It's Big Business vs. the Tea Party again. Just weeks after the two fought over the nomination of South Carolina Senator Thad Cochran in a runoff before the November election, they're fighting over the future of the Export-Import Bank.
This little known government agency offers low-cost loans to foreign buyers of U.S. exports. So it's no surprise that U.S. Chamber of Commerce along with National Association of Manufacturers, Boeing (BA), GE (GE) and the White House want Congress to reauthorize the bank. They argue that the bank not only helps U.S. companies compete with foreign rivals, which often receive financing assistance from their own governments, but also earned $1.06 billion for the U.S. treasury last year.
Opposing them are the Tea Party and its allies (including new Republican Majority Leader Kevin McCarthy) who argue that the bank disrupts the free market and benefits primarily the biggest and richest U.S. companies.
"It seems like it's a proxy battle for the Tea Party and small government people emboldened somewhat by the defeat of Eric Cantor," says Rick Newman, senior columnist at Yahoo Finance, referring to the defeat of former House Majority Leader Eric Cantor (R-Va.) in the Republican primary. "They've just sort of picked this off as a target."
In response, says Newman, the powerful big business lobby is "now mustering its resources" and "the Import-Export bank will survive." But he notes that the latest battle shows that "the Tea Party is still out there and active. "
So can we expect more such battles to come?
Yes, says Newman. "There's a small but very passionate small government group out there...[And} Washington doesn't have enough money to fund everything...That will increase pressure on anything that looks like a giveaway."
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