state that for the record.
He is not only my former colleague but he is a friend.
Chairman Crapo. All right. I am sure he appreciates that
and it is appropriate.
I see a Senator come in. Are you interested in asking
questions, Senator Cortez Masto?
Senator Cortez Masto. I am. Thank you.
Chairman Crapo. I will reopen the question-and-answer
period for you. Sorry, guys. You thought you were being cut
loose but we have got one more Senator.
Senator Cortez Masto. It will be easy, however. And I thank
you so much, Mr. Chair. I noticed my clock is not working, so
if you just give me a minute left to go----
Chairman Crapo. I will give you a minute warning sign.
Senator Cortez Masto. Thank you. I appreciate that. And I
apologize. I have two Committee hearings going at the same
time. They are in completely different buildings so they are
all over the place, so I am running back and forth.
I appreciate the conversation today. First of all, let me
just say thank you for all of your willingness to serve, or
your service already, and welcome to your beautiful family.
Thank you here for joining us.
Let me start by saying this. I--listening to my colleagues
talking with Mr. Garrett, and I do have concerns about, Mr.
Garrett, your position, but I do not know whether it is going
to do me any good to even question you, because clearly you
already have canned answers and you are not willing to let us
really know why you are here, other than what I believe is to
implode the Ex-Im Bank, and I cannot support that.
So let me get to the rest of you, because many of you have
sat there, not been able to answer some questions. And Mr.
Greenblatt, let me start with you, because I appreciate what
you do. As Attorney General of Nevada for 8 years, one of the
things we did is really look to ensure against waste and fraud
in our Medicaid system.
What are your biggest challenges or barriers that you see
as the IG moving forward, and what you need to do?
Mr. Greenblatt. Certainly. The number one challenge that we
are facing, if confirmed, would be personnel, frankly, size.
That is something, if you look at our audit team, 80 to 90
percent of our audits are statutorily mandated and have nothing
to do with bank operations. For example, looking at purchase
cards, which are the Government credit cards used to by toner,
paper, we are obligated to do an audit every year on the use of
those credit cards. That has nothing to do with the Bank. So
that is 80 to 90 percent of our audit staff every year is taken
up with that.
Senator Cortez Masto. OK.
Mr. Greenblatt. Our investigations team is quite small,
especially if look at the $30 billion in transactions that are
coming down the pike, if the Board is confirmed. Those have
been major challenges.
Senator Cortez Masto. OK. And so for the Board members
that, once elected, are you--just yes or no--are you committed
to giving the IG all the resources and working with him to give
him the resources he needs to be effective in his job?
Ms. Slacik. Yes.
Ms. Pryor. Yes.
Mr. Bachus. Let me say this. There is a very large IG
presence at the Bank. It is something like 20 or 25 IGs,
staffers, and investigators.
Mr. Greenblatt. Twenty-five personnel.
Senator Cortez Masto. OK.
Mr. Bachus. That is a very high ratio compared with most
agencies. Most agencies have 1 IG staff out of 400 or 1 out of
500. And I guess what Mr. Greenblatt said some of the
investigations have nothing to do, really, with the Bank's
business.
And I want to respond to one other thing. There was a bank
employee, several years ago, who was caught doing a criminal
activity. That was exposed within the Bank by his fellow
employees. He was prosecuted by the IGs and was turned over to
the Justice Department. It was found internally and prosecuted.
And I know one of the Senators mentioned earlier about the
fraudulent activity at the Bank. But, you know, there is fraud
in every agency.
Senator Cortez Masto. Mm-hmm.
Mr. Bachus. It is unfortunate but this agency had many
people who have tried to do fraud at the Bank. But the fraud at
the Bank has been exposed, and that is almost a good thing that
it was exposed.
Senator Cortez Masto. Mm-hmm.
Mr. Bachus. And the fraud was exposed by people in the
Bank.
Senator Cortez Masto. Thank you. I appreciate that.
Chairman Crapo. One minute.
Ms. Reed. Good afternoon, Senator. Yes, absolutely, I do
support Inspector General. I worked in Congress for 7 years
doing oversight and investigations and I see the value of that.
Senator Cortez Masto. Thank you. And let me--since I have 1
minute left, let me just say this. The Ex-Im Bank is necessary.
I come from Nevada, and I am a supporter of it. It is important
and necessary to expand and diversify just the State of Nevada
and our economy. The Export-Import Bank supports 23 Nevada
exporters, 16 of which are small businesses. One of them I had
the opportunity to meet with when I was home in August, which
is Click Bond. Click Bond designs and manufactures fastening
technology for our State in the art of aviation technology.
They have operated in Carson City for more than 30 years. They
employ 350 people and 150 people around the world, because of
the support of the Ex-Im Bank in Nevada.
Ray Bacon, who is the Executive Director of our Nevada
Manufacturers Association, supports it, and just recently he
wrote in the Reno Gazette-Journal a piece, and what he said in
there is ``manufacturing workers in Nevada and across the
United States should be worried about the nominee to lead to
the Ex-Im Bank, ex-Congressman Scott Garrett of New Jersey.
Garrett made it his mission in Congress to destroy the Ex-Im
Bank. He voted against reauthorization of the agency more than
a dozen times, and urged his colleagues to use the opportunity
to put the Ex-Im Bank 'out of business'.'' This is from Nevada
Manufacturers Association. This is why many of us have concerns
with Mr. Garrett leading the Ex-Im Bank and why I cannot
support it.
But thank you all, again, for being here today, and your
comments--answers to our questions.
Chairman Crapo. Thank you, and that does conclude the
questioning period. I have already given the final instructions
and so that will conclude our hearing.
Let me just say, again, thank you to all of you for your
participation here today, thank you in advance for your prompt
response to questions you may receive, and thank you for your
willingness to serve.
This hearing is adjourned.
[Whereupon, at 12:01 p.m., the hearing was adjourned.]
[Prepared statements, biographical sketches of nominees,
responses to written questions, and additional material
supplied for the record follow:]
PREPARED STATEMENT OF SCOTT GARRETT
To Be President of the Export-Import Bank
November 1, 2017
Chairman Crapo, Ranking Member Brown, Members of the Committee;
I would like to begin by thanking the Members of this Committee for
this opportunity to be here today, and also to thank each of you who
has given your time to sit down and meet with me. I know you keep quite
busy schedules, and I very much appreciate sharing your time, hearing
to your thoughts, and listening to your wise advice.
I want to thank the President for his nomination. I am honored to
be before you as a nominee, and humbled to be considered for the
position of the President of the Export-Import Bank.
I also want to take a moment to thank the Vice President as well;
for his time and effort and support. It was my pleasure and honor to
have worked alongside Vice President Pence for a number of years in
Congress, on a variety of issues and matters, and it is great to see
that he continues to serve his country as our Vice President. And so I
am also grateful to him for taking the time to have been as supportive
as he has been of my nomination.
And finally, and most importantly, I would like to say thank you to
my family--those that could be with me today, and those who could not
for various reasons.
As it is said, ``Children are a gift from the Lord'', and
rightfully so. I have been blessed.
I have been blessed with my two daughters. Starting with my
youngest who is here with me today. I am very proud of her and
delighted that she was able to take time out of work to be with us
today. My oldest daughter is a teacher and her husband--my new son-in-
law--who is pursuing his PhD, are not able to be here with us today. I
am very proud of them as well.
And of course my wife--it is said, ``an excellent wife, who can
find? She is more precious than jewels . . . '' and such is the person
who has been my partner now for 33 years, including through my years in
Congress, and now the many months of this nomination process . . . and
I am blessed that she has been my partner all this time, and is now
here to be with me during this hearing today.
As I have said. I am honored to be before this Committee as the
nominee to lead the Export-Import Bank, and hope to gain your support.
Let me be crystal clear on this point: If I am confirmed, the
Export-Import bank will continue to fully operate, point blank. It will
continue to approve the many loans that support our American
manufacturers' ability to export their products.
I know that many of you here fully support the Export-Import bank's
mission, and represent constituents and businesses that are directly
impacted by the availability of financing from the Bank. So, let me
again be clear, and leave no doubt in anyone's mind; that I commit to
and will carry out the President's vision regarding Ex-Im: a fully
functioning bank.
I fully support the President's pro-growth agenda. He has laid out
an agenda to create jobs and expand the American economy.
I completely agree that robust U.S. exports are critical to the
vitality of the U.S. manufacturing sector.
And furthermore, it's my belief that a robust manufacturing sector
is essential to a strong and vibrant economy.
Strong manufacturing goes hand and hand with the President's agenda
of increasing more and better jobs, for all Americans. This is a
mission that I am honored to have been selected to advance.
Furthermore, it is absolutely vital that U.S. companies have a
level playing field to compete in the world market with their foreign
competitors.
As the former Chairman of the House Financial Service Subcommittee
on Capital Markets, I have an understanding of finance and the
importance of capital markets to the creation of American manufacturing
jobs.
So, it will be my goal, should I be confirmed, to fully and
strongly advance this agenda, and to ensure that the Ex-Im bank
operates as intended by the Law, as set forth by you--Senators and
Members of the Banking Committee.
Let me repeat that--that the Ex-Im bank operates as intended by the
Law, as set forth by you--the legislators. I want to work with you to
have the Bank operate in a fair, open and transparent manner so that we
together can achieve the President's objective of creating more jobs,
good paying jobs, good American jobs. If confirmed by this body, I will
carry out this mission to the very best of my ability.
Finally, having served in Congress, I very much appreciate the
constitutional responsibilities of the legislative branch. If
confirmed, I look forward to an open and transparent dialogue with
Congress, and this Committee specifically, and with each of you.
In short, I am committed to working with you to promote the
creation of American jobs, provide the maximum value to the American
taxpayer, and ensure that Ex-Im operates fully.
It's an honor to be here today, and I look forward to taking your
questions.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
PREPARED STATEMENT OF KIMBERLY A. REED
To Be First Vice President of the Export-Import Bank
November 1, 2017
Chairman Crapo, Ranking Member Brown, and Members of the Committee,
thank you for this opportunity to appear before you today. I am honored
to be the President's nominee to serve as First Vice President of the
Export-Import Bank of the United States (Bank), a position that
includes being Vice Chairman of the Bank's Board of Directors. As a
West Virginian, I am grateful to Senators Shelley Moore Capito and Joe
Manchin for their support.
I am pleased to introduce my father Terry and sister Meghan. My
father taught me the importance of public service and helping others.
My mother, Janet Logue Reed, passed when I was nine years old, but I
know that she is with us. My brother Mark, sister Ashley, and brother-
in-law Jeremy, a Purple Heart recipient, are watching online.
My interest in public service was sparked when I was 4 years old
and my father was a counsel to the then newly founded Republican Study
Committee. This is when I first met former House Ways and Means
Chairman Bill Archer and his Chief of Staff Don Carlson. They have
supported me my whole life, and I am deeply honored to have them join
us today.
When it comes to helping others, I serve on the Alzheimer's
Association National Board of Directors. This disease impacts five
million Americans and fifteen million unpaid caregivers, and my thanks
go to you and Members of Congress, as well as advocates watching today,
who take action to end our Nation's most expensive disease.
I appreciated the opportunity to meet many of you to discuss your
hopes for the Bank. Creating good American jobs is a top priority for
the President, as I am sure it is for all of you. If confirmed, I will
deliver on this priority. We are on the cusp of an American renaissance
in manufacturing, including for small and new entry companies.
I am committed to serving our Nation, and, if confirmed, look
forward to bringing two decades of bi-partisan experience to my work at
the Bank, which has more than 400 dedicated career professionals.
Throughout my career, I have engaged not only with CEOs and world
leaders, but also with thousands of constituents and small businesses
in your States.
As Director of the Treasury Department's Community Development
Financial Institutions Fund under President George W. Bush, I made job
creation in distressed communities a key priority. I oversaw efforts to
provide $4 billion in financing--in the forms of New Markets Tax
Credits, loans, and grants--to financial institutions and economic
development groups that were investing in our Nation's rural, Native
American, and urban communities.
As Counsel to three Congressional Committees, I focused on
oversight and reform to improve our Federal agencies. I deeply
appreciate the valuable role Congress plays in oversight of Federal
programs, including the Bank, and the importance of faithfully
executing all our laws consistent with the intent of Congress.
As Senior Advisor to U.S. Treasury Secretaries John Snow and Henry
Paulson, I helped advance our Nation's economic program. I know the
value of working as part of an Administration's team and making sure
Congress and the American people are fully informed about the
President's agenda.
Most recently, as President of the International Food Information
Council Foundation, I worked with the U.S. Departments of Agriculture
and State in numerous emerging market countries around the world to
increase acceptance of U.S. exports.
The Bank has become an important source of funding for small
businesses and an avenue for job creation. Nonetheless, there are
needed reforms to ensure that taxpayer dollars are protected from waste
and fraud and that Americans are obtaining the best value.
With respect to the activities of the Bank, my friend, Chairman
Archer, taught me that any reform must not occur at the expense of our
national interests. He warned against unilateral disarmament in a
fiercely competitive global economy. I share his concerns and would
never advocate to place American exporters and workers in a worse
position than our foreign counterparts. There are now 95 foreign Export
Credit Agencies--including eleven acknowledged in the past year--many
of which are used by foreign Governments attempting to move U.S. jobs
and business revenue to their countries.
In West Virginia, my grandfather taught me the importance of having
the necessary tools in life. As an eighth grader during the Great
Depression, he launched Reed's Dairy. When private sector financing was
not available, the Federal Land Bank filled the gap, and the dairy
became one of the most successful small enterprises in the State. My
grandfather farmed for the rest of his life and was meticulous with his
toolbox. The United States must have the right tools--including a fully
functioning Export-Import Bank--in our toolbox to be successful in the
global marketplace.
But, those tools need to be constantly repaired and reformed. I am
especially interested in making sure that small- and medium-
enterprises, just the kind of businesses that I am so familiar with in
West Virginia, have full access to the programs authorized by Congress.
If confirmed, I will bring a fresh set of eyes to the Bank to
strengthen U.S. competitiveness and bring better value to the taxpayer,
as the opportunity for Americans to create and export has never been
brighter.
Thank you for your consideration. I would be pleased to answer any
questions.
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PREPARED STATEMENT OF SPENCER BACHUS III
To Be a Member of the Board of Directors of the Export-Import Bank;
Reappointment as a Member of the Board of Directors of the Export-
Import Bank
November 1, 2017
Chairman Crapo, Ranking Member Brown, and distinguished Members of
the Committee, thank you for considering my nomination to be a member
of the Board of Directors of the Export-Import Bank of the United
States. I also appreciate very much the recent opportunities we had to
discuss my nomination and your concerns.
It is an honor to be selected by President Trump. I welcome the
opportunity, if confirmed, to work for American workers and promote
U.S. business interests and exports.
Today, I am pleased to have my wife and best friend, Linda, join
me. During my entire public service, she has been by my side
encouraging me along the way and making me a better person.
There is a familiar phrase from the 1967 movie ``Cool Hand Luke''
that somewhat inarticulately says, ``What we've got here is failure to
communicate.'' I think that may sum up the current situation of the
Export-Import Bank. After being nominated to the Ex-Im Board by
President Trump in April, it didn't take me long to be reminded that
there are serious and strongly held differences between what the
supporters of Ex-Im and its detractors believe about its mission,
importance to the economy, and indeed, the need for its existence.
That is particularly disturbing since the Export-Import Bank has a
proud history including financing the Burma Road during WWII and the
Marshall Plan under President Eisenhower. Furthermore, Ex-Im has
returned a profit to the taxpayers since the Reagan Administration.
Nonetheless, its more recent lack of responsiveness to concerns
expressed by many in the Legislative branch has created a hostile and
adversarial relationship that has brought the Bank's operations to a
virtual standstill: and, this is seriously constraining the
competitiveness of U.S. manufacturers and other businesses in the
global economy.
Unfortunately the timing couldn't be worse. We are increasingly
shut out of a large portion of the world marketplace because of an
unleveled playing field. And that is extraordinarily regrettable at a
time when markets are increasingly global. When America was the world's
leading exporter, the American dream of the greatest generation was
home ownership. Today, I suggest, that dream is a good job.
The failure of the Bank to adequately communicate with Congress and
the American public has resulted in bad blood, outright hostility, and
ultimately, the fundamental loss of confidence in the institution.
Allowing this situation to continue would be a calamity, not just
for the Bank, but for our whole country and its place in the global
economy. If the failure to communicate involving Ex-Im isn't resolved,
it won't be at the expense of the fictional character Cool Hand Luke
played by Paul Newman. It will be at the expense of the jobs of
thousands of American workers, present and future, as export
opportunities both large and small are scuttled and lost. Sadly with
those lost jobs will go the dreams of a better life for many American
families.
The duties of individual Ex-Im Board members are not defined in the
Bank's charter. It has been the practice for each Board member to
determine how they can best serve the mission of the Bank to create
jobs and spur economic growth through greater support of exports. If I
am confirmed as a member of the Ex-Im Board, improving the
communication between the Bank and both Congress and the Bank's
customers, big and small, present and prospective, will be priority one
for me. I've heard legitimate concerns that Ex-Im's efforts to support
small businesses grow their workforce by increasing their exports have
fallen short. We must better reach and serve American's smaller
employers and their workers. Improving Ex-Im's small business products
to ensure small business have a first class experience will be a
critical first step toward fulfilling it's mission to level the playing
field for America's best job creators. Bringing Ex-Im's technology
platforms into the 21st Century will aid in protecting the U.S.
taxpayer against potential external fraud attempts.
During my tenure on the House Financial Services Committee, I
helped guide the passage of legislation reforming many of the Ex-Im
operational requirements. I look forward to being able to work with the
nominee for Chairman of the Bank, my former colleague and good friend
Scott Garrett, and the other Board members to restore the confidence of
Congress and others in this vital institution. A first step in that
direction will be to ensure better communications with Congress.
Please permit me to leave you with one final thought as I conclude
my remarks. As members of Congress, you and I have had the immense
pleasure and honor of meeting many American workers. What I have heard
from those workers is that, if given a chance to compete on a level
playing field, they will compete with workers anywhere else in the
world and they will produce the best product at the best price. I truly
believe that and look forward to working with you at the Export-Import
Bank to make that a reality.
If I am confirmed by the Senate, I pledge to work with you
alongside my fellow Board members to carry out and pursue the mission
of Ex-Im as written in its charter. Mr. Chairman, Ranking Member Brown,
and Members of the Committee, I truly appreciate your time today and
consideration of my nomination. I look forward to answering any
questions you may have.
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PREPARED STATEMENT OF JUDITH DELZOPPO PRYOR
To Be a Member of the Board of Directors of the Export-Import Bank
November 1, 2017
Mr. Chairman, Ranking Member Brown, Members of the Committee, I am
honored to appear before you today as a nominee for the Board of
Directors of the Export-Import Bank of the United States. I am deeply
grateful to President Trump for nominating me and to Senator Schumer
for his recommendation and support. If confirmed, I pledge to carry out
Ex-Im's mission with honor and integrity. I would also like to thank
Ranking Member Brown, Senator Heitkamp, and their staff for the trust
they have placed in me, and for their support and encouragement.
And thank you, to all the Members of the Banking Committee for your
commitment to move this process forward. I have met with many of you
and your staff to discuss your priorities related to the Bank and how
we can ensure Ex-Im continues to support American jobs by increasing
our exports of goods and services. If confirmed, I look forward to
further conversations about how we can work together to help American
businesses succeed in the international marketplace.
Last, I would like to introduce some of my family members who are
with me today. My husband David Pryor, Jr. and my brother-in-law Mark
Pryor--I married into an Arkansas family with a long history of public
service and it seems some of that has rubbed off on me. Our son Hampton
Pryor is with me today too. Every day, he reminds me to persevere, no
matter the challenges life delivers. My parents have been gone awhile
now, but today would have been Mother's 90th birthday. Happy Birthday
Mom. My brother Joseph DelZoppo and my niece Christine could not be
here today, but I am grateful for their love and support.
I am a proud product of Ohio public schools and graduated from
Bowling Green State University. My brother and I are the first
generation of our family to attend college.
From the American dream of my grandparents, who immigrated to the
United States at the turn of the last century and settled in Cleveland
to work in the factories; to the boom of the post-World War II years
that my parents enjoyed; to my youth, and the unfortunate decline of
manufacturing in the Factory Belt of the Midwest--now the Rust Belt--
the need for the Export-Import Bank of the United States is even more
relevant today.
If confirmed, my top priority will be to focus on Ex-Im's mission
of supporting American jobs and growing American exports, while
protecting taxpayer dollars. With over 95 percent of the world's
consumers living outside U.S. borders, there are so many opportunities
for American businesses to grow their customer base abroad. Indeed, I
look forward to contributing to this growth, particularly by increasing
support for small businesses, but also by ensuring that businesses of
all sizes are able to compete fairly in the global marketplace. There
are 95 other export credit agencies in the world today, getting the
Export-Import Bank of the United States fully up and running is
imperative to helping American manufacturers grow their exports.
As an accomplished professional with 25 years of international
experience in the private sector, coupled with 6\1/2\ years of
Government service at the Overseas Private Investment Corporation
(OPIC), I believe I would bring to Ex-Im Bank, a unique set of work and
life experiences.
I spent most of my career working for American businesses with an
international presence--from Asia to Africa, the Middle East, and
western Europe, whether international start-ups, Fortune 100s, or small
businesses--my private sector work has focused on the high-tech,
broadcast, telecom and satellite communications industries. With
decades of experience in corporate communications, marketing and sales,
branding, messaging, and business development, I have been a trusted
tone setter and caretaker of an organization's public reputation.
Most of my private sector work took me to many overseas locations--
mostly emerging markets that were new to me. At WorldSpace and other
companies where I worked, I was fortunate to have local staff in
country, and on whom I could rely to help navigate the activities and
undertakings required of me. I remember how daunting it seemed. A new
place, with different customs, languages, rules and regulations. This
is a reality for many U.S. small businesses wishing to export into
foreign markets. They are trying to figure out what they need to know,
and do, to get their product from Point A to Point B. I recognize how
difficult this can be.
Most recently, I was proud to serve during the Obama
administration, at the Overseas Private Investment Corporation, as Vice
President of External Affairs and as a member of OPIC's Leadership
Team. This experience ingrained in me a sense of duty to ensure
taxpayer dollars are protected and Government programs are managed with
integrity and efficiency. My department wore multiple hats, including
responsibility for the Agency's relationship with Congress, the media,
and the general public. We built and launched a more customer-friendly
interactive website, and greatly expanded engagement and information
exchange with Congress and OPIC's customers. I also held a seat on the
Investment Committee weighing in on all project commitments over $20
million, and was responsible for overseeing outreach to the U.S. small
business community. This role made me realize that we should be doing
so much more to support America's small businesses. Here and
everywhere, they are the engine of economic growth.
In fact, during my time at OPIC, my department expanded outreach
efforts to the small business community by doubling the number of
educational workshops hosted throughout the United States. To date,
these workshops have educated over 4,000 small businesses--including
minority and women-owned--about the services available to them through
OPIC and other Federal Government agencies including the U.S. Export-
Import Bank, U.S. Trade and Development Agency, and the Small Business
Administration.
Last year alone, our Export-Import Bank supported over 2,600 small
businesses, and has an 80-year track record of supporting U.S. jobs and
growing exports by helping manufacturers of all sizes. Ex-Im can help
take the fear out of exporting for smaller companies and it can ensure
a level playing field, so all American manufacturers are able to
compete fairly in the global marketplace.
If I am confirmed to the Board of Directors, I strongly believe my
experience and background, paired with the new initiatives enacted by
Congress in the 2015 Charter, will help to modernize the Bank, and keep
its mission current and relevant in today's changing times. I look
forward to working with the employees at the Bank on many items, always
with one objective in mind: to support and sustain American jobs
through exports. If confirmed, I will also remain vigilant in
protecting taxpayer dollars. To this end, I look forward to working
with my fellow board nominees, the nominee for Inspector General, and
the entirety of Ex-Im's management and staff.
Mr. Chairman, Ranking Member Brown, Members of the Committee, thank
you again for the opportunity to appear before you today as I
respectfully ask for your support to serve on the Board of Directors of
the Export-Import Bank of the United States. If confirmed, I also look
forward to working with you and the business community in your States
and throughout the country, to help raise additional awareness of Ex-
Im's financing products for small businesses and community banks.
Thank you and I am happy to answer any questions you may have.
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PREPARED STATEMENT OF CLAUDIA SLACIK
To Be a Member of the Board of Directors of the Export-Import Bank;
Reappointment as a Member of the Board of Directors of the Export-
Import Bank
November 1, 2017
Chairman Crapo, Ranking Member Brown, and distinguished Members of
this Committee, it is an honor to appear before you today. I am
grateful to be nominated by the President to be a member of the Board
of Directors of the Export-Import Bank, and if confirmed, I would be
honored to serve and do all I can in this capacity to support jobs for
my fellow citizens.
Let me start by thanking the Members of this Committee who I had
the pleasure of meeting before today's hearing. I appreciated all the
comments you had about the Bank. For those of you whom I did not yet
meet, I look forward to having similar conversations with you if
confirmed. Similarly, if confirmed, I look forward to working with all
of you and your staffs on any issues you have related to the Bank.
Before presenting my background, let me first introduce you to the
members of my family who are here today. First, my spouse Susan Davis,
who was born and raised in Louisiana and who has dedicated most of her
professional life in service to impoverished people in the neediest
parts of the world.
And second, my brother, Kurt Slacik who was born in New York State
and who is now a senior executive at a steel mill in Pennsylvania.
As for myself, I was born in upstate New York and grew up there as
well as in New Jersey, Illinois, Connecticut, California, and
Massachusetts. I also spent 5 years in Brussels, Belgium where my
father was a senior executive for a major U.S. company. I am a product
of both public and parochial schools. I received my undergraduate
degree from Smith College and my MBA from New York University. While my
parents are both deceased, I have four siblings and five smart and
beautiful nieces. My paternal grandparents immigrated to the United
States from Czechoslovakia just before the First World War and set up a
small meat packing business in upstate New York. My maternal
grandfather was a coal miner in Scranton, Pennsylvania.
I have spent the last 35 years in the U.S. financial services
industry mostly as a commercial lender to corporations and an
international trade finance specialist. I also have experience in
corporate restructurings, risk management, and general management. I
have served on the boards of several companies, both public and
private, with a specialty serving on their Audit Committees, in
addition to service on several nonprofit boards.
My most recent professional position was as the Chief Banking
Officer at the Export-Import Bank from 2013 through 2016. I learned
first hand of the importance of the Bank to American exporters and the
workers they employ. By leveling the playing field for large businesses
and assuming risk for smaller companies, Ex-Im enables American
businesses to successfully compete on the global stage where foreign
Governments do the same for their national companies. The Bank thereby
accomplishes its ultimate mission of helping our businesses grow and
supporting jobs in the United States--jobs that pay nearly 20 percent
more than other jobs of a comparable nature involving products and
services consumed here at home.
During my tenure as the Bank's Chief Banking Officer, the staff and
I analyzed billions of dollars of transactions for small, medium and
large companies which supported hundreds of thousands of jobs. My
responsibilities included expanding the public's awareness of the Bank,
and overseeing the due diligence and underwriting of all transactions
greater than $10 million before they were presented to the Board. I
also ensured that the Board, which has the ultimate authority to
approve transactions larger than $10 million, understood the structures
and risks of the transactions brought before them so they could
determine reasonable assurance of repayment. My close working
relationship with the Board also allowed me to gain a keen appreciation
for the role of the Board and the responsibilities of Board members.
I think my extensive experience as a commercial lender would serve
me well as a Board member. During those years, I acquired skills in
credit and risk analysis, as well as how the international credit
markets operate. I also obtained a keen understanding of reputation and
character risk. Needless to say, these skills are critical for members
to possess in order to keep the Bank's loan losses and default rate to
a minimum while at the same time helping businesses and workers as much
as possible.
If confirmed as a member of the Board of Directors of the Export-
Import Bank, I pledge to vigorously carry out the mission of the Bank.
I further pledge to diligently work with all Members of this Committee
to address their concerns and keep them informed of the Bank's
activities.
Mr. Chairman, Senator Brown and Members of the Committee, thank you
for your time and consideration of my nomination. I look forward to
answering any questions you may have.
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PREPARED STATEMENT OF MARK GREENBLATT
To Be Inspector General of the Export-Import Bank
November 1, 2017
Thank you, Chairman Crapo, Ranking Member Brown, and Members of the
Committee. It is an honor to appear before you as the nominee to serve
as the Inspector General (IG) of the Export-Import Bank of the United
States (Ex-Im).
At the outset, I would like to thank my family, friends, and
colleagues for their support. In particular, I would like to recognize
my parents, my late mother Marian and my father Mickey, who instilled
in me qualities like honesty, integrity, and perseverance, and whose
hard work has afforded me wonderful opportunities; my wife Jana who has
been unfailingly supportive for the past 17 years; and my two boys,
Micah and Levi, who keep me grounded and serve as rambunctious
reminders of why we are all here: to improve our country for future
generations.
I come from a long line of small-business owners--from my
grandparents, who owned a small deli in West Philadelphia, to my
father, who started three successful businesses and used our home as
collateral for a loan to keep a business afloat in tough times, to both
of my brothers, one of whom runs a manufacturing company that exports
products all around the world from a small factory right up the road in
Baltimore.
As you can see, small business is in my blood.
Unfortunately, I was the black sheep who went to law school. The
good news is that I followed in my mother's footsteps and dedicated my
career to public service. I have spent the past 14 years conducting
Government oversight, investigating waste, fraud, and abuse in
Government programs.
I started my public service here at the U.S. Senate, in the
Permanent Subcommittee on Investigations (PSI). During my PSI tenure, I
led an investigative staff through numerous complex, bipartisan
inquiries that identified waste and abuses in important programs such
as Medicare and the United Nations. For instance, I led the
Subcommittee's investigation into the United Nations' Oil-for-Food
Program, a $64 billion operation that was plagued with corruption
across the globe.
After 5\1/2\ years at Senate investigations, I joined the special
investigations unit of the Department of Justice OIG. At the DOJ OIG, I
led several investigations into sensitive matters, such as allegations
of widespread politicization and misconduct in DOJ's Voting Section and
nepotism, misuse of office, conflict of interest, and whistleblower
retaliation by senior DOJ officials.
In 2014, after more than 5 years at DOJ OIG, I moved to the
Department of Commerce OIG, where I lead the OIG's Office of
Investigations (OI) as the Assistant Inspector General for
Investigations. With the help of the highly talented OI leadership team
and staff, I spearheaded a major revitalization of the division,
restoring its integrity and professionalism and creating a culture of
ownership and success. I am pleased to report that we have achieved
considerable results in a short time, such as securing several
significant indictments and convictions that resulted in millions of
dollars in ill-gotten gains coming back to the U.S. Treasury; issuing
more than a dozen public investigative reports that identified senior-
level misconduct and tens of millions of dollars in actual or potential
waste, fraud, and abuse; establishing a robust digital analysis
program; developing a special investigations unit that focuses on
highly sensitive matters, such as allegations of ethical violations and
senior-level misconduct; and implementing a successful Whistleblower
Protection Ombudsperson program.
It is the nexus between these two threads--my experience in
Government oversight, on the one hand, and my family's background in
small business, on the other--that makes me excited at the possibility
of becoming the Ex-Im Inspector General. I appreciate Ex-Im's important
mission of supporting American jobs by facilitating the export of goods
and services. The Inspector General plays a crucial role, by providing
objective oversight to promote integrity, economy, efficiency, and
effectiveness in Ex-Im's operations. If confirmed, I would strive to be
an agent of positive change, focusing on eliminating fraud, waste, and
abuse and identifying problems and making recommendations for
corrective actions to Ex-Im's leadership.
I understand the critical role that independence plays in an
Inspector General's mission. The core principles of integrity,
objectivity, fairness, and accountability must guide an IG's judgment
and decision-making. I am fortunate to have served under the leadership
of several strong role models, including several stalwarts in the
Inspector General community, on how to run probing, objective
investigations that sought to uncover the truth and effect positive
change.
With that in mind, if I am confirmed, I intend to oversee an office
that conducts audits and evaluations in a thorough and comprehensive
manner; pursues investigations aggressively and follows the facts
wherever they may lead; issues fair and impartial reports; and makes
recommendations to improve the Bank's programs. Thankfully, all of my
interactions with the Ex-Im OIG leadership and staff indicate that they
share that vision and operate in that manner now.
I believe that an OIG can fulfill its responsibility to provide
independent oversight, while simultaneously maintaining a constructive
relationship with the agency. When I arrived at the Commerce
Department, I dedicated considerable energy to establishing and
maintaining a healthy relationship with the Department. Our oversight
is probative, insightful, and independent, which has included telling
hard truths as necessary, but it is built on a foundation of good faith
and the shared goal of improving the agency's results for the benefit
of the American taxpayer. I look forward to developing that same type
of healthy and productive relationship with Ex-Im's Board and staff.
I also appreciate the importance of maintaining strong relations
with this Committee and other Ex-Im stakeholders in Congress. In light
of my tenure conducting oversight for the Senate, the significance of
that relationship resonates with me on a personal level. With that in
mind, if confirmed, I will maintain direct and frank communications
with this Committee and other stakeholders in Congress.
In closing, I understand the challenges ahead and look forward to
the opportunity to serve the American people in this new role. I thank
the Committee for its consideration of my nomination and, if confirmed,
I will work with you to achieve our common goals.
Thank you, and I would be pleased to respond to any questions that
you might have.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM SCOTT GARRETT
Q.1. Statement 1--``I joined fellow members of the House
Freedom Caucus and other concerned lawmakers at a press
conference this morning to urge Congress to let the Export-
Import Bank expire on June 30.'' (Facebook, 5/19/2015)
With regard to Statement 1 above do you feel any regret for
calling for the Export-Import Bank to be shut down in May of
2015?
A.1. My prior comments about Ex-Im were made in the context of
some egregious instances of waste, fraud, and abuse. The Bank
has made progress on this front since I made the comments, and,
if confirmed, I look forward to ensuring that this trend
continues.
Q.2. In May of 2015, why did you believe it was necessary to
shut down the Export-Import Bank? Please offer a detailed
rationale for your thinking at that time.
A.2. As a Member of Congress, I believe in protecting Americans
and being a steward of American taxpayers' dollars funding the
Government. In May of 2015, I was under the belief that there
were significant instances of waste, fraud, and abuse at the
Bank which in my opinion would not be a good use of American
taxpayers' dollars. The Bank has made progress on this front
since I made the comments, and, if confirmed, I look forward to
ensuring that this trend continues.
Q.3. Do you regret participating in the press conference on May
19, 2015, and calling for the Export-Import Bank to be shut
down while speaking from a podium bearing the Twitter hashtag
``#EndExim''?
A.3. My prior comments about Ex-Im were made in the context of
some egregious instances of waste, fraud, and abuse. The Bank
has made progress on this front since I made the comments, and,
if confirmed, I look forward to ensuring that this trend
continues.
Q.4. Statement 2--``The proposal before us is the resurrection
of a bank that embodies the corruption of the free enterprise
system. Yes, we have the opportunity today to save capitalism
from cronyism. Yes, we have the opportunity to protect the
American taxpayer and the American Dream and to preserve free
enterprise. We have the opportunity today to keep the Export-
Import Bank out of business. We should take each of those
opportunities.'' (Floor statement, 10/27/15)
With regard to Statement 2 above, do you feel any regret
for calling for the Export-Import Bank to remain shut down in
October of 2015?
A.4. As a Member of Congress, I believe in protecting Americans
and being a steward of American taxpayers' dollars funding the
Government. In 2015, I was under the belief that there were
significant instances of waste, fraud, and abuse at the Bank
which would not be a good use of American taxpayers' dollars.
The Bank has made progress on this front since I made the
comments, and, if confirmed, I look forward to ensuring that
this trend continues.
Q.5. In October of 2015, why did you believe it was necessary
to keep the Export-Import Bank shut down? Please offer a
detailed rationale for your thinking at that time.
A.5. As a Member of Congress, I believe in protecting Americans
and being a steward of American taxpayers' dollars funding the
Government. In 2015, I was under the belief that there were
significant instances of waste, fraud, and abuse at the Bank
which would not be a good use of American taxpayers' dollars.
The Bank has made progress on this front since I made the
comments, and, if confirmed, I look forward to ensuring that
this trend continues.
Q.6. Do you believe in October of 2015 that American
manufacturers or exporters were harmed while the Export-Import
Bank was prevented from offering new credit assistance due to
the lapse in its charter? If you answer in the affirmative,
please specify which manufacturers or exporters were harmed.
A.6. The 2015 reauthorization allowed Ex-Im to implement
certain reforms required by Congress. If confirmed, I will work
with my fellow Board members and Bank staff thoroughly review
the implementation of the reforms. Further, I will work with my
fellow Board members and relevant trade agencies to ensure that
Bank's actions are consistent with the President's trade
policy.
Q.7. If you believed that American manufacturers or exporters
were harmed while the Export-Import Bank was prevented from
offering new credit assistance, why did you not acknowledge
that harm in your statement at that time?
A.7. Ex-Im is a demand driven agency. If confirmed, I will
conduct a thorough review to determine the level of demand and
any necessary changes to address such demands as they are
consistent with the President's trade policy.
Q.8. With regard to Statement 2 above, why in October of 2015
did you believe that the Export-Import Bank ``embodies the
corruption of the free enterprise system?'' Please offer a
detailed rationale for your thinking at that time.
A.8. As a Member of Congress, I believe in protecting Americans
and being a steward of American taxpayers' dollars funding the
Government. In 2015, I was under the belief that there were
significant instances of waste, fraud, and abuse at the Bank
which would not be a good use of American taxpayers' dollars.
The Bank has made progress on this front since I made the
comments, and, if confirmed, I look forward to ensuring that
this trend continues.
Q.9. Statement 3--``The Export-Import Bank transformed the role
of Government from a disinterested referee in the economy into
a biased actor that uses your taxpayer dollars to tilt the
scales in favor of its friends, and it mocks the American Dream
by making victims of the startups that dare to compete.''
(Floor statement, 10/27/15)
With regard to Statement 3 above, why in October of 2015
did you believe that the Export-Import Bank ``transforms the
role of the Government into . . . a biased actor to tilt the
scales in favor of its friends?'' Please offer a detailed
rationale for your thinking at that time.
A.9. In 2015, I made that statement in the context of some
egregious instances of waste, fraud, and abuse. Since I made
the above comments, Ex-Im has made progress on this front, and
I look forward to working with you, my fellow Board members,
and Bank staff to continue this trend.
Q.10. With regard to Statement 3 above, which ``friends'' were
you referring to? If you were referring to any corporations,
please specify those corporations.
A.10. With respect to ``friends'' in that statement, I was
referring in general to those who benefited from the instances
of waste, fraud, and abuse at Ex-Im.
Q.11. With regard to Statement 3 above, why in October of 2015
did you believe that the Export-Import Bank ``mocks the
American Dream by making victims of the startups that dare to
compete?'' Please offer a detailed rationale for your thinking
at that time, and please explain which startups you believed
were harmed by the Export-Import Bank.
A.11. In 2015, I made that statement in the context of some
egregious instances of waste, fraud, and abuse. Since I made
the above comments, Ex-Im has made progress on this front, and
I look forward to working with you, my fellow Board members,
and Bank staff to continue this trend.
Q.12. Statement 4--``the FAST Act also includes provisions to
resurrect the most shameless example of crony capitalism
Washington has ever concocted--the Export-Import Bank.''
(Statement issued by your office, 12/8/15)
With regard to Statement 4 above, please define the term
``crony capitalism'' as you used such term.
A.12. As a Member of Congress, I believe in protecting
Americans and being a steward of American taxpayers' dollars
funding the Government. In 2015, I was under the belief that
there were significant instances of waste, fraud, and abuse at
the Bank which would not be a good use of American taxpayers'
dollars.
Q.13. With regard to Statement 4 above, please offer a detailed
rationale for your thinking at that time.
A.13. The above statement was made in the context of some
egregious instances of waste, fraud, and abuse. Since I made
the above comments, Ex-Im has made progress on this front, and
I look forward to working with you, my fellow Board members,
and Bank staff to continue this trend.
Q.14. Do you now regret making any past statements regarding
the Export-Import Bank? If yes, please specify which statements
you now regret making and explain your reasoning for having
regret for such statements.
A.14. When I made the above statement, I was under the belief
that there was egregious waste, fraud, and abuse at Ex-Im. The
Bank has made progress on this front in recent years, and if
confirmed, I would work with you, my fellow Board members, and
Bank staff to continue this trend.
Q.15. Do you now retract any past statements regarding the
Export-Import Bank? If yes, please specify which statements you
now retract and explain your reasoning for retracting such
statements.
A.15. When I made the above statement, I was under the belief
that there was egregious waste, fraud, and abuse at Ex-Im. The
Bank has made progress on this front in recent years, and if
confirmed, I would work with you, my fellow Board members, and
Bank staff to continue this trend.
Q.16. Statement 5--``Other ethnicities are not that way . . .
They'll say yes to you constantly and then you'll realize they
didn't really mean it.'' (The Express Times, 11/24/2011)
Which ethnicities (or countries per your clarification)
were you referring to in statement 5?
A.16. If confirmed, I will follow the letter of the law and
treat everyone with dignity and respect.
Q.17. Does holding a prejudiced view about the how ethnicities
or persons from certain countries conduct business, as
expressed by Statement 5, indicate that you would not want to
facilitate transactions by the Export-Import Bank involving
those countries?
A.17. If confirmed, I will follow the letter of the law and
treat everyone with dignity and respect. Further, if confirmed,
I will not delay the Board from considering transactions that
have been vetted and appropriately prepared by Bank staff.
Q.18. During your nomination hearing, you stated repeatedly
that you are committed to a ``fully functioning'' Export-Import
Bank. Since making your statements in 2015 concerning the
Export-Import Bank, exactly when did you switch your position
on the Bank and desire for it to remain open?
A.18. From the time I made my statements in 2015 to April 2017
when the President nominated me to be the President of Ex-Im,
the Bank has made significant progress to improve waste, fraud,
and abuse. If confirmed, I will serve at the pleasure of the
President. I will carry out the Administration's policy to have
Ex-Im be fully operational as intended by the 2015
reauthorization.
Q.19. Statement 6--``If the question is what has changed since
2015, what we have seen changed is a new Administration, what
we have since changed is a new agenda by this Administration to
see to it that the economy actually grows and that businesses
are given a fair chance to grow their businesses both
nationally and internationally as well, so that is a
significant change since 2015.'' (Nomination hearing, 11/1/17)
During my questioning, you offered the explanation above
for your shift in position on the Export-Import Bank. Does this
mean that you believe that the Ex-Im Bank is now a net creator
of U.S. jobs?
A.19. I support the President's agenda to pursue trade policies
to create American jobs and to promote U.S. businesses. If
confirmed, I would use my role to ensure the Bank's actions are
consistent with the President's trade policies.
Q.20. Why were you unwilling to support job creation by the
Export-Import Bank under a Democratic Administration but you
now support the Bank under the current Administration?
A.20. I support the President's agenda to pursue trade policies
to create American jobs and to promote U.S. businesses. If
confirmed, I would use my role to ensure the Bank's actions are
consistent with the President's trade policies.
Q.21. Doesn't the explanation for your shift in position on the
Export-Import Bank (statement above) indicate that your
opposition to the Bank in 2015 was motivated by partisan
politics?
A.21. I support the President's agenda to pursue trade policies
to create American jobs and to promote U.S. businesses. If
confirmed, I would use my role to ensure the Bank's actions are
consistent with the President's trade policies.
Q.22. Statement 7--``some of those changes were also asked back
in 2012, and they were not effectuated''. (Nomination hearing,
Sen. Rounds questions period, 11/1/17)
What changes in either the 2012 or 2015 reauthorizations of
the Export-Import Bank do you believe have not been
effectuated? Please cite changes other than those changes that
are awaiting final action by the Board of the Bank because of
the present lack of quorum.
A.22. I believe that changes in both the 2012 and 2015
reauthorizations have been implemented except for those that
are awaiting for Board approval.
Q.23. Do you disagree with any interpretation by the Export-
Import Bank of changes to its charter contained within the 2012
or 2015 reauthorization laws? If so, please cite the specific
interpretations that you disagree with.
A.23. I have not done a thorough review of the implementation
of the 2012 and 2015 reauthorizations. If confirmed, I would
like to have a detailed briefing by staff of the Bank for
myself as well as my fellow Board members.
Q.24. You cite changes made by the 2015 reauthorization as part
of the rationale for your newfound support of the Bank.
If that is the case, why did you oppose the
reauthorization?
A.24. In 2015, my position on the Bank was based on some
egregious instances of waste, fraud, and abuse. Since then, the
Bank has made progress, and I look forward to ensuring that the
trend continues.
Q.25. Do you believe that fair-value accounting practices would
significantly limit the amount of credit assistance that the
Export-Import Bank could provide?
A.25. Fair-value accounting is a method used currently by the
Congressional Budget Office (CBO). CBO's assessments of
valuation are a matter of public record. If confirmed, I would
follow the letter of the law.
Q.26. Do you believe that that the Export-Import Bank would be
``fully functional'' if fair-value accounting practices were
instituted and the Bank's ability to provide credit assistance
was reduced as a result?
A.26. As I stated at my nomination hearing, I am committed to
carry out the President's agenda and to have Ex-Im be fully
operational as intended in the Bank's last reauthorization.
Q.27. You previously voted in favor of an amendment to the
Export-Import Bank charter to implement fair-value accounting.
Do you regret your vote (Schweikert amendment, Roll Call
Vote #615, 11/4/15) to implement fair-value accounting at the
Export-Import Bank, yes or no?
A.27. Fair-value accounting is a method used currently by the
Congressional Budget Office (CBO). CBO's assessments of
valuation are a matter of public record. If confirmed, I would
follow the letter of the law.
Q.28. If you were still a member of Congress today, would you
vote to support the implementation of fair-value accounting at
the Export-Import Bank?
A.28. I am no longer a Member of Congress. If confirmed, I will
carry out the President's agenda to pursue trade policies that
would create American jobs and improve global competitiveness
for U.S. businesses. Further, if confirmed, I would follow the
letter of the law.
Q.29. If confirmed, do you commit to not developing or
implementing fair-value accounting practices at the Export-
Import Bank unless directed to by Congress?
A.29. Fair-value accounting is a method used currently by the
Congressional Budget Office (CBO). CBO's assessments of
valuation are a matter of public record. If confirmed, I would
follow the letter of the law.
Q.30. Critics of the Export-Import Bank continue to make false
allegations of systemic fraud within the Bank.
Are you aware that since the Export-Import Bank's Office of
Inspector General was established 10 years ago, there has been
only one documented case of fraud related to the Bank's credit
assistance that involved a Bank employee?
A.30. I am now aware that in the last 10 years, there has been
only one documented case of internal fraud involving an
employee of the Bank.
Q.31. Will you publicly defend the Export-Import Bank against
false or misleading charges of fraud?
A.31. If confirmed, I will work with staff at the Bank and my
fellow Board members, as necessary, to gather facts and details
about any charges of fraud to determine its veracity or
falsity. If the facts reveal the charges to be false or
misleading, I, if confirmed, will work with my fellow Board
member to ensure that honest and accurate rebuttals are being
appropriately communicated.
Q.32. Do agree that the Export-Import Bank's extremely low
default rate, 0.303 percent when last reported this year, is
evidence that the Bank is carefully monitoring credit risk and
external fraud risks? If you do not agree for any reason,
please offer a detailed explanation.
A.32. A default rate of 0.303 percent signifies the Bank is
carefully monitoring its credit risk and external fraud risks.
Q.33. Are you aware that the aerospace industry's positive
trade balance of $90.5 billion last year was the largest trade
surplus of any manufacturing industry in the U.S.?
A.33. I appreciate your letting me know of the aerospace
industry's trade balance of $90.5 billion last year was the
largest trade surplus of any manufacturing industry in the U.S.
Q.34. Do you agree that resuming the provision of credit
assistance by the Export-Import Bank to commercial aircraft, at
levels previously supported by the Bank (pre-FY2015, as
measured by value of exports supported), is essential for the
competitiveness of American aerospace manufacturers and their
domestic suppliers?
A.34. If confirmed, I would work with my fellow Board members
and staff at the Bank to review every transaction individually,
including those transactions for aircraft financing.
Q.35. Have you previously believed that the Export-Import
Bank's support for commercial aircraft exports are an example
of cronyism?
A.35. If confirmed, I would work with my fellow Board members
and staff at the Bank to review every transaction individually,
including those transactions for aircraft financing.
Q.36. Do you presently believe that the Export-Import Bank's
support for commercial aircraft exports are an example of
cronyism? If your answer is different than your answer to the
previous question, please state when your view shifted.
A.36. If confirmed, I would work with my fellow Board members
and staff at the Bank to review every transaction individually,
including those transactions for aircraft financing. If
confirmed, I would work with staff at the Bank to pursue a
rigorous review of Bank operations to ensure that it provides
maximum value to the American Taxpayers.
Q.37. If confirmed, would you work to alter or change any
policies or procedures of the Bank with regard to the analysis
or processing of transactions, including economic impact
analysis regarding aircraft transactions? If you answer in the
affirmative to the preceding question, please cite which
policies or procedures you would work to alter or change.
A.37. If confirmed, I would work with my fellow Board members
to consider any proposed change in policies or procedures of
the Bank with regard to the analysis or processing of
transactions, including economic impact analysis regarding
aircraft transactions.
Q.38. Do you believe that the Export-Import Bank needs to begin
quickly processing the $30 billion pipeline of deals that need
board approval but cannot be considered because of the present
lack of board quorum?
A.38. If confirmed, I would work with my fellow Board member
and staff at the Bank to properly review transactions pursuant
to the Charter.
Q.39. Do you believe that American exporters and manufacturers
have been harmed while the Export-Import Bank is unable to
support transactions larger than $10 million?
A.39. If confirmed, I would work with my fellow Board members
and relevant trade agencies to improve global competitiveness
for U.S. businesses, increase U.S. manufacturing, and promote
American jobs.
Q.40. Do your past statements calling for the Export-Import
Bank to be shut down compromise your ability to support
reauthorization of the Bank in 2019?
A.40. My prior statements about Ex-Im were made in the context
of egregious waste, fraud, and abuse. The Bank has since made
progress and I look forward to ensuring that the trend
continues. If confirmed, I would work with you, my fellow Board
members, stakeholders, and staff at the Bank to support
reauthorization of the Bank in 2019.
Q.41. If confirmed, would you support the Export-Import Bank's
current climate policy and would you take any actions to alter
it?
A.41. If confirmed, I would support the President's agenda to
make America prosperous with the highest standard of
environmental protection.
Q.42. If confirmed, would you work to ensure that the comment
process for environmental and social impacts from projects is
properly structured and adequately resourced to ensure that
comments from concerned parties are meaningfully considered?
A.42. If confirmed, I would work to ensure that the comment
process for environmental and social impacts from projects is
appropriately structured to ensure that comments from concerned
parties are meaningfully considered.
Q.43. If confirmed, do you commit to providing all documents
and materials that the Office of Inspector General requests?
A.43. Yes, if confirmed, I commit to providing all documents
and materials that the Office of Inspector General requests in
accordance with the law and regulations.
Q.44. You once agreed with a constituent during a public forum
that President Obama should show his birth certificate.
Can you cite another instance where you publicly stated
that an elected official in the U.S. that should be required to
show their birth certificate, or did you only state that
publicly with regard to President Obama?
A.44. If confirmed, I will follow the letter of the law and
treat everyone with dignity and respect. My personal views on
social issues have no impact on my ability to lead the Bank and
create jobs.
Q.45. You previously made discriminatory comments regarding
LGBT candidates for public office.
Do you believe that your views would disqualify you as the
CEO at major U.S. corporations?
A.45. My personal views on social issues have no impact on my
ability to lead the Bank or serve as a CEO of a major U.S.
corporation. If confirmed, I will follow the letter of the law
and treat everyone with dignity and respect.
Q.46. As a nominee for an executive role, do you believe in the
need to eliminate discrimination, including discrimination
based on sexual orientation, within the workplace?
A.46. My personal views on social issues have no impact on my
ability to lead the Bank or serve as a CEO of a major U.S.
corporation. If confirmed, I will follow the letter of the law
and treat everyone with dignity and respect.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR ROUNDS
FROM SCOTT GARRETT
Q.1. Mr. Garrett, while you were serving in the House of
Representatives, you said on multiple occasions that you did
not think that the Export-Import Bank should continue to exist.
For example, during debate on the 2015 reauthorization of Ex-
Im, you said the following on the House floor:
In June of this year, after 81 years of doling out
taxpayer-funded welfare for mega-corporations, the
American people said enough, and Congress let the
Export-Import Bank expire.
Yet, today, through a little known and little used
legislative maneuver being used to circumvent the will
of the American people, they are resurrecting this fund
for corporate welfare.
The Export-Import Bank transformed the role of
Government from a disinterested referee in the economy
into a biased actor that uses your taxpayer dollars to
tilt the scales in favor of its friends, and it mocks
the American Dream by making victims of the startups
that dare to compete.
If we promoted responsible Government policies,
responsible budget policies, expanded free markets,
lowered and simplified the income taxes, and repealed
onerous regulations, American businesses would thrive
in the global markets. But none of that is on the table
today on what we are about to consider.
Instead, the proposal before us is the resurrection of
a bank that embodies the corruption of the free
enterprise system. Yes, we have the opportunity today
to save capitalism from cronyism. Yes, we have the
opportunity to protect the American taxpayer and the
American Dream and to preserve free enterprise. We have
the opportunity today to keep the Export-Import Bank
out of business. We should take each of those
opportunities.
In addition, when you were speaking at an anti-Ex-Im press
conference in 2015, you said,
It's hard to imagine anything more unfair and un-
American than having the Government financially support
mega-corporations at the expense of small businesses
and American workers. But that is exactly what has been
happening, and it will continue to happen if we don't
let the Export-Import Bank expire next month. It
rewards those with close relationships with Washington
bureaucrats and makes victims of startups that dare to
compete against them--literally picking winners and
losers in our economy.
Ex-Im has transformed the role of Government from a
disinterested referee that guarantees a free and open
marketplace into a biased actor that tilts the scales
in favor of its friends in businesses. We have the
opportunity to save capitalism from cronyism and to
fulfill a promise to the American people to work for
them instead of a select few with special connections
in Washington. For the sake of the American taxpayer
and the preservation of the free enterprise system,
Congress should put the Export-Import Bank out of
business.
What made you change your mind about whether or not Ex-Im
should exist?
A.1. I appreciate the questions raised about the juxtaposition
of my current and prior positions on Ex-Im. Since the Bank's
last reauthorization in 2015, we have a new Administration led
by President Trump that is committed to growing American
manufacturing jobs and enhancing transparency, efficiency, and
predictability throughout the Federal Government. President
Trump's leadership and commitment to good governance instilled
in me the confidence to accept the President's offer to lead
Ex-Im, help create American manufacturing jobs, and ensure the
Bank fully implements reforms mandated by Congress.
My role in public policy has changed since the Bank's
reauthorization in 2015. I was previously a Member of the House
of Representatives with the responsibility to utilize
communications and legislative tactics intended to promote good
Government. I am now the President's nominee with the
opportunity to lead a Federal agency that, if properly
administered, can inspire the confidence of all members of the
Senate and House of Representatives.
I would also like to take this opportunity to clarify a
question you posed in one of our office visits regarding the
proposals that may come before the Board. You may be interested
to know that a provision added to the Board's charter in the
2006 reauthorization states: ``At the request of any two
members of the Board of Directors, the Chairman of the Board
shall place an item pertaining to the policies or procedures of
the Bank on the agenda for discussion by the Board. Within 30
days after the date such a request is made, the Chairman shall
hold a meeting of the Board at which the item shall be
discussed.''
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR MENENDEZ FROM SCOTT GARRETT
Q.1. A major goal of the President's trade agenda is to reduce
our country's trade deficit. At a time when our economic
competitors are aggressively using their export credit agencies
to sell goods abroad, the Ex-Im Bank is an indispensable tool
that helps level the playing field for American exporters. Do
you believe that the Ex-Im Bank is an effective tool for
increasing U.S. exports thereby reducing our trade deficit?
A.1. If confirmed, I will work with my fellow Board members and
relevant trade agencies to ensure that the Bank's actions are
consistent with the President's trade policy. I strongly
support the President's agenda to pursue trade policies that
improve global competitiveness for U.S. businesses and create
American jobs.
Q.2. Some critics of the Ex-Im Bank argue that the fact that
over 80 other countries maintain export credit agencies should
not keep us from shuttering the Ex-Im Bank. But if Congress
were to close the Ex-Im Bank today, what options would the U.S.
have to convince countries like China, Brazil, and Russia to
refrain from using export credits to undercut U.S.
manufacturers?
A.2. If confirmed, I will work with you, others from relevant
trade agencies and the President to pursue trade policies that
would allow U.S. manufacturers to be globally competitive and
promote American jobs.
Q.3. In 2015, you voted against reauthorization of the Ex-Im
Bank. However, in your testimony and during your hearing, you
repeatedly stated that if you are confirmed, the Bank will
continue to fully operate. If confirmed, will you commit to
supporting in 2019 a clean reauthorization or one that is
substantially similar to the 2015 reauthorization?
A.3. If confirmed, I look forward to working closely with
Congress on the reauthorization of the Bank in 2019. I will
consult with each Member of this Committee on any reforms that
may be required to ensure the Bank to reach its full potential.
Q.4. In 2015, you pushed for the exclusion of openly LGBTQ
candidates by refusing to support the National Republican
Congressional Committee because it ``actively recruited gay
candidates and supported homosexuals in primaries.'' While you
were in Congress, you voted against hate crimes protections for
LGBTQ people, you voted against the repeal of the ``Don't Ask,
Don't Tell'' policy, and you voted two times in favor a
constitutional amendment to ban same-sex marriage. What
assurances can you provide to all Ex-Im employees, and
particularly LGBTQ employees, that they will be treated with
fairness and dignity and afforded all of the rights due to them
under the law?
A.4. If confirmed, I will follow the letter of the law and
treat all employees with dignity and respect. My personal views
on social issues have no impact on my ability to lead the Bank
and help create American jobs.
Q.5. During a tour of New Jersey businesses in 2011, regarding
businesses selling products abroad, you said, ``other
ethnicities are not that way [straightforward] . . . they'll
say yes to you constantly and then you'll realize they really
didn't mean it.'' \1\
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Which ``ethnicities'' will say yes and not mean it?
Do you believe that some ``ethnicities'' are less
straightforward or honest than others?
A.5. If confirmed, I will follow the letter of the law and
treat all people of different ethnicities and background with
dignity and respect. My personal views on social issues have no
impact on my ability to lead the Bank and help create American
jobs.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM SCOTT GARRETT
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. I understand and share your concerns for Ex-Im to have a
robust structure to protect its sensitive financial
information. I am not familiar with the specific details of the
IT system at Ex-Im. If confirmed, I would make it a priority to
learn more about the IT system at Ex-Im and work with my fellow
Board members and Bank staff to put in place a strong system to
protect against cybersecurity threats.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. It is conceivable that someone may view the lack of
certainty in Ex-Im's may have an impact on American businesses.
If confirmed, I will serve at the pleasure of the President and
will do all I can to carry out the Administration's policy to
have Ex-Im be fully operational as intended by the law. I look
forward to working closely with both the House and Senate on
the reauthorization of the Bank in 2019.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. If confirmed, I would look forward to working with my
fellow Board members, Bank staff, and stakeholders on new ideas
and projects to conduct outreach, including the use of
technology, to businesses in all rural areas of the United
States.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes, pursuant to the law, a quorum of the Board is
required to approve some of the positions established during
the reauthorization of 2015. If confirmed, I would work with my
fellow Board members to prioritize the approval of these
positions.
Q.5. Mr. Garrett, you have been critical of the Ex-Im Bank and
the role it serves, even going as far as calling it ``corporate
welfare'' and a symbol of Washington's ``crony capitalism.''
You have called for Ex-Im to be shut down repeatedly and voted
against its reauthorization multiple times during your tenure
in Congress. It is important to note here that Ex-Im operates
at zero cost to the taxpayer--in fact, Ex-Im sends $1 billion
to the U.S. Treasury per year. Do you regret undertaking your
crusade against Ex-Im during your time as a Congressman?
A.5. My prior comments about Ex-Im were made in the context of
some egregious instances of waste, fraud, and abuse. The Bank
has made progress on this front since I made the comments, and,
if confirmed, I look forward to ensuring that this trend
continues.
Q.6. Could you explain your opposition to American businesses
who utilize Ex-Im when they have no other financing options?
Should these businesses have thrown in the towel and allowed
Chinese companies that receive many types of subsidies to take
their business?
A.6. I strongly support the President's agenda to pursue trade
policies that create American jobs and promote a globally
competitive playing field for U.S. businesses. If confirmed, I
would work with you, the relevant trade agencies, and
stakeholders to ensure the Bank's actions are consistent with
the President's trade policy.
Q.7. Following a 5-month lapse in authority, Ex-Im's charter
was renewed on December 4, 2015, but the Bank operated for the
entire fiscal year without a quorum. This meant Ex-Im could not
approve transactions worth more than $10 million, significantly
handicapping the Bank. In FY2014, the most recent year in which
Ex-Im operated with a quorum, the Bank supported $27.5 billion
in exports and 165,000 jobs. In FY2016, the Bank only supported
$8 billion in exports and 52,000 jobs. In Virginia, Ex-Im aided
more than 41 exporters for a total of $415 million in exports
in FY2014--with 51 percent of these exporters being small
businesses. Ex-Im aided only 33 exporters for a total of $172
million in exports in FY2016--70 percent of which were small
businesses.
Was your campaign against Ex-Im worth 100,000 American
jobs?
How do you explain your actions to the thousands of hard-
working Americans who were out of work because of the lack of a
quorum?
Would you continue to make decisions as President of Ex-Im
that would result in fewer Americans working?
A.7. My prior statements about Ex-Im were made in the context
of some egregious instances of waste, fraud, and abuses. The
Bank has made progress on this front in recent years and I look
forward to ensuring that the trend continues. If confirmed, I
would work with my fellow Board members to not delay
considering transactions that have been vetted by Bank staff.
Q.8. In your career as a lawyer and lawmaker, have you ever
played a role advising on the types of transactions supported
by Ex-Im? Please explain in detail how your background makes
you qualified for a role on Ex-Im's Board.
A.8. My experience as a Member of Congress has allowed me to
conduct oversight reviews and collect testimonies from
agencies, industries and concerned citizens, and consider
legislation on all issues under the jurisdiction of the House
Financial Services and Budget Committees which include the
Export-Import Bank.
Q.9. As a Member of Congress, you told your own party that you
would no longer donate money to a party fund that had supported
gay candidates for Congress. What assurances can you provide
the Committee that you won't similarly discriminate against
companies seeking Ex-Im support?
A.9. My personal views on social issues have no impact on my
ability to lead the Bank, create American jobs, and promote
U.S. businesses. If confirmed, I will follow the letter of the
law and treat everyone with dignity and respect.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR HEITKAMP
FROM SCOTT GARRETT
Q.1. The 2015 Reauthorization included a provision to negotiate
with other OECD countries to eliminate export credit worldwide.
How do you interpret the role of the Chairman relative to
that position?
A.1. If confirmed, I will work with my fellow Board members and
others from the relevant trade agencies to ensure the Bank's
actions are consistent with the President's trade policy.
Q.2. If other countries are unwilling to eliminate or reduce
export credit, do you think it is prudent for the USG to
unilaterally disarm?
A.2. If confirmed, I will support and carry out the President's
agenda to pursue trade policies that create American Jobs and
are fair to the American worker. If confirmed, I will work
closely with you and the relevant trade agencies to ensure the
Bank's actions are consistent with the President's trade
policy.
Q.3. How do you consider the companies in the supply chain that
produce items that go into larger products, many of which are
small businesses?
A.3. If confirmed, I would support the President's agenda to
pursue trade policies that create American jobs and promote
U.S. businesses of all sizes and industries.
Q.4. Do you see the economic value that the Bank provides to
them as ``invisible exporters''?
A.4. If confirmed, I would support the President's agenda to
pursue trade policies that create American jobs and promote
U.S. businesses of all sizes. My prior statements and positions
on the Bank were in the context of egregious instances of
waste, fraud, and abuse. The Bank has made progress since my
statements and I look forward to ensuring the trend continues.
Q.5. You cited the reforms and the new Administration as a
justification for the apparent epiphany that you've had on the
Export-Import Bank. However, you VOTED AGAINST all of those
reforms in 2015, just as you voted against the reforms in 2012.
Why do you now think they--along with the Bank as a whole--
are now OK?
A.5. I strongly support the President's agenda to pursue trade
policies that improve global competitiveness for U.S.
businesses and create American jobs. If confirmed, I will work
with my fellow Board members and relevant trade agencies to
ensure the Bank's actions are consistent with the President's
trade policy.
Q.6. You said you wanted the Bank to be ``fully functional''.
How do you define that?
A.6. I think the Bank is fully functional if it acts in
accordance with the law, its Board maintains at least a quorum,
it is reauthorized by Congress, and it receives its
appropriations as allocated under the President's budget.
Q.7. Will you deny any transaction that the staff recommends
from coming to the Board for a vote?
A.7. If confirmed, I will work with my fellow Board members to
consider transactions that have been vetted and appropriately
prepared by Bank staff.
Q.8. Also, what specific reforms--outside of the ones Congress
already mandated--would you implement?
A.8. If confirmed and after my review of the status of how the
Bank is operating, I would be pleased to work with you, my
fellow Board members and staff at the Bank to recommend
reforms, if any are warranted.
Q.9. What is your vision and timeline for those changes?
A.9. Having not been confirmed and not spent sufficient time
reviewing the Bank and its operation, it would be unwise and
premature for me to suggest any timeline for unspecified
reforms.
------
RESPONSES TO WRITTEN QUESTIONS OF
SENATOR CORTEZ MASTO FROM SCOTT GARRETT
Q.1. Do you believe that the Export-Import Bank supports
American jobs and helps U.S. small businesses?
A.1. Yes, I believe the mission of the Export-Import Bank
pursuant to its charter is to support American jobs and U.S.
businesses.
Q.2. Do you regret your actions taken in 2015 to shut-down the
Export-Import Bank? If you had it to do over again, would you
take the same actions?
A.2. My vote as a Member of Congress is a matter of public
record. My vote in 2015 was dependent on the information I had
in 2015.
Q.3. Please cite examples, if any, of actions taken during your
career as an elected official to support the equality and
dignity of LGBTQ people.
A.3. Having served as a Member of Congress, my vote record is a
matter of public record. If confirmed, I will follow the letter
of the law and treat everyone with dignity and respect.
Q.4. If confirmed to lead the Export-Import Bank, what steps
will you take to ensure that the 500 or so employees of the
Bank are ensured a workplace free from discrimination on the
basis of protected characteristics, including sexual
orientation and gender identity?
A.4. If confirmed, I will follow the letter of the law and
treat all employees with dignity and respect. My personal views
on social issues have no impact on my ability to lead the Bank
and create jobs.
Q.5. In 2015, you openly stated that you were withholding
contributions from the NRCC because of their support for openly
gay candidates. Can you commit that the sexual orientation and
gender identity of individuals seeking help from the Export-
Import Bank will not be a factor on any of the Bank's
decisions?
A.5. My personal views on social issues have no impact on my
ability to lead the Bank and to help create more jobs for
Americans. If confirmed, I will follow the letter of the law
and treat all employees with dignity and respect.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM KIMBERLY A. REED
Q.1. Do you believe that the Export-Import Bank needs to begin
quickly processing the $30 billion pipeline of transactions
that need board approval but cannot be considered because of
the present lack of board quorum?
A.1. Yes, if confirmed and following orientation and Office of
Inspector General briefings that will inform me on Export-
Import Bank of the United States (Bank) internal procedures and
critical immediate needs, I will support a process to fairly,
fully, and expeditiously consider the pipeline of transactions
brought before the Board of Directors. As part of this process
and with my every action at the Bank, I will adhere to the Bank
Charter and Bylaws, as well as all other applicable laws and
regulations.
Q.2. Do you believe that American exporters and manufacturers
have been harmed while the Export-Import Bank is unable to
support transactions larger than $10 million? Please offer you
views on the economic benefits to American exporters and
manufacturers from addressing the transaction backlog.
A.2. Yes, the Bank plays an important role in contributing to
the employment of United States workers and expanding United
States economic growth. I am informed on American exporter and
manufacturer challenges due to the Bank's lack of a quorum and
resulting inability to support transactions larger than $10
million. For example, the Bankers Association for Finance and
Trade noted the following in their November 1, 2017, Statement
for the Record: ``Without access to a U.S. ECA, U.S. companies
have lost out on the opportunity to bid on at least $67 billion
in foreign infrastructure projects over the past year--with
hundreds of billions of dollars in projects on the horizon.
These sales do not just impact the manufacturers directly, but
the countless supply chain companies of all sizes that provide
inputs and services to them.'' Once there is a Board quorum and
the reported $30 billion transaction backlog is resolved, the
Bank will be supporting American exporters, manufacturers, and
workers and fulfilling the President's priority of creating
good American jobs. It is vital that the United States be
competitive on the global stage.
Q.3. Do you believe that any changes contained in the 2012 or
2015 reauthorizations of the Export-Import Bank have not been
properly implemented? Please cite any changes you believe have
not been properly implemented, excluding any changes that are
awaiting final action by the Board of the Bank because of the
present lack of quorum.
A.3. No, I am not aware of any 2012 or 2015 reauthorization
changes that have not been properly implemented, excluding
changes that require a quorum. If confirmed, I will request an
internal Export-Import Bank briefing on the status of the 2012
and 2015 reauthorization implementations to ensure the Bank is
fulfilling its Charter. I also will work with Congress on any
issues of concern.
Q.4. Will you publicly defend the Export-Import Bank against
false or misleading charges of fraud?
A.4. Once a final determination is made by the Office of
Inspector General and/or other appropriate expert, I, if
confirmed, will work with my Board colleagues to ensure that
the Bank properly responds to any false or misleading charge of
fraud. As part of this process, I will work with the Chief
Ethics Officer and other Bank officials to ensure that all
statements, including those that I make to publicly defend the
Bank, are appropriate and follow communication best practices.
Q.5. Do you agree that the Export-Import Bank's extremely low
default rate, 0.303 percent when last reported this year, is
evidence that the Bank is carefully monitoring credit risk and
external fraud risks? If you do not agree for any reason,
please offer a detailed explanation.
A.5. Yes, the Bank has an extremely low default rate, which is
indicative of good transaction approval practices. However, it
also depends upon the quality of the portfolio. While I do not
yet have information to comment on the Bank's internal
processes, if confirmed, I look forward to approving a
qualified Chief Risk Officer and working with them and the
Board to ensure the Bank is following the best risk management
and mitigation practices.
Q.6. Do you agree that resuming the provision of credit
assistance by the Export-Import Bank to commercial aircraft, at
levels previously supported by the Bank (pre-FY2015, as
measured by value of exports supported), is essential for the
competitiveness of American aerospace manufacturers and their
domestic suppliers?
A.6. Yes, it is important to support credit assistance for U.S.
commercial aircraft and their suppliers. The amount should be
determined by the financing need and/or whether the global
marketplace playing field needs to be leveled. I, if confirmed,
will review each transaction independently, on the merits, and
in accordance with the Bank's Charter. Ultimately, my goal
would be to support United States jobs through exports.
Q.7. If confirmed, are there any specific policies or
procedures of the Export-Import Bank that you would work to
alter or change?
A.7. No. I currently have no specific alterations or changes
that I, if confirmed, would undertake at the Bank. As part of
Board best practices, I would have internal and external
discussions with staff, the Office of Inspector General,
stakeholders, customers, potential customers, experts, and
Congress, among others, to inform my opinion on the
effectiveness, efficiency, and transparency of specific
policies or producers.
Q.8. If confirmed, would you work to ensure that the comment
process for environmental and social impacts from projects is
properly structured and adequately resourced to ensure that
comments from concerned parties are meaningfully considered?
A.8. Yes, I, if confirmed, will work with my fellow Board
Members and Bank staff to ensure that the environmental and
social impact comment process is properly structured and
adequately resourced to ensure comments are meaningfully
considered.
Q.9. If confirmed, do you commit to providing all documents and
materials that the Office of Inspector General requests?
A.9. Yes, I will commit to providing all documents and
materials requested by the Office of Inspector General in
accordance with Federal laws and regulations. I value the
independent role that Inspectors General play at the Bank and
in our Government.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM KIMBERLY A. REED
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. Government cybersecurity, in general, needs bolstering and
additional work across the board. Although I currently do not
have internal Bank knowledge, I, if confirmed, will request
staff and Office of Inspector General briefings on the Bank's
protections of sensitive financial information and take action
as needed. I am committed to robust cybersecurity, good
enterprise risk management practices, and other protections.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. Yes, numerous stakeholders and customers say that American
businesses and workers are hurt because of the Bank's
uncertainty, including through the lack of a long-term
reauthorization and fully functioning Board of Directors. There
are now 95 foreign Export Credit Agencies--including 11
acknowledged in the past year many of which are used by foreign
Governments attempting to move U.S. jobs and business revenue
to their countries. Without a long-term reauthorization, U.S.
jobs and business revenue may move to other countries that
offer more aggressive, predictable, efficient, reliable,
flexible and competitive Export Credit Agency products and
programs.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. As I testified on November 1, 2017, ``I am especially
interested in making sure that small- and medium-enterprises,
just the kind of businesses that I am so familiar with in West
Virginia, have full access to the programs authorized by
Congress.'' I, if confirmed, will and encourage Bank staff to
work with all stakeholders--Congressional offices, community
banks and credit unions, local Chambers of Commerce, trade,
manufacturing, business, and agriculture organizations, local
government agencies, women and minority-owned business
organizations, the media, academia, and others--to proactively
share the Bank's mission and products with rural small
businesses. Through this outreach, the Bank should identify
unmet needs and gaps where the Bank could make the difference
for American workers and exports. The Bank should set up a
rigorous and effective measurement process to track both impact
and return on investment, including new small business
applicants and the creation of U.S. jobs.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes, a Board quorum is required to approve the positions
of Chief Ethics Officer and Chief Risk Officer, both of which
were created as part of the 2015 reauthorization and are
important positions to help to combat waste, fraud, and abuse.
If confirmed, I look forward to promptly approving qualified
Chief Ethics and Risk Officers and faithfully executing all our
laws consistent with the intent of Congress.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM SPENCER BACHUS III
Q.1. Do you believe that the Export-Import Bank needs to begin
quickly processing the $30 billion pipeline of transactions
that need board approval but cannot be considered because of
the present lack of board quorum?
A.1. Yes, I understand that these transactions are aging and
that they are being lost to other countries's exporters because
Ex-Im is not fully operational and cannot approve large
transactions without a quorum. I believe the lack of Board
quorum has hurt the U.S. economy because the exporters are
driven offshore to seek financing support for their businesses.
As a result, the big loss to the United States will be American
jobs. So if confirmed, I would work with my fellow Board
members and Bank staff to review all transactions brought
before the Board in a timely manner and consistent with the
requirements set forth in Ex-Im's charter.
Q.2. Do you believe that American exporters and manufacturers
have been harmed while the Export-Import Bank is unable to
support transactions larger than $10 million? Please offer you
views on the economic benefits to American exporters and
manufacturers from addressing the transaction backlog.
A.2. Yes, there is plenty of evidence to show the U.S.
companies have lost opportunities to pursue billions of dollars
because they were not able to rely on Ex-Im to finance the
contracts. It is my view that American exporters and
manufacturers will enjoy the economic benefits in the form of
more business and more jobs when these backlogged transactions
are addressed.
Q.3. Do you believe that any changes contained in the 2012 or
2015 reauthorizations of the Export-Import Bank have not been
properly implemented? Please cite any changes you believe have
not been properly implemented, excluding any changes that are
awaiting final action by the Board of the Bank because of the
present lack of quorum.
A.3. I am not aware of any reforms contained in the 2012 and
2015 reauthorizations that have not been properly implemented.
I am aware of a few changes in the last reauthorizations which
require a Board quorum in order to be fully implemented. They
are:
1. Approve ethics officer
2. Approve risk officer
3. Terminating audit committee
4. Approve medium term program
5. Approve guidelines for staff to approve small business
loans
6. Appoint members to sub-Saharan advisory committee
Q.4. Will you publicly defend the Export-Import Bank against
false or misleading charges of fraud?
A.4. Yes, if confirmed, I will work with Bank staff and my
fellow Board members to review charges of fraud and to respond
appropriately.
Q.5. Do you agree that the Export-Import Bank's extremely low
default rate, 0.303 percent when last reported this year, is
evidence that the Bank is carefully monitoring credit risk and
external fraud risks? If you do not agree for any reason,
please offer a detailed explanation.
A.5. Yes. I would also like to point out that no commercial
banks could do business with such a low level rate of risk.
Q.6. Do you agree that resuming the provision of credit
assistance by the Export-Import Bank to commercial aircraft, at
levels previously supported by the Bank (pre-FY2015, as
measured by value of exports supported), is essential for the
competitiveness of American aerospace manufacturers and their
domestic suppliers?
A.6. Yes, I believe that resuming the credit assistance by Ex-
Im to the American aerospace manufacturers is critical to the
leveling of the playing field for U.S. Companies. Of about $140
to 150 billion annual market share, the American manufacturers,
with the support of Ex-Im financing, can win a huge portion of
the market share. If confirmed, I will work with my fellow
Board members to review all transactions pursuant to the
charter. I am in full support of promoting American
manufacturers to grow the economy and to create American jobs.
Q.7. If confirmed, are there any specific policies or
procedures of the Export-Import Bank that you would work to
alter or change?
A.7. If confirmed, I would like to work with you and my fellow
Board members to review Ex-Im current policies and to suggest
any changes to allow the Bank to be competitive with other
ECAs.
Q.8. If confirmed, would you work to ensure that the comment
process for environmental and social impacts from projects is
properly structured and adequately resourced to ensure that
comments from concerned parties are meaningfully considered?
A.8. Yes, if confirmed, I would work with my fellow Board
members and Bank staffs to ensure that the environmental and
social impacts comment process is properly structured and
adequately resourced to ensure comments are meaningfully
considered.
Q.9. If confirmed, do you commit to providing all documents and
materials that the Office of Inspector General requests?
A.9. Yes, if confirmed, I would work with Bank staff to provide
documents and materials to the Office of Inspector General in
accordance with the law and regulations.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM SPENCER BACHUS III
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. Thank you Senator for a very good question. If confirmed,
I will commit to looking into this issue and gather more
details from the staff at the Bank.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. Yes, I believe that the lack of a long-term
reauthorization hurts American businesses because of the
uncertainty in Ex-Im's longevity. The lack of a long-term
reauthorization has caused companies to move U.S. jobs
overseas. If Congress continues to send the message to
customers that U.S. Ex-Im is unreliable, they are more likely
to turn to other ECAs for financing and not rely on Ex-Im Bank.
I strongly believe this will impact negatively on U.S. jobs and
exports. I believe a longer reauthorization removes the
uncertainty and underscores the U.S. Government's commitment to
American exporters.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. I believe that Ex-Im needs to make a greater effort to
educate small business exporters everywhere about the products
offered by the Bank and encourage a collaborative and
cooperative relationship with Regional and community Banks. If
confirmed, I would work with my fellow Board members, Bank
staff and stakeholders to improve outreach efforts to the small
businesses in rural America.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes, a Board quorum is required to approve the positions
of Chief Ethics Officer and Chief Risk Officer which were
created in the 2015 reauthorization.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM JUDITH DELZOPPO PRYOR
Q.1. Do you believe that the Export-Import Bank needs to begin
quickly processing the $30 billion pipeline of transactions
that need board approval but cannot be considered because of
the present lack of board quorum?
A.1. Yes, I believe it is critical that the Board quickly move
to begin processing the transactions that have been in its
pipeline for as long as 2 years now. If confirmed, I will
thoroughly review all transactions brought before the Board in
a timely fashion to ensure they are consistent with
requirements set forth in Ex-Im's Charter.
Q.2. Do you believe that American exporters and manufacturers
have been harmed while the Export-Import Bank is unable to
support transactions larger than $10 million? Please offer you
views on the economic benefits to American exporters and
manufacturers from addressing the transaction backlog.
A.2. Yes, I believe that American exporters and manufacturers
have been put at a competitive disadvantage in markets around
the world due to the inability of Ex-Im to fill the financing
gap and level the playing field. Today, Ex-Im has a pipeline of
transactions worth more than $30 billion that are waiting for
Board consideration. The delay in considering these
transactions can mean sales--and the American jobs they
support--lost to foreign competitors. With foreign export
credit agencies providing around $230 billion in medium- and
long-term financing last year alone, there may be many more
cases where a U.S. exporter lost sales opportunities because
Ex-Im was not fully functional.
When Ex-Im is able to support U.S. exporters, I believe
they can reach new markets and boost their sales. Those
increased sales directly support well-paying, quality American
jobs.
Q.3. Do you believe that any changes contained in the 2012 or
2015 reauthorizations of the Export-Import Bank have not been
properly implemented? Please cite any changes you believe have
not been properly implemented, excluding any changes that are
awaiting final action by the Board of the Bank because of the
present lack of quorum.
A.3. I understand there are a number of changes that require a
Board quorum in order for them to be finalized, including
approval of a Chief Risk Officer and a Chief Ethics Officer, as
well as changes to help Ex-Im more quickly process certain
transactions that typically support small- and medium-sized
businesses. I also believe there are a number of changes from
the 2012 or 2015 reauthorizations that have been properly
implemented, including increasing the Bank's loan loss reserves
and accepting electronic payments and documents for all its
transactions. If confirmed, I will work with the team at Ex-Im
and my fellow Board members to learn more about the changes
required in the 2012 and 2015 reauthorizations required by
Congress and ensure Ex-Im is or quickly complies with its
statutory requirements.
Q.4. Will you publicly defend the Export-Import Bank against
false or misleading charges of fraud?
A.4. If confirmed, I will seek to do so.
I will also learn more about the Bank's record and how it
responds to potential cases of fraud. If there are false or
misleading charges about the Bank's record, I would seek to
work with my fellow Board Members, the Bank's legal team, and
also the Office of the Inspector General to ensure that honest
and accurate rebuttals are being appropriately communicated.
Q.5. Do you agree that the Export-Import Bank's extremely low
default rate, 0.303 percent when last reported this year, is
evidence that the Bank is carefully monitoring credit risk and
external fraud risks? If you do not agree for any reason,
please offer a detailed explanation.
A.5. Yes, I agree. Since 2008, the Bank has generated money for
the U. S. Treasury to support deficit reduction. If confirmed,
I will remain vigilant to ensure the Export-Import Bank
maintains a low default rate.
Q.6. Do you agree that resuming the provision of credit
assistance by the Export-Import Bank to commercial aircraft, at
levels previously supported by the Bank (pre-FY2015, as
measured by value of exports supported), is essential for the
competitiveness of American aerospace manufacturers and their
domestic suppliers?
A.6. Yes, I do believe it is essential, and the Charter is
clear that financing cannot be denied based on industry or
sector. If confirmed, I would review each Board-level
transaction individually to ensure it is consistent with all
statutory requirements, including a reasonable assurance of
repayment and support of U.S. jobs. While there are many
factors that affect the competitiveness of American aerospace
manufacturers, I believe that Ex-Im's credit assistance plays a
crucial role in supporting fair competition so U.S.
manufacturers are competing on quality and price--not financing
on the basis of officially supported export credit.
Additionally, the small businesses that contribute to this
industry represent hundreds of thousands of jobs supported
throughout the supply chain. If confirmed, I will work with the
Chair and the Vice Chair to see if we can find a way to collect
and report this data.
Q.7. If confirmed, are there any specific policies or
procedures of the Export-Import Bank that you would work to
alter or change?
A.7. If confirmed, there are no specific policies or procedures
that I intend to modify, except perhaps to determine a way to
collect data on the small businesses that feed into larger
transactions as stated above. I will work with the Chair and
Vice Chair to determine if there is an effective way to do
this. If confirmed, I am willing to consider changes that
support the effectiveness and efficiency of the Bank and that
are consistent with its mission as set forth by Congress.
Q.8. If confirmed, would you work to ensure that the comment
process for environmental and social impacts from projects is
properly structured and adequately resourced to ensure that
comments from concerned parties are meaningfully considered?
A.8. Yes. These considerations are important for every project
and I will take these environmental and social impact issues
seriously.
Q.9. If confirmed, do you commit to providing all documents and
materials that the Office of Inspector General requests?
A.9. Yes, I will provide all requested documents and materials
permitted by law.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM JUDITH DELZOPPO PRYOR
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. I understand the concern, especially in the wake of recent
news. I am not familiar, at this point, with the specifics of
Ex-Im's IT systems and protection. I understand that the agency
processes a significant amount of financial information
annually and, if confirmed, I would make it a priority to learn
more about the protections the Bank has in place and how we can
protect against potential cybersecurity threats.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. Yes, I do believe a long-term reauthorization provides
assurance to the American business community that Ex-Im will be
here to support them throughout the process. My understanding
is that many applications considered by the Bank require
months--sometimes years--ofreview and due diligence. Without
knowing if the Bank will be fully operational in the future,
companies may be unwilling to start the process of applying for
Ex-Im financing right now. Should I be confirmed, one of my
priorities will be working with my fellow Board members to
communicate to the business community our commitment to a fully
functioning Bank. I will also work with the Members of the
Banking Committee and the rest of Congress on the prospects for
a long-term reauthorization for the Export-Import Bank, prior
to the end of fiscal year 2019, when its current authorization
expires.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. I believe it is important not only for small businesses
across the country, but especially in rural communities, to
know about the tools Ex-Im offers. While Ex-Im already conducts
outreach, we can never do enough to help our small business
community. Expanding outreach to community banks and credit
unions, who have the relationships with their local businesses
can be important force multipliers. I also believe Ex-Im can do
more to work with the local business community to help build
awareness. During my time at the Overseas Private Investment
Corporation, I was proud that we doubled the number of small
business workshops hosted around the country to educate small
businesses, including women- and minority-owned about the
services available to them from Agencies such as OPIC, SBA,
USTDA and Ex-Im. I will draw from that experience in my efforts
to support the Bank's outreach to small businesses.
Advancements in technology are also moving rapidly and the
Bank must keep pace in order to be responsive to customer needs
and expectations. Technology provides Ex-Im with tools to
conduct outreach to more small businesses, especially those in
rural areas. If confirmed, I look forward to learning more
about the Bank's data systems and how Ex-Im can leverage new
technologies to expand outreach in an effective, efficient
manner.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes. The 2015 reauthorization established a Chief Ethics
Officer and a Chief Risk Officer, positions that play a role in
combating fraud, waste, and abuse. While the Bank has officials
in these positions, formal approval of those appointments
requires Board action. If confirmed, I would work with my
fellow Board Members to prioritize the approval of officials to
these roles.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM CLAUDIA SLACIK
Q.1. Do you believe that the Export-Import Bank needs to begin
quickly processing the $30 billion pipeline of transactions
that need board approval but cannot be considered because of
the present lack of board quorum?
A.1. Yes. If confirmed, I would work with my fellow Board
Members to begin carefully reviewing--in expedited fashion--the
many transactions in the pipeline that would support thousands
of U.S. jobs. I would review each of these transactions for
reasonable assurance of repayment, and thereby ensure Ex-Im is
keeping American exporters competitive in the global economy.
Q.2. Do you believe that American exporters and manufacturers
have been harmed while the Export-Import Bank is unable to
support transactions larger than $10 million? Please offer you
views on the economic benefits to American exporters and
manufacturers from addressing the transaction backlog.
A.2. Yes. As a result of Ex-Im's inability to fully operate,
sales have gone overseas resulting in less work for Americans
and less revenue for the U.S. Treasury. One example is that as
a result of the lack of quorum on Ex-Im's Board of Directors,
U.K. Export Finance (UKEF) has cut deals to finance Boeing jets
that will be outfitted with Rolls Royce engines made in the
U.K. rather than GE engines built in Ohio. When Ex-Im is fully
operational, it directly helps U.S. manufacturers compete
overseas and supports many more jobs throughout their domestic
supply chains.
Q.3. Do you believe that any changes contained in the 2012 or
2015 reauthorizations of the Export-Import Bank have not been
properly implemented? Please cite any changes you believe have
not been properly implemented, excluding any changes that are
awaiting final action by the Board of the Bank because of the
present lack of quorum.
A.3. No. To the best of my knowledge, all changes have been
properly implemented. I draw this conclusion from my time at
the Bank, where we worked to implement certain requirements
from the 2012 reauthorization, as well as the transparent
progress link that the Bank makes available on its website.
Q.4. Will you publicly defend the Export-Import Bank against
false or misleading charges of fraud?
A.4. Absolutely.
Q.5. Do you agree that the Export-Import Bank's extremely low
default rate, 0.303 percent when last reported this year, is
evidence that the Bank is carefully monitoring credit risk and
external fraud risks? If you do not agree for any reason,
please offer a detailed explanation.
A.5. Absolutely.
Q.6. Do you agree that resuming the provision of credit
assistance by the Export-Import Bank to commercial aircraft, at
levels previously supported by the Bank (pre-FY2015, as
measured by value of exports supported), is essential for the
competitiveness of American aerospace manufacturers and their
domestic suppliers?
A.6. I believe that we must fully support ALL American
exporters, regardless of sector, to ensure that they are fully
competitive in the global economy. Because Ex-Im is demand
driven, I cannot commit to financing at any specific level, but
I will commit that if Ex-Im financing is necessary in order to
fill a private sector liquidity void or to level the playing
field due to financing offered by other export credit agencies,
I will support the financing as long as there is a reasonable
assurance of repayment so as to protect the taxpayers.
Q.7. If confirmed, are there any specific policies or
procedures of the Export-Import Bank that you would work to
alter or change?
A.7. If confirmed, I would like to see a more robust Medium-
Term Program and a significant increase in the amount of small
business that is sourced on larger transactions and applied as
direct exports. More programs to directly support small
businesses are also needed.
Q.8. If confirmed, would you work to ensure that the comment
process for environmental and social impacts from projects is
properly structured and adequately resourced to ensure that
comments from concerned parties are meaningfully considered?
A.8. Absolutely.
Q.9. If confirmed, do you commit to providing all documents and
materials that the Office of Inspector General requests?
A.9. Yes, to the extent permitted by law. It is imperative that
the Bank has a good working relationship with the IG and that
any documents dealing with waste, fraud, and abuse be provided
to them on a timely basis.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM CLAUDIA SLACIK
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. I understand the concern and I believe them to be quite
robust. I understand that all employees are required to do
cyber security training each year. When I was Chief Banking
Officer (CBO), the Chief Information Officer provided weekly
updates to the senior staff about the latest cyberattack
attempts. If confirmed, I would encourage the Bank staff to
continuously improve upon cybersecurity.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. Absolutely. As I traveled around as CBO, and met with
foreign customers, they constantly raised the uncertainty of
Ex-Im's continued existence as a deterrent to sourcing from the
U.S. In addition, other export credit agencies used uncertainty
around Ex-Im as a tool for them to recruit business into
sourcing from their countries rather than from the U.S. A long-
term reauthorization would go a long way towards addressing
this problem.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. Small businesses around the U.S., and especially those in
rural communities, need to know about Ex-Im products that can
help companies export with confidence. I think enhancements can
be made to Ex-Im's existing efforts to conduct outreach to
businesses, including expanding the Bank's partnerships with
local business groups and other ``boots on the ground'' who are
familiar with the businesses in their communities. These
entities can be important amplifiers of Ex-Im tools.
It is also important to make sure Ex-Im is keeping pace
with the twenty-first century economy, including the tools
technology provides to enhance outreach and ease of
communicating. I believe it is important for Ex-Im to keep pace
with changing technologies in order to meet customer needs and
expectations. Technology can also make it easier to reach
businesses, including those in rural areas. Should I be
confirmed, I plan to learn more about the opportunities
technology provides to expand outreach in an efficient and
effective manner.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes. The 2015 reauthorization created several new
positions at Ex-Im, including the Chief Ethics Officer and the
Chief Risk Officer. I believe both of those positions play
important roles in efforts to combat waste, fraud, and abuse. I
understand that the Bank has officials in those positions.
However, I also understand that the 2015 reauthorization
required those appointments to be formally approved by the Ex-
Im Bank Board of Directors. Should I be confirmed to the Board,
one of my top priorities would be to approve the appointments
of those officials to those roles.
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RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN
FROM MARK L. GREENBLATT
Q.1. My office and other Members of the Banking Committee have
benefited greatly from the prompt response of the Office of
Inspector General (OIG) to information requests and
correspondence. If confirmed, do you commit to continuing a
high level of responsiveness to Congressional requests?
A.1. Yes, I believe that developing and maintaining a
constructive relationship with Congress is integral to the
success of any OIG. I recognize that OIGs have a direct
reporting relationship with Congress and, if confirmed, I would
make such relationships a priority. With that in mind, I commit
to maintaining strong lines of communication with Congress (as
permitted by governing law and law enforcement processes),
which includes not only continuing a high level of
responsiveness to Congressional requests, but also proactively
engaging with Members and staff.
Q.2. Do you believe it is important for OIG to distinguish in
reporting of its investigative work concerning the Bank's
credit assistance between cases of Ex-Im employees that are
complicit in fraud and cases related to external persons or
entities that are complicit in fraud?
A.2. I believe it is important for an OIG to be precise in its
reporting on all of its work, including how it characterizes
individuals implicated in investigative matters. I understand
that the current reporting structure in the Ex-Im OIG's
Semiannual Reports to Congress lists Employee Integrity matters
(comprising all employee cases, including those involving
credit assistance) as a separate category from the other
categories of fraud (generally committed by external persons).
I further understand that the distinction between credit
assistance investigations involving internal and external
individuals (i.e., employees of the Bank versus third-parties)
is sensitive and, if confirmed, I would be willing to explore
additional options for reporting such information.
Q.3. In your testimony, you raised important points about the
mandated obligations of the OIG and their effect on the
office's ability to conduct other oversight and investigative
work. If confirmed, will you continue to update my office on
the resource needs and capabilities of the OIG as you complete
further analysis of the office's workload.
A.3. Yes, if confirmed, I will further analyze the OIG's
workload and update your office on the OIG's resource needs and
capabilities. To amplify on my statements at the hearing, I
understand from current OIG leadership that 80 to 90 percent of
the OIG's Office of Audit's work every year focuses on mandated
projects that have little to do with the Bank's lending
operations or maintenance of the Bank's existing loan
portfolio.
For instance, the OIG is required by statute to issue
products on the following topics on an annual or biennial
basis:
the Bank's financial statements,
the Bank's compliance with the Federal Information
Security Modernization Act (FISMA),
the Bank's compliance with the improper payments
laws,
the Bank's compliance with the DATA Act, and
a Risk Assessment of the Bank's Purchase Card
Program.
Notably, this list is not exhaustive and does not include
other mandatory one-time requirements or Congressional
requests.
According to current OIG leadership, all of the required
products limit the OIG's ability to conduct discretionary
assignments that would examine the core of the Bank's
international lending operations and maintenance of its loan
portfolio, which could grow to as high as $135 billion. This
limitation could be especially problematic, considering that
the confirmation of a quorum of the Bank's Board of Directors
is expected to lead to the consideration of roughly $30 billion
in new transactions. As I understand it, without additional
resources, the OIG would be limited in its ability to oversee
such new transactions or changes in Bank processes or
practices.
Q.4. Are there other topics of priority for OIG on which you
wish to elaborate that you were not able to address in written
or oral testimony?
A.4. One priority is eliminating barriers to the OIG's access
to information and records. I understand that, in the past 2
years alone, the OIG has publicly reported three cases in which
it has encountered difficulty in obtaining timely access to
information and records. For instance, in its Semiannual Report
to Congress dated March 31, 2017, the OIG reported that the
Bank failed to produce a legal analysis that was directly
relevant to an ongoing evaluation with significant
Congressional interest. According to the OIG's report, the Bank
produced the document only after the exit conference for the
evaluation, which was approximately 8 months after the OIG had
requested the materials. The report stated further that this
resulted in a 1-month delay of the issuance of the evaluation.
Similarly, the OIG noted in an audit dated September 29,
2017, that the Bank was unable to produce validated data in a
timely manner. According to that report, it took more than 4
months for the Bank to produce the requested data and, as a
result, the OIG's sample for that audit was selected from
unvalidated data.
Obtaining timely and complete access to information is
integral to the OIG's ability to perform its responsibilities,
and therefore, if I am confirmed, I will work with the Bank to
eliminate any barriers and delays to the OIG's access to
information and records. Moreover, if confirmed, I will keep
this Committee apprised in the event that access problems
continue.
------
RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARNER
FROM MARK L. GREENBLATT
Q.1. Cybersecurity: In light of the major cybersecurity
breaches, most recently at Equifax, that have affected hundreds
of millions of consumers in the United States, how robust are
Ex-Im's protections of sensitive financial information?
A.1. I am not an employee of the Bank and, therefore, I am not
privy to all of the relevant information concerning the
effectiveness of Ex-Im's protections of sensitive financial
information. That said, I understand that the OIG issued an
audit examining the effectiveness of Ex-Im's information
security program for fiscal year 2016. That audit report stated
that, although Ex-Im addressed several of the challenges
identified during previous FISMA audits, its information
security program and practices are not effective overall when
assessed against revised Department of Homeland Security
reporting metrics. The report stated further that Ex-Im has not
effectively implemented a mature information security program
and contained nine new recommendations and two partially re-
issued recommendations for corrective action from prior years.
I recognize that cybersecurity and the protection of sensitive
financial information is an important issue and, if confirmed,
I would expect to continue exploring these issues in the
future.
Q.2. Long-Term Reauthorization: Does the lack of a long-term
reauthorization hurt American businesses because of the lack of
certainty in Ex-Im's longevity?
A.2. As I noted above, I am not an employee of the Bank and,
therefore, I am not privy to all of the relevant information
concerning whether the lack of a long-term reauthorization hurt
American businesses because of the lack of certainty in Ex-Im's
longevity. I understand, however, that the Ex-Im OIG has
expressed concerns in the past about the uncertainty facing the
Bank in general and the impact it has had. For instance, the
OIG reported in its most recent Semiannual Report to Congress
that uncertainty about the future of Ex-Im, along with managing
the effects of the lapse in authorization and the lapse in
Board quorum, is the top management challenge facing the Bank.
Q.3. Rural/Manufacturing: What else can Ex-Im be doing to make
sure that small businesses in rural Virginia, places like
Marion in Southwest Virginia and Emporia in Southside Virginia,
learn about and take advantage of Ex-Im?
A.3. I understand that the OIG recently announced that it is
initiating an evaluation of Ex-Im's small business strategy and
related policies and procedures. My understanding is that the
objective is to assess the effectiveness of Ex-Im's small
business policies, procedures, and marketing strategy,
including the use of brokers to meet the 25 percent requirement
in Ex-Im's charter. This evaluation should address the
strategies impacting small businesses across the United States.
If confirmed, I would expect to continue these efforts and
update you on the OIG's findings and recommendations for
corrective action, if any.
Q.4. Fraud, Waste, and Abuse: Does the Board require a quorum
to approve some of the positions that were established to
combat fraud, waste, and abuse that were part of the last
reauthorization in 2015?
A.4. Yes, I understand that the 2015 reauthorization requires
that the Board must have a quorum to approve the positions of
the Chief Risk Officer and Chief Ethics Officer and to commence
a fully operational Risk Management Committee.
Additional Material Supplied for the Record
LETTERS IN OPPOSITION TO THE NOMINATION OF SCOTT GARRETT
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
LETTER IN SUPPORT OF THE NOMINATION OF KIMBERLY A. REED
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
THE BIGGEST BENEFICIARIES OF THE EX-IM BANK
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
EXPORT-IMPORT BANK: PROPAGANDA VERSUS THE FACTS
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
BOEING HELPED CRAFT OWN LOAN RULE; CELEBRATING OUR INDEPENDENCE--FROM
THE EXPORT-IMPORT BANK
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
KEY ARGUMENT FOR EXPORT-IMPORT BANK INVALID
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]