 I'm Dan Rundy. I hold the Shrier Chair here at CSIS. Let me provide a little context for the discussion. I'm going to speak a little longer than I generally would when I moderate an event to set the stage. We're here at a time when the U.S. Congress is debating reauthorization of the Ex-Im Bank, the Export-Import Bank of the United States. If Congress does not reauthorize Ex-Im Bank, it will close down on July 1. In a perfect world, Ex-Im Bank would not exist. Traditionally, the Ex-Im Bank has been a vehicle to sell American-made products to countries with limited or no access to capital. The Ex-Im Bank can lend at a risk premium benchmark to commercial rates in ways that some banks can't in certain risky circumstances, and as a result, significant percentages of industrial products around the world are financed using export credit agencies, such as the Ex-Im Bank. The Ex-Im Bank does not essentially take any money from the U.S. Congress. It gets permission to lend up to a certain amount and actually sends hundreds of millions of dollars back in essentially profits each year to the U.S. Treasury. In its 80-year history, Ex-Im Bank has been used to finance the building of the Pan-American Highway, had a role in rebuilding Europe after World War II, and helped restart relations with the former Soviet Union after the Cold War. I want to highlight three reasons that proponents use in favor of authorization. The first is the hundreds of thousands of jobs directly linked to Ex-Im Bank financing. The second, there are 60 export credit agencies around the world, including in China and all of our OECD partners and competitors. We should not be in the business as one of the arguments that we should unilaterally disarm our export credit agency, the Ex-Im Bank. There's a concept in nuclear weapons, a policy called Nuclear Zero, which seeks to zero out all nuclear weapons. And I don't see Nuclear Zero for export credit agencies any time in the next 20 years. The other reason, the third reason, is that Ex-Im Bank serves as fuel injection for U.S. engagement with developing countries in Africa, Asia and Latin America who are seeking to participate in globalization. However, if someone wanted to close a government agency, this is one that has a number of features that makes it vulnerable to critiques and attack. Let me mention two that I think are particularly trenchant. First, there is the charge of crony capitalism. More than 70 percent of the lending portfolio and dollar value come from 10 companies. Let's face it, the optics of this are awkward. Many candidates for president have openly opposed the Ex-Im Bank. Candidate Obama in 2008 called Ex-Im Bank crony capitalism indicating his opposition to the Ex-Im Bank. I'll let the representative from Ex-Im Bank explain the change of heart. Many leading GOP candidates for 2016, including Jeb Bush, have come out against the Ex-Im Bank. It's ironic as Governor Bush ran a company that once used Ex-Im Bank financing. One possible presidential candidate who is an exception, I think not the only exception, is Lindsey Graham who recently said there is no way in hell I will let Ex-Im Bank expire in typical Lindsey Graham fashion. Second is the charge that also I think is vulnerable for the Ex-Im Bank is the issue of transparency. Ex-Im Bank has recently removed data about what loans it accepts and rejects. I think this is a problem and feeds into suspicions about the bank. Ex-Im Bank should fix this. Among supporters, there are two significant changes that are often mentioned in terms of changes that they'd like to see. And I think legislation that's in front of the U.S. Congress tries to deal with some of these. The first is the issue is the percentage of U.S. content. In a world of global supply chains, it is becoming more difficult to piece together manufactured goods that are largely made in the U.S. and therefore Ex-Im ought to lower the content percentages to qualify for Ex-Im loans. The response to this critique is that Ex-Im uses content as a proxy for U.S. jobs. That leads me to the other charge which I think is at the center of the reauthorization debate on the Hill. And that is the use of Ex-Im credits for coal-related industries. About 18 months ago, the Democratic majority of the Ex-Im bank voted 3 to 0 to place regulations that effectively stopped financing for coal-related industries. The Congress has signaled twice that it would like to end these job-killing rules. Most of the authorization fixes in bills in Congress seek to more permanently fix and push back on this policy. If Ex-Im Bank's focus is U.S. jobs, then imposing these job-killing regulations on coal does not make any sense. Democratic Senator Joe Manchin recently said that coal will be a part of Ex-Im Bank's future. So I think as you listen to this conversation, you understand that this is one of the elephants in the room. Enough from me. Congressman Dold, who's with us, we're very fortunate to have him, is a Republican from Illinois and is one of the 60 cosponsors of a Republican bill to reauthorize Ex-Im. So without any further ado from me, you have his biography in front of you, please welcome Congressman Dold. Well, thank you. I certainly appreciate you taking the time to come today and to talk about Ex-Im Bank, and I was delighted to be able to accept the invitation from Chairman Hochberg and the Ex-Im Bank. And Dan, thank you so much for your leadership on this. Obviously there's a lot of interest about Ex-Im Bank up on Capitol Hill, and its charters are set to expire on June 30. And let me just tell you from my perspective, we've got a government program here that helps create jobs and brings $1.2 billion into the Federal Treasury. That to me is fantastic. That's exactly the type of program that I think is what we're looking for, very much pro-growth. In the 112th Congress, I actually was one, I sat as the Vice Chair of the International Monetary Policy and Trade Committee and helped lead the reauthorization of the Ex-Im Bank. It was certainly a top priority of mine. And again, you've heard some of the arguments as to why reauthorize. I co-sponsored the Export-Import Bank reauthorization back then. Again, the common sense bipartisan piece of legislation, one that back then passed the House 330 to 93. So that wasn't some bygone era. That was just a few short years ago. The arguments for the Ex-Im Bank have not changed. In fact, I believe that there is a majority of the House Republicans that did support, obviously, the Ex-Im Bank reauthorization over 60 percent, and the Senate passed it 78 to 20. So that just kind of puts up some historical framework and reference around what happened before. As we look going forward, we're looking to, obviously, have a five-year reauthorization. And again, my clear message to each and every one of you is that the support in Congress is there and it is bipartisan. But that doesn't mean that we can take reauthorization lightly or we can take it for granted. We all have to work hard to make the case because the critics of the bank are very determined and they've been very organized. So in this Congress, obviously, Congressman Fincher has a bill in certainly one that I have co-sponsored. It's called H.R. 579 that reforms and expands the Export-Import Bank. And so as a sponsor of this legislation, I, for one, want to just take a step back and talk a little bit about why I think this is a good idea. Why is Export-Import Bank important? Why is it necessary? Many of the critics say, you know, it's only 1.6 percent, represents 1.6 percent of the exports in the United States. Well, as a small business owner, someone that understands meeting a budget and a payroll and trying to make sure that we're hiring more people. I think it's absolutely vital that we're trying to give the tools necessary for some of these small businesses to be able to expand their business and to be able to get their products out to 95 percent of the world's consumers who happen to be outside of the United States. The other thing to look at, from my perspective, I come from a district where the third largest manufacturing district in the nation, 54,000 jobs in the 10th district of Illinois rely upon exports. The Export-Import Bank isn't the end-all be-all, but I can tell you that 86 percent of the loans that it makes in Illinois go to small businesses. That's an important statistic. Some of the critics of the Export-Import Bank have still yet to be able to answer me this. If we're interested in trying to create jobs, if we're interested in trying to grow our economy, how does getting rid of the Export-Import Bank increase job growth, expand our economy? And if the answer is it doesn't, then we ought to be looking again at how do we make sure that this gets reauthorized. Not that it doesn't get reauthorized without some reforms, because some reforms I think are certainly going to be necessary. Dan told you that there's currently 60 members that are on this bill that Stephen Fincher is the lead sponsor of and certainly I am with them. But again, we need to try to expand that. We need to expand it, and that's why it's important. As we look at economic growth, I continue to be committed to advancing policies that advance economic growth. In Illinois, there's 244 businesses that rely upon the Export-Import Bank. And let me just share a story of someone that came in and sat down in my office just the other day. He came in and he said, he said, Bob, I run a business. It's actually right down the road in Baltimore. And you know what, I'm producing tractors, and they're a million dollars apiece. And you know what, the bank, my local community bank, doesn't want to finance that. I need the Export-Import Bank. I need the Export-Import Bank because we're going to ship these tractors overseas. And you know what, if it doesn't get reauthorized, I happen to have a plant over in France. And these jobs that are here in Baltimore are going to France. That's just the reality. And so again, we have a very simple decision to make. Do we choose to step up and reauthorize a mechanism that really only impacts a very small fraction of our exports, 1.6 percent? But it's a critical 1.6 percent. It actually provides that financing that oftentimes is a little bit more complicated. And it's not that the private sector necessarily is going to rush in because oftentimes these are transactions that some of these local banks or these mid-size financial institutions don't want to take on that risk. The Export-Import Bank partners very well with a lot of the financial institutions out there. And I think you'll hear later on the panel it's about 98 percent of the loans that the Export-Import Bank makes is actually partnering up with outside private financial institutions. The fact that the United States stands behind the Export-Import Bank is critical. You hear about not wanting to unilaterally disarm ourselves because we want to be globally competitive. I think it's absolutely critical today that we're talking about being globally competitive. How are we preparing ourselves? We hear it not only from an educational perspective, but we need to make sure that our businesses are able to compete and win. And that means trying to level the playing field. And right now we know that our foreign competitors have their export financing arms that are expanding, not contracting. And so I do believe that it's actually imperative for us that we make sure that this gets reauthorized. You heard the story that every time a Boeing plane lands over 19,000 small businesses land with that plane. That's the kind of story that we need to tell. We need your help up on Capitol Hill. We need your help to tell the stories of the small businesses that Export-Import Bank impacts, the jobs that Export-Import Bank helps create. And so if Export-Import Bank goes away, who wins? I would argue that the small businesses that rely upon that financing certainly don't win. I would argue that the employees, the workers at those businesses certainly don't win. But our competitors abroad, I believe, would win. So I believe this is a bipartisan policy solution. And again, I do believe that we've got to work together. This is a pro-growth, pro-jobs policy. And again, I go back to where we started at the beginning. Find me a government program that creates jobs and brings $1.2 billion into our federal treasury. There's not many of them. This is one that actually does those things. This is one that we need to make sure that we are stepping up behind and we need your help to make sure that you tell this story to members of Congress. I am pleased to say that I know that the United States Senate is working on its own reauthorization. My hope is that that bipartisan piece of legislation will be at least introduced in the next day or two. That's a huge step forward as well. But this is one of those things that as we look at how do we grow our economy, how do we make sure that there are more jobs out there. The Export-Import Bank is part of the solution. It's not part of the problem. And so there is going to be obviously some political finagling going on and people that will argue both sides of this. And I certainly respect those on the other side of the aisle or those on the other side of this argument. But I do believe ultimately this is about how do we have a long-term reauthorization that businesses can count on that allow us to compete on a level playing field so that United States businesses can grow and win. I thank you so much for being here today. I appreciate the opportunity to come and talk to you. And again, thank you so much for your time. Thank you, Congressman. I'm going to ask the panelists to join me up here. Please come on up. Thank you. I think you all have the biographies of the folks in front of you. But we really have a very interesting panel to unpack the issues that are in front of us here at this time on the Ex-Im Bank reauthorization. It's Scott Schlegel as Chief of Staff to Chairman Hockberg. And then we also have Linda Conlon, who's come in from Philadelphia and is the former Vice Chair of the Ex-Im Bank Board, but works on trade issues in Pennsylvania and New Jersey at the World Trade Center there. And you have her biography as well. And then we also have Don Nelson, who's on an advisory board for Ex-Im. He's a small business owner that works with Ex-Im primarily in the Middle East. And then we're very fortunate to have Linda Dempsey from the National Association of Manufacturers. Thanks for being all of you with us. I'm going to ask Scott to start. I'm going to ask each of the panelists to talk for five to seven minutes to share their perspective on Ex-Im Bank. And then we're going to take it from there. We'll open up the discussion. Good. Well, thanks, Dan, and thank you to CSIS for holding this important forum today. It is extremely important to hundreds of thousands of individuals around the country who have relied on Ex-Im financing over the last 80 years that Ex-Im Bank be reauthorized. So just a bit of background. Ex-Im Bank is the official export credit agency of the United States. Our mission is to support U.S. jobs through exports. And we meet that, have been meeting that mission for more than 80 years now. The jobs that we have supported are significant. We've had 164,000 jobs estimated that we supported last year through the financing at Ex-Im Bank and 1.3 million jobs since 2009. We do this by providing loans, guarantees, and insurance to exporters and foreign purchasers of U.S. goods and services. We finance businesses large and small, and we do this at absolutely no cost to the taxpayers. And actually, we generate a profit, as you heard earlier. Last year, we generated $675 million, and the previous year, we generated more than $1 billion for the U.S. taxpayers. Now, that's above and beyond all of our operating expenses and all of our loan loss reserves. We underrate all transactions ourselves, which must meet strict standards of reasonable assurance of repayment. We're not an aid agency. We're not a development agency. We're a bank. We expect to get paid back. And we're very prudent with the taxpayer dollars. Our default rate shows that. We've got a default rate of less than 2 tenths of 1 percent, which is a very low default rate. Ex-Im Bank is congressionally chartered, and among other things, Congress has asked us to look at three different mandates, one being renewables, another being small business, and the third being sub-Saharan Africa. We work hard to meet these mandates. We have financed our fair share of renewables, and last year we financed $198 million to support U.S. export related to renewable energy sources such as wind and solar. With regard to small business, last year nearly 25 percent of the dollars that we authorized were for small businesses, and nearly 90 percent of the transactions were for small businesses. Of the 3,000, of the more than 3,700 authorizations the bank financed in 2014, more than 3,300 of them were directly for small businesses. And our small business footprint is even larger when you take into consideration the supply chain of all of the larger business exports that we do, and there's a lot of small business that feed into that. With regard to sub-Saharan Africa, in the past five years, Ex-Im Bank has approved more than $6.3 billion in financing for exports to sub-Saharan Africa, including a record setting $2.1 billion of authorizations in 2014. A few examples of that sub-Saharan Africa financing include 300 electric diesel locomotives from GE, transportation in Erie, and Grove City, Pennsylvania, to TransNet in South Africa, Boeing aircraft that we financed to Kenya Airways, and power generation equipment that we financed to a Zito power in Cotabar. These three projects alone supported an estimated $8,000 U.S. jobs. So in order to keep supporting U.S. jobs and generating money for the taxpayers, we need to be reauthorized by June 30th. In the House, there's a bill that you heard from Congressman Doald about that he and Representative Fincher are on, along with 57 of their colleagues. It would reauthorize the bank for five years. There's also another bill over in the House that wasn't mentioned. This is sponsored by Representatives Waters, Hoyer, Moore, and Heck. That bill has 189 cosponsors on it and would reauthorize the bank for seven years. So when you take the number of cosponsors on just those two bills alone, you have more than 50 percent of the U.S. House of Representatives that have put their names onto bills cosponsoring them to reauthorize the Export-Import Bank. That's a very strong showing in the House of Representatives. On the Senate side, as was mentioned by Senator Doald, there are six members who are working on a bipartisan bill. Hopefully that bill will be introduced fairly soon, maybe as soon as the next day or two. Senators Kirk, Blunt, Graham, Heitkamp, Donley, and Manchin are in discussions on that particular piece of legislation. And we'll work closely with the House and Senate on passing a bill that meets the needs of the wide bipartisan groups while maintaining our ability to support U.S. jobs and meet foreign competition. There are some 60 export credit agencies around the world that are financing their country's exports. We are a critical tool to allow American companies to compete in the global economy. Without us, many companies will lose sales to foreign competitors. The United States cannot afford to unilaterally disarm and leave the 3,700 companies that we financed last year, again, nearly 90 percent of which were small businesses, without a critical tool to counter their global competition. Foreign export credit agencies around the world are watching this debate. They would love nothing more than for Export-Import Bank of the United States to go away. They would love to be able to scoop up those jobs that are out there that we financed and take them to their country, take them over to France or South Korea or China. And we can't afford to allow that to happen. So we look forward to working with our broad bipartisan group of supporters in Congress to ensure that we can continue to support American products and American jobs for many years to come. Thank you. Thanks, Scott. Linda, thanks for coming up from Philadelphia to be with us. The floor is yours. Thank you very much, Dan. I appreciate the invitation to be a part of this very important panel discussion. And I also want to salute Congressman Dole for his leadership. When the invitation came to me to come here to Washington, I felt I couldn't miss that opportunity. As my bio reflects, I spent from 2004 to 2009 at the bank, the last three years of the bank, as not only a member of the board, but as vice chair of the Export-Import Bank. So I walked away with two things, knowing how important the programs and services are of the bank to U.S. exporters, both small and large, and with a fundamental appreciation for the 400-plus dedicated public servants with whom I had the pleasure and the honor to work. I've been, I've had the privilege of working within the federal government in a number of capacities, but I dare say that the individuals at XM Bank represent a particular dedicated group of public servants. So now I'm at the World Trade Center of Greater Philadelphia, and now I get the chance to really work with companies, many of them small and medium-sized businesses, helping them to have access to trade counseling, market research, business networking events, educational seminars and conferences, all with an eye to helping them engage in markets worldwide. In any given year, we work with 400 to 500 businesses. Again, most of them small and medium-sized businesses, and we're part of a worldwide network of over 100 World Trade Centers and some 300 countries, all focused on expanding global business opportunities for the companies that we serve. And if we take a look at the Metro Philadelphia region, it generates about $25 billion worth of exports. That was in 2013. As a World Trade Center, we cover both New Jersey as well as Pennsylvania. And if we look at our track record at the World Trade Center of Greater Philadelphia, since 2002, we've helped companies generate about $1.3 billion in incremental export sales, largely through the counseling that we provide to them. So we're pretty proud of that record. And one of the first things I did in Philadelphia when I came to the World Trade Center of Greater Philadelphia was to make sure that we had an export finance program. And we're proud to be a city-state partner along with the Export-Import Bank. And each year we put on seminars and workshops where we really run through the various ways that XM is able to support their global business needs and to minimize a risk and to help them expand sales, whether it's through insurance, whether it's through working capital support. And if you take a look at the number of companies in Pennsylvania and New Jersey that have been assisted and helped through XM's programs over the past seven years, there have been some 316 Pennsylvania companies that have been helped through XM Bank that supported about $7 billion in exports. Similarly, New Jersey, about 244 companies have been assisted during that time, representing some $5 billion in exports supported. The majority of those companies have been small and medium-sized businesses. And I'd like to end with just some facts to put things in perspective. And certainly Scott has shared some very important facts about the benefit and the importance and the value of the work that XM does. But let's just put this in context. What we're talking about is maintaining, advancing U.S. global competitiveness. 83 percent of global growth will take place outside of the United States over the next five years. Companies that export, on average, their employees earn 18 percent higher salaries. SMEs that export demonstrate greater revenue growth than those that do not export. In fact, if you look at those companies during the time of the recession, of our recent recession, SMEs who exported grew 37 percent, while those that did not had experienced a 7 percent decline in exports. Exports spur innovation. Those exporting companies tend to innovate more than those who do not export. And we talked earlier about competition from other countries. China has increased over the past 10 years its export finance support by some 800 percent. That's not going to stop. That's only going to grow. So the congressman made the point. Certainly Scott has made the point as well. It's very important to us that we maintain this very valuable tool for U.S. exporters. Thank you, Jan. Thank you. Don, you're a small business. You work with Ex-Im Bank. Can you talk about how you work with the Ex-Im Bank and why you're here today? Sure. Thank you. Well, thanks to everyone for coming and taking the interest and time to learn more about the importance of Ex-Im Bank. My name is Don Nelson, and I serve as president of Ramsgate Engineering and Pro-Gauge Technologies based out of Bakersfield, California. We're a company that manufactures specialty equipment for the heavy oil industry. We mostly export to the Middle East. We've been working with Ex-Im Bank since about 2008. And I can tell you without Ex-Im Bank we would not have exported anything. The Ex-Im Bank has allowed us to take on these contracts. I also was nominated this year to serve on the advisory committee of the Ex-Im Bank. And I have to say that I'm here speaking on behalf of myself individually and for my company not on behalf of the bank. I have no authority to speak on behalf of the bank. So I just want to make sure that's clear. One of the things that keeps coming up is that private banks can take over and fill the need. I have to say that it's not true. When we landed our first contract in the country of Oman it was about a $8.6 million contract. And we had to put up a bank guarantee from a local company, a local bank, in the country we were working in. And the only way we could do that was to issue a letter of credit from our bank of the United States to that foreign bank. So I came back home, went to our bank and told them what I needed to do. And they said, sure, we can do that but it's going to require 100% collateral. So 100% collateral is not possible for us to continue to operate if we're going to put all the money as collateral. They said you might go try some of the smaller regional banks. I happened to bank with Wells Fargo. So I went to the regional banks in our community and none of them would touch it because it was an international bank and they weren't comfortable with the risk. They recommended that I go back to the foreign country and meet with the banks again and see if there was some way that we could work something out with them. So I did. I went back to Oman. I met with the CEO and managing director of one of the largest banks in Oman. And they said, yeah, no problem. We can help you do this and you will not have to put up 100% collateral. And I thought, great, we've got this solved. And then he brought up the terms of the deal which was 25% interest and they controlled all the money for the project. So obviously that wouldn't work either. That's a non-starter. So at the 11th hour, you know, I went back home. At the 11th hour, I was talking with a friend of mine who happens to work at Wells Fargo and I was telling the story and he says, well, you belong with the international guys in San Francisco. They're the ones that could probably find a solution for you. So I ended up talking to them and sure enough they said, well, you might qualify for a program in the XM Bank. I've never heard of the XM Bank before. And so anyway, that worked seamlessly. It worked very easily. So the private market is not a solution for small businesses to do these foreign exports. It simply doesn't work. I was actually in the Middle East last week at an oil and gas trade show. And on my way back, I just started writing notes about some of the discussions that are going around about the XM Bank. And if you don't mind, I might just read some of this rather than try to wing it because I probably would leave a lot out. So one of the other things that comes up is crony capitalism, that it's only for the politically connected. This is not true. We've been using the XM Bank for about seven or eight years and the first time I've ever talked to anyone from the XM Bank was about six months ago. So I don't say how anyone could say that only the politically connected and the cronies can use the bank. It's most small businesses don't even know people at the XM Bank because they work through their local bank as we do. So sorry, Don, you want to just clarify. You're not a crony. Is that correct? I think that I'm speaking for myself and thousands of other small businesses like ours. So yes, you're correct. Also, any business in America that has a product they want to export and they have a solid business, I'm sure the XM Bank would be happy to work with you as long as you're, you know, the financials and all that stuff are in order. They're there to help small businesses export. So it's not just for a select few. It's for American businesses. The other thing that comes up a lot is corporate welfare. I believe this is also a false statement for the following reasons. We pay fees for the services we use at the bank. Everything we do with the bank, they charge a fee for. They make a profit on it. Every transaction we do with the bank, they make a profit on it. We get absolutely nothing for free. The bank has returned billions to the Treasury and it's creating thousands of good-paying American jobs. So corporate welfare is a false statement as well. Another thing that comes up a lot is risk for the American taxpayer. Some of the critics say it's not fair for the taxpayers to take this liability or risk of the XM Bank in supporting American businesses. For ourselves and thousands of other companies like us, we have to submit corporate and personal financials to our local bank. They completely vet our credit worthiness before submitting our application to the XM Bank. We have to guarantee our letter of credit with a corporate guarantee and with a personal guarantee. So the reality of risk to taxpayers is next to nil. In reality, the XM Bank exposure is spread across dozens of countries and companies. So if a company or country ever defaulted, it's merely a blip on their financials. The bank has a default rate of less than a half a percent and that's better than most private banks. Congress says they want to protect the taxpayers from the risk associated with the XM Bank even though the bank has returned billions in profit to the Treasury through the years. It seems like the critics, all they come up with is imaginary problems with the what ifs and ideology that they believe it shouldn't exist. I've personally met with several lawmakers over the past six months and I haven't met with one yet who really has any substance behind their argument. When we debate it, they tell me that I make good points but they just philosophically disagree. So far they have not articulated one issue that really justifies their position. And speaking on risk to the American taxpayers which seems to be their argument, the XM Bank has returned billions of dollars to the Treasury, has not lost any money. And when you look at risk, I don't know if you realize this or not but the Pentagon released a report a few months back where Washington has spent approximately $100 billion on reconstruction efforts in Afghanistan. It's $100 billion given that Afghanistan didn't create one American job. So if you look at that and you say, okay, well we've rebuilt in Pakistan, Iraq, who knows what countries. Then two weeks ago, the GAO, General Accounting Office released a report where Washington has spent $120 billion on waste and fraud, some $80 billion on Medi-Cal and Medicare fraud, and the rest, I just don't know where it went. So it seems like our congressmen should spend their time focusing on real waste in our government, not on a government entity that helps create thousands of American jobs and is very, very little risk to the American taxpayer. It seems like some of the newer congressmen that have come to town want to say that they've shrunk big government. You know, in one of the ways they want to do that, I think, is closing one of the smallest government entities, there is, the XM Bank, that therefore they can say we've shrunk big government. The reality, though, is they're talking about closing a government entity that creates thousands of jobs, returns hundreds of millions of dollars a year to the Treasury. It seems like their focus is wrong. They need to focus on waste other than an entity that actually creates jobs. From an ideological perspective, they're saying the government should be involved with financing of private business exports. The critics say the government should be involved with export finance private companies. And in a perfect world, this may be true, but we have to live with reality. And the reality is we live in a global economy where all industrialized nations have export credit agencies, just like our XM Bank. If we close our XM Bank, we will lose the jobs associated with these exports and that's hundreds of thousands of lost jobs. And those unemployed folks are likely to go into some form of government subsidy program because there aren't hundreds of thousands of manufacturing jobs just waiting for them to move to. The XM Bank-supported jobs create these XM Bank-supported exports create good paying American jobs and these jobs just simply go away if the XM Bank closes. And I can speak for myself that if XM Bank goes away, we will no longer be exporting. You know, we have, we were about 100 people and with the current oil price situation, we're down to about 80. But if we stop exporting, we're probably, you know, that's probably going to be an additional 50 people that we will no longer need. You know, I believe most governments are smart enough to know the best way to create new jobs and grow their economy is through exports. So their credit agencies are much more aggressive in supporting their business than ours is. As an example, Korea provided five times more export finance support to its exporters than America did for U.S. exporters despite Korea having an economy less than one-tenth the size of America. China in the last two years supported more exports than our XM Bank has in the past 80 years. Those are pretty bad statistics if you ask a small businessman. If we close the XM Bank, we will be the only industrialized nation without an export credit agency. This obviously will allow our competing countries to win the projects and the jobs. It seems we're also the only industrialized nation considering closing their export credit agency. So to make anyone with common sense can see this isn't a smart move for America. If I'm taking too much time, Dan, just tell me. Another thing that they say is government picks winners and losers. Critics say the government shouldn't pick winners and losers. And this is another example, in my opinion, of them not understanding the reality of the global business environment we live in. The XM Bank does not pick winners and losers between American businesses. All American businesses that have American-made products or technology with a solid and stable business has access to the XM Bank. However, if Congress shuts down our XM Bank, Congress will have chosen the winners and losers. Congress will have chosen America to lose and all other exporting countries to win. The other countries get the exports and the jobs. It's that simple. The XM Bank has flourished through the Great Recession, the Internet bubble, the banking crisis, the housing bubble, and has been around for 80 years, operating successfully, profitably, and creating American jobs. Closing it makes no sense. It seems several folks in our Congress make decisions based on ideology, regardless of the reality and the facts of the situation. We cannot and will not have a successful economy in America if Congress doesn't make decisions based on the reality we're dealing with. Congress needs to start using common sense and good business judgment. The United States of America is one of the largest businesses in the world, and one has to wonder if we have too many people in Congress with little to no business experience, little to no common sense, and truthfully unconcerned, they're going to destroy our economy and our country due to their poor judgment based on politics alone. I may get kicked off the advisory committee after some of these statements, but I'm okay because I think these things need to be said. Some say the Ex-Im Bank only supports 1.6 to 2% of all exports, and this may be true, but a 2% drop in GDP can also cause a recession. So these exports are very important, and they create thousands of American jobs. I don't have much time. I've taken them, but I'm good. Okay, I'll stop. So basically, Congress needs to do what's right and reauthorize the Ex-Im Bank, and they need to reauthorize it without demanding unrealistic changes that prevent it from operating successfully. Thanks for your time. Okay, thank you. Thank you. Thank you, Don. Thanks for coming in from California to be with us today. Linda, you're with the National Association of Manufacturers. I think you guys have a view on the Ex-Im Bank. We do as well, and the National Association of Manufacturers for those who might not know is the largest U.S. industrial association. We represent over 14,000 manufacturers in every part of the manufacturing economy in our country and every single state. Manufacturing remains an economic powerhouse for the United States and fuels more than 12 million jobs. Last year, we had a record level of nearly $2.1 trillion in manufacturing output, and we had the highest level ever of manufacturing exports at $1.4 trillion. Those exports, those manufacturing exports provide good paying, some of the highest paying jobs across the manufacturing economy, and Ex-Im Bank is an important and increasingly growing part of the success of America's manufacturers and our export success. You heard some great comments today with which I agree full heartedly about the types of benefits that the Ex-Im Bank provides at a fee, at an interest in a self-sustaining manner that pays for itself. Let me give you a few more because most of our members at the NAM are small businesses. Some of those businesses have only recently started exporting, and when they've exported, what we've heard are stories of success, stories of job growth, and stories about wanting to continue to do so. Consider the case of WallQuest, a company in Wayne, Pennsylvania, about 20 minutes from where I grew up that is a family-owned company. Back in 2008, WallQuest was an 80-person company, and they began using Ex-Im Bank working capital services because commercial banks will not provide to an ex, will not use the export as collateral, and so these companies like WallQuest can't get these types of loans and working capital services from their own commercial bank. Within four years, WallQuest, which produces wall coverings to countries around the world, has more than doubled its employment to 185 employees, and 90 percent of its American-made wall coverings are sold overseas. And as the WallCrest Vice President Jack Collins told us, WallQuest's growth not only provided new employment for WallQuest, it helped WallQuest's raw material suppliers here in the United States. It helped the local services economy in Wayne, Pennsylvania and nearby counties because WallQuest was growing more and needed more services. Consider the case of Lyon Precision, a 30-employee company founded in 1958 in Minnesota. It was the first company to ever provide, create a capacitive displacement center. What's that? It measures very small distances, very important for all the type of precision manufacturing, a vast array of companies used throughout the United States, and yes, around the world. Over 40 percent of Lyon Precision's sales are now overseas. Their President, Don Martin, has told us that because of the XM Bank, which provides receivables insurance to them, they can complete transactions in hours with foreign customers because they have that guarantee that they will be able to be paid for their exports when they go overseas. And by streamlining his export processes, Don has been able to advance and expand this company's exports over the last number of years. One last company I'll mention right now because we've already heard from Don who has told a great story, but consider the company Air Tractor in Olney, Texas. They employ 260 of the 3,000 residents in Olney, and I think we've heard from them that there's maybe one light in the town. They use the medium-term credit insurance so that they can extend credit to foreign customers in the form of a promissory note payments to Air Tractor. And once Air Tractor has that XM credit, they can sell that note to their commercial bank for cash. Since 1995, when Air Tractor first started using XM sales, they grew their exports from 10% to nearly 50% of all their sales and have created 65 jobs in this small town in Olney. Air Tractor Vice President for Finance, Dave Eckert, has expressed his concerns that if XM is not reauthorized, it could mean the difference between a thriving town or a community in decline. And those are the stories that we at the NAM hear every day from our members as well as many others in the manufacturing and other small businesses throughout this country. Without the bank, many aspiring manufacturers in the United States would find themselves excluded from the global economy, where frankly the odds are increasingly stacked against them. The level of support provided by XM Bank is dwarfed by that of our international competitors. You heard Dawn and Linda talk about this. Last year NAM commissioned a report to analyze our nine largest competitors in this area to see what they're doing. There are more than 60 foreign export credit agencies operating right now. Our top trading partners provide nearly half a trillion dollars in assistance annually, more than 18 times the size of the export import bank. China alone provides at least five times more support for its exporters than the XM Bank does and fuels more than 12% of China's exports through export credit agency support. Canada fuels 20% of its exports through its export credit support. Meanwhile, the XM Bank as you've heard impacts about 2% of U.S. exports but yields huge results and supports millions of jobs. It is a targeted and last resort tool which helps our businesses find a foothold in a competitive global economy that is just becoming tougher. Unfortunately, the future of this job creating tool is now at risk as we are approaching the deadline that Congress had last set. America and particularly Congress has a question before it and for the NAM the answer seems simple. Do we want manufacturers in the United States to win sales overseas that will sustain and grow American jobs? Or do we want our foreign competitors and their foreign workers to win those jobs? That's the question that Congress has before them. We appreciate the work that we've seen in both the House and the Senate to move forward legislation. There is, as Congressman Dold said, rank and file support of a majority of Democrats and Republicans in both the House and Senate that will support XM reauthorization once it comes to the floor. Congress needs to move now because the uncertainty that is being created by the impending expiration of the XM banks authorization is costing our manufacturers right now opportunities for new sales and it's going to cost us jobs here in the United States. Congress needs to act now. Thank you. Thanks very much. I wanted to put a couple questions to the audience and then I'm going to open it up because I know there's a very knowledgeable audience. Can I get some reactions from the panel about the critique about 70% of the portfolio? I want to hear from Scott about this but I'd like to hear from someone other than Scott about this as well. About when the criticism is 70% of the portfolios with 10 companies, what is your response to that? Maybe both Linda's might chime in at Don. You want to comment on that as well? That's fine as well but please go ahead. I'm happy to start. Linda, do you want to start? The fact that or the point that I remember from the congressman's remarks today was that when a Boeing aircraft lands 19,000 small businesses land with it. The fact is that the larger transactions support a lot of suppliers and sub-suppliers and many of these suppliers are small and medium-sized businesses. One other fact that is often misunderstood or overlooked is that the fees that the XM Bank receives on these larger transactions go back to support the operation of the bank which supports 90% of authorizations go to small and medium-sized businesses. And I know from being on the ground there in Philadelphia and working with small and medium-sized businesses there's a lot of hand-holding and rightfully so. So it takes an enormous amount of time and time well spent to help these companies really make sure that they understand the tools that are available to them. So I would say these larger transactions enable the bank to really dedicate the time and resources to help small businesses as well. Linda. Let me second that. You know there are over 3,300 small businesses, small medium-sized businesses right now that are growing. I was just talking to a company Draper out in Indiana that has now crossed the threshold from small to medium-sized business because it's been able to export more. But certainly we see and we saw this just a few weeks ago when we as part of the XM for exporters for XM Coalition brought in more than 650 folks from outside Washington D.C. They were the suppliers to many of the larger companies that already use XM. And you hear it, even small companies use suppliers for their production. And the larger companies are using tens of thousands of suppliers each. Many of those companies, we call them invisible exporters, don't even realize that their product is going on a piece of capital equipment, a bulldozer, a plane, anything going overseas. But those companies and their communities and all the companies they rely on also benefit from this. I think Linda and Linda both articulated very well some great points and push back to this. The fact of the matter is also that in addition to the fact that all of these medium and large businesses have tens of thousands of suppliers, many of which are extremely good paying jobs, family sustaining jobs. When you slice the data the way that they've sliced it in order to get this statistic, they take a look at our entire portfolio over the entire portfolio and exposure right now. And that excludes a large chunk of the small business because that's short-term transactions that kind of roll on and roll off within 12-month time frame. So they're just looking at the larger longer-term transactions when they use this data. But as both Linda and Linda pointed out, the fact of the matter is, is that financing supports tens of thousands of family-sustainable jobs. Can you talk about the issue of crowding out? I mean, when I worked at IFC, the Development Finance Institution, sometimes this comes up with OPIC, the Overseas Private Investment Corporation, that institutions like ExSim Bank are crowding out the private sector. Don obviously told a story that doesn't necessarily comport with that critique, but maybe I might ask, can I ask both of the LINDAs to comment on this issue and on this issue of crowding out, if I could? I think there is a big misperception there. First of all, ExSim Bank, while they do make some direct loans, the large majority of the loans that they provide are in the form of loan guarantees, rather, that the loans are made by commercial banks. And many of these banks would not be able or would not be willing to provide these loans, particularly to small and medium-sized businesses, because the amounts of the loans are smaller, and yet the administrative work is still there. So without ExSim Bank's support, they would be reluctant to make these kinds of loans to our small businesses. And I worked day in and day out with many of the leading trade finance banks of companies in Pennsylvania and New Jersey, and I don't know how many times they've shared with me, look, we want this business, but it's just too costly. So we need the ExSim Bank. Let me add, there are several types of instances where we really see that commercial banks continuing to refuse and not be interested, talked about already the fact that commercial banks will not give small business exporters working capital, except if they take that collateral of the export, and so that's basically an unworkable situation. We also see several other instances. When companies are trying to sell beyond the developed world to Africa, the Middle East, Latin America, countries where there's a bit more risk, a lot of commercial lenders will not be doing that. Well, we've already done a loan into West Africa. We're not doing another one for the next few years. And so that is an opportunity where ExSim Bank needs to fill in or we will lose those sales to foreign competitors. Another big area is big infrastructure, complex multi-year types of deals that are going on outside our borders as an area where the United States really wants to participate more, but has not been able to as much. And this is an area where commercial banks, again, are not providing the direct types of funding, financing that's required. The last one is, you know, a lot of our companies sell to state-owned enterprises, foreign governments, and a small medical rehabilitation equipment producer up in Maryland, BT Technologies, will tell you, a lot of their equipment goes to state-owned hospitals. That state-owned hospital needs to see a government entity at the other side of the table. Lots of these other, you know, their competitors around the world, their export credit agencies are right there. Sometimes you don't even need the services that ExSim provides, but just partly being in the room when you're trying to make these sales. I think to follow up on whether ExSim is crowding out commercial banks, I think it's the statistic is like in the high 90s, the percentage of all transactions are in conjunction with the commercial bank. So the commercial banks are not being crowded out. That's not a true statement. Let me ask, I know that ExSim Bank responds to the real economy, and so it's not a question of ExSim Bank saying, well, I want to do more in Africa, or I want to do more in the Middle East, and is responding sort of to globalization. It's a vector for globalization. It's in some ways a fuel injector for globalization. But could each of you very briefly talk about, when you talk to either as a company or as you're talking to members of your association or member, if you could just talk a little bit about what, if it was reauthorized, what are the sorts of activities you expect to see going forward? Maybe I'll start with you, Scott, and we'll just go down the panel. Sure. Well, we have a significant pipeline right now of projects that are long-term projects that we would expect to come forward over the next several years. Many of the projects, the structured finance projects, are large, whether it's like a large LNG facility or a nuclear power plant or mining operation. Those all take many, many years to both kind of become fully baked, and so they'll start coming to ExSim to talk to us several years out. Same thing with aircraft. But then, again, you have the thousands and thousands of small business transactions that would go on, which are much more difficult to predict further out, but there are a lot of structured finance projects out there. Let me just call on a little audible. I'm just going to ask Linda Collin to answer this, and then I'm going to go out to the rest of the audience if you guys don't mind. Linda, when you talk to your members, when they say, I want to use ExSim Bank, what are the sorts of things you're seeing out there in terms of where you think you're going to see, what are the kinds of activities you're going to see more of if it was reauthorized? And Linda commented on this, that ExSim is there to level the playing field and to operate in markets that are perceived to be of greater risk. So I can see as our exporters mature, and as they expand from one to two to three to four markets, they're certainly going to look at markets that are riskier. And there, I think, is where ExSim is going to also play a role. They're always going to look for reasonable reassurance of repayment and do prudent underwriting, but I think that's where they can be helpful. And let me just give you one example of a company that's now working more in developing markets, and that's Bassett's Ice Cream. And thank you, Linda, for mentioning WallQuest, which is one of our members. I eat Bassett's Ice Cream, by the way. I'm a happy customer. I hope you do a lot. I hope all of you out there are familiar with Bassett's Ice Cream. They introduced some terrific ice cream. They were actually founded in 1861, yet it wasn't until 2008 that they just began to export. And now, with the help of ExSim's single-buyer policy, getting receivables insurance, China now makes up 20% of this ice cream wholesalers business, and they're looking at markets like Vietnam and other markets in Asia. Who would think ice cream from Philadelphia going into China, around the world? But it really, I have to say this sincerely, was made possible with the comfort level that they received through export receivables insurance, now looking at working capital opportunities. But I hope we'll have an opportunity to talk about looking to the future and what we will need from ExSim Bank as well. Why don't we just spend a minute on that, because I do want to hear from the audience. Let's talk about what do we need in terms of a future ExSim Bank, because I do think this is, maybe I might ask the lindas and Don to answer the question of what improvements do you need, or what are the sorts of things you want to see in a future ExSim Bank in terms of, certainly there have been significant efforts to, and people are happy with ExSim Bank, but what are the sorts of things you'd like to see in the future? Why don't I start with you, Linda Dempsey. Sure, thank you. Look, in 2012, when ExSim was reauthorized, it underwent about 18 reforms, and we did a checklist on that. It met all of those reforms. But companies continue to see areas where we can have improvement, improved communication. I mean, they've done so much to attract the small businesses, and it's hard to get small businesses who haven't been exporting to get that type of comfort level. But we would see some streamlining of, you know, policies on the communication side, on responsiveness side. Also, looking at broadening the scope of ExSim Bank's operation, dual use is an area where we sell to our allies overseas, but we just don't have financing available for that, and that's an important area where we're looking to see some broadening. Don? Yeah, I'd like to respond to your other question real quick. And going forward, from our perspective, we're just starting on the engineering for a project in the Middle East for a steam plant, and they're expected to order the equipment fourth quarter this year. Probably it's going to be anywhere between 30 and $50 million order. If ExSim Bank is not reauthorized, that's an order we will not be able to fulfill, and there's a lot of jobs associated with that. As far as going forward with the bank, it would be nice if, and I don't know if it's possible, but if the bank could help support small businesses in a marketing fashion to let these foreign countries know that the ExSim Bank is here to support the small businesses. And the reason I say that is we lost a job to China because their expert credit agency went to that country and closed the deal for them. So, Linda? First of all, I think ExSim is, and as you can tell, I'm a big fan of the bank, understandably, so, but it's doing a great job in trying to reach out to small and medium-sized businesses. It's a huge task, but I think over the last several years, I've seen really ExSim expand its efforts to reach small and medium-sized businesses, and I would continue those efforts. I would strengthen those efforts. I think part of the challenge is not that there's a lack of resources, but that more companies need to know that those resources exist. It's true of the U.S. Department of Commerce efforts. It's true of our efforts to reach more companies. It's certainly true of ExSim, so I would say continue doing that. But please, our respective members of Congress do not embed in the legislation reforms that represent a lot of belts, what I call belts and suspenders. Yes, make sure that the process is transparent. Make sure that the bank is always accountable to U.S. taxpayers, but do not embed the legislation with a number of reforms that make it so that the bank is focusing more on being responsive to these reforms and less on the business of helping U.S. exporters succeed abroad. I think that's very important. Continue ExSim Bank on increasing the turnaround time. Time is money. You know that, Don. The time between the requests for the financing to the actual financing being given, you're making great strides in improving the turnaround time, that's absolutely, absolutely essential. So you're doing a lot of things very well. Continue to do them. And Congress, please, in your wisdom, make sure that the legislation doesn't prevent the bank from doing the important work that they need to do. Okay, I want to hear from a couple of folks in the audience. I want to hear from my friend Mima Nadelkovich and I want to hear from this woman. These two folks are going to be the two comments in name, rank, serial number, and keep it brief. Good morning. Thank you. I'm Mima Nadelkovich, I work for Global Development, we're a worldwide network of business leaders, CEOs investing in Africa. 25 years ago, I was USD, the African Development Bank, and in between years, we come back to ExSim, structuring agro-industrial developments throughout Africa. In fact, Air Tractor was a supplier to one of our projects with a Schaefer Group out of Louisiana. I'm baffled. I must say, and I'm sorry, we don't have the opposite sort of picture on the panel. I don't understand what the argument's about. If we are speaking of markets that are tough to penetrate, we speak of Africa. We're talking about a continent that will be doubling in size. I don't know how many, six of the fastest-growing economies. The most difficult place, and I can imagine, now I'm going to his bank and saying, oh, man, I want to export to Guinea to tell you to walk out the door, I would imagine. So why are we even having this discussion? I would argue, in fact, the very opposite. Really, the ExSim bank needs to get more into it. You know, if business is, it's a peaceful warfare. You want to be competitive. Why are we unilaterally disarming? I'm conservative, but I don't understand this argument. I'd like to hear why, what is the argument for not doing so, particularly we're saying we want to go into the tough markets, we want to go into Africa, renewable energies, very high risk, the commercial banks will not cover that. And I've got to see how ExSim bank and somebody make a logical argument on the bloody hill. Thank you. Okay, I'm going to catch this person and then we're going to give Scott a chance to respond. Go ahead. Good morning. My name is Diane Katz. I'm with the Heritage Foundation. And this morning, the panel and Representative Dold have understandably focused on the domestic firms that benefit from XM. I'm wondering if the panel could talk a bit about the competitive advantages that foreign firms get vis-a-vis domestic U.S. firms in terms of the subsidies that enable them to have lower operational costs and thus out-compete U.S. firms. Okay. Sure. When it comes to XM financing, XM will finance any of the U.S. content of an export that's going out of the U.S., so that's for goods and services. So even if you're a foreign company such as Siemens, which we do a lot of work with on renewable energy, we're happy to finance their renewable energy exports out of the United States because they're made in North Carolina where workers down there are benefiting from the financing that we would provide. With regard to the comment about difficult areas, you know, 68, more than 68 percent of our financing last year went into emerging markets. Of that, 63 percent of that financing was for small businesses and you're absolutely right because in those difficult markets, in Africa, sub-Saharan Africa, for example, we financed a number of fire trucks to Lagos, Nigeria that were made by a small company called Darley Fire Trucks up in Chippewa Falls, Wisconsin. Other products that we're financing into those countries are extremely important both from a clean water, water purification systems that we're doing in sub-Saharan Africa, other products that we're financing in there. It's both providing a service in goods for sustainability, providing power for people in Africa, but it's also building brand recognition and getting in on the ground floor of what is probably the last kind of untapped market out there. And so it's either going to be U.S. companies that are exporting to these emerging markets and building brand loyalty, or it's going to be Chinese or Korean companies that are going to be exporting there. And we want them to think of the U.S. products, whether it's GE or Coca-Cola or whatever the case may be, rather than Huawei or other countries' brands that they're exporting. Linda Comham. Sorry, sorry, Linda Dempsey, excuse me. Sure. Let's be clear. Exim financing is not a subsidy. You want to talk about China's export credit agency, Brazil, someone like that, that's a subsidy. The U.S. government for decades has led the world in making sure that the types of fees and interest levels that the developed world, the OECD nations are using, and they just did this recently in aircraft as well, is based on competitive market rates. No subsidy, period. In terms of the question about, well, you're disadvantaging others, what we're talking about is foreign transactions that are happening anyway. So if you're a foreign airline and you're purchasing aircraft, the question that Exim Bank helps America solve is whether those aircraft will be produced in the United States with U.S. workers or they'll be produced overseas. These transactions are going forward. That's true with every other transaction out there. They're going forward, and the question is whether we're going to lose an opportunity to sustain and create really good-paying American manufacturing and other jobs and help tens of thousands of suppliers, in some cases, or we're going to let that all go overseas. The United States has 9% of the world share in manufactured trade today. We should be doing a lot better, and if we can, we are going to grow millions of more good-paying jobs. That's what we should focus on. Linda Common, do you want to respond? A lot of great points have been mentioned, but let me just add. The most frustrating time I had at Exim Bank was when a company would walk into my office and say, Linda, I want to be doing major communications company. We have these contracts in Africa, but we are really being edged out of the market by China because of the term length to the financing, which far exceeded what Exim Bank was being able to do. So to the point of the question that was asked, yes, we are having to compete not only within the OECD, but with non-OECD countries who are providing what I think is predatory financing to their companies. So all the more reason for us to really, really be sure that Exim can continue to offer its financing programs. Don, do you want to comment? I think that they three have covered it pretty well. There are more questions. Thank you very much. I'm actually going to ask Fred Hochberg, who is the chairman of the Exim Bank, to come up and make some remarks. Fred, please come on up. Well, good morning. I would have been here earlier, because this is a great conversation. I attended a sweet 16 party last night. My mother turned 88. So I figured it was really a sweet 16 party. This is an amazing panel. As I've been listening to back through, I've been scribbling down notes. Linda Conlon was a spectacular vice chair of the bank. She left just before I got sworn in. And when she talks about reforms, I think the key thing is, as Linda very well pointed out, is let's make sure we're not hurting small businesses. Let's make sure we're not hurting our competitive list. And let's show we're not bogging ourselves down with bureaucracy. In terms of, we put in a dozen reforms three years ago, which are more transparent, looking at our default rates and so forth. Those are all good. We just want to make sure that we don't actually cripple the business. And Don, I got a chance to know because he's a great exporter and has been using us and demonstrates it. I was so impressed when I met him. We put him on our advisory committee and he was here last week for that. And I see Pat Lewis in the front row, who's also one of our directors who President Obama just re-nominated for another term just last week. So at this point, you all pretty much have a good idea of what we do. We're the official exporter credit agency of the United States. And we work with small and large companies, but as we mentioned here in Scott, as our Chief of Staff mentioned, 90% of our customers are small businesses. And we produce some of the best and most innovative products and quality products and delivery and deliver them on time and deliver them transparently from probably any other country in the entire world. And we create a lot of really good jobs as a result. And in fact, yesterday, as I said, we had an advisory committee meeting and one of our other small businesses that I met in the last year joined as a company run by a woman named Mary Howe, a family business in Chicago. And I spent a half a day with Mary and I learned more about the flake ice-making business than I ever thought one could. And her company was started by her... Well, she's fourth generation, so I'm going to lose track of whether that's great-great-great-grandfather or just great-grandfather. And they make the kind of ice you see that fishing boats use or that you'll find in a whole foods or a safe way, a seafood counter to make sure it keeps the fish or fresh foods fresh all day. And when the recession hit, in particular, she lost a lot of her sales in 2008-2009. She'd been exporting, but she really had to step that up because like many business owners, and I've heard this over and over again with family businesses, actually, they don't like to fire people. They like to hire people. And important for Mary was not just hiring people, but keeping people on the payroll. So she looked at the 95 percent of the customers that live outside the United States and she now exports to 100 countries. But the way she does that is she said, I need to make sure I'm going to get paid and she could not get what's called credit insurance, the way you'd get fire insurance and theft insurance, credit insurance, but we actually insure receivables from overseas customers so that she knows that she's going to get paid. She can sell an open account 60 days, people get the goods, then they pay her. She now has, she exports to 100 countries. She has, it's a small business, 40 employees and there are thousands and thousands of companies just like that one. I want to ask a question. This group, I was asked this not too long ago. Anybody remember the car of the DeLorean? Yes, of course. Anybody own one? They didn't sell that many. The reason I mentioned that is when I was in the business, in the catalog business 20, 30 years ago, a friend of mine owned a DeLorean. God, it was in the late 80s. And we had a board meeting for the trade association. I said, I want to show you the car. So I go out to the parking lot and I look at the car. It's a beautiful stainless steel car with those gold wing doors. And I look at the license plate and the license plate says Plan B. I said, Michael, why is the license plate Plan B? He said, Fred, Plan A was, this was going to be a company car. They didn't buy it. So Plan B was, I bought the car. The reason I thought of that is I was at a panel just like this at the Chamber of Commerce and somebody said to me, well, what happens if the Ex-Im Bank isn't reauthorized? What's Plan B? And I thought for a moment, I said, well, frankly, we're Plan B. Plan A is the private sector. We have the best private sector that with the deepest capital markets the most liquidity of any private sector banking system in the entire world. But it does not fit every situation and every market as we've talked about, some of the developing markets and some products and services like Don's company or frankly, Mary's company. She went to the private sector. They were not interested. They were not interested in doing business with her due to the size of her business and the location she was exporting to. So first is Plan A, the private sector. We are Plan B, unlike that car license plate because our job is to fill in gaps. Now, we all know the alphabet. If there's no Plan A and there's no Plan B, what's Plan C? China. Let's be very clear. That's Plan C. If we are not there, if we are not there, China will be very happy to step in and fill in those gaps. And let me give you a little, a quick history on this. Just a dozen years ago, we were the largest exporting country in the entire world. Nobody exported more goods, more manufactured goods or any kind of goods than the United States. Nobody until 2002. 2002, Germany overtook us. 2010, China overtook Germany. And frankly, with the strength of manufacturing, the emphasis on exports in the last few years, the National Export Initiative, the President Obama champions, we moved back into second place. And frankly, there's no reason we can't go back to first place. Now, in China, exports are about 30 percent of that economy. In Germany, it's 52 percent of that economy as exports. Korea, also 57 percent. Great Britain, lovely country to visit. They don't make a lot of things like we do, 30 percent exports. Where are we? We're just under 14 percent. Do you know who we're tied with? We're tied with Haiti and Rwanda. That's our peer group. So just think for a moment if we get exports up to 15 percent, 16 percent, how that turns things around. How that puts more people to work. How that fixes the balance of trade. How that puts a lot of things into place in our country. I like it a little bit to diet and exercise. You know, a little less eating and a little more exercise, and you get into shape. Much faster. Same with our economy. A little more exports, we change the entire mechanism of our economy. Now, there are 59 other export credit agencies around the world. We are not alone. Countries like Russia and China are exceedingly aggressive. And as mentioned up here, they're not members of the organization of economic cooperation development. That sets kind of global framework or rules for export finance. So, when I meet with U.S. exporters, people like Mary Howe, Don and others, all they are looking for is a level playing field. And that's all we're trying to do is make sure there's a level playing field. Now, in the, I want you to think about this number. It's a big number. $600 billion. $600 billion. That is the total amount of loans, insurance, and guarantees the Export Input Bank has done since 1934. That's the total amount of loans, insurance, and guarantees the Export Input Bank has done since 1934. $590 billion to be exact. In the last two years, last two years, China has done $670 billion. In two years, what took us 80, 81 years to do. So, we do have formal competition there. We do have every stiff competition. And I just want to make sure that we can support our exporters, support companies like Mary, the private sector's not there, or when they're facing the likes of a Chinese competitor who has the backing, the full backing of their government in every way, both sometimes subsidies in the manufacturing process as well as on the export finance process. But I believe we can be the number one again, and the benefits of that would be enormous, but not if we don't have a level playing field. Last year, we supported 164,000 jobs through our financing. 164,000 jobs. That's about 500 jobs every day of the year. 164,000 jobs. And we do this at no cost to the taxpayers, as Linda said earlier. We collect a fee for our work, premiums, interest rate, and so forth. We then put aside a loan loss reserve account like any responsible financial institution. Congress says we can keep about $100 million to run the place. And the rest, think about this, revenue minus cost, what's left over? Profit. Profit. Problem is, we don't have the word profit in our, in the government budgeting. It does not exist in the federal budget. So instead of profit, we have a word called negative subsidy. That's what, that's our word for profit. So, you know, it's like when you go to the doctor and he says everything is negative and you're supposed to feel good. It's the only time, right? So the same thing, it's okay. Positive subsidy is not okay. So last year, we turned over to the Treasury, we delivered to the Treasury, we wired cash to the Treasury, $675 million. That was our profit or negative subsidy. I like the number so much, it's my password. Just, even the C, C-spend audiences don't tell anyone. I gave away my password. My RIT people will not be happy about that. So we want to make sure that companies here and others can grow their business, make long-term plans, invest in innovation and make plans over time. We can't make plans 16, 90, nine months at a time. We have to make long-term plans. There's a lot of uncertainty out there. There's a lot of uncertainty in the global economy. There's a lot of uncertainty in global markets and we would like to be some form of certainty here at home. So thank you for inviting us. Thank you for having this panel and if I have time, for questions if you'd like. Okay, we'll take two questions. Okay, we're going to, that gentleman there and this woman here, these two folks. And the deal is you got to keep it brief. Name, rank and serial number and keep it brief. Well, I'm an RE officer so I won't give my name and rank and serial number but I represent some manufacturing companies. My name is Patrick Wilson and Mr. Chairman, I applaud your reminder about global competition and I'm wondering if you or other panelists would like to comment on the recent announcement of the Chinese infrastructure bank. $60 billion, the initial commitment to that. Several of our European allies have contributed to that infrastructure bank. How does that change the game for XM competitiveness? And this woman here. Thank you so much, panel and Mr. Chairman. Question for the chairman. XM seemed to be running a commercially viable establishment and yet you seem to be a part of the government. I'm calling it quasi government agency. What are the, is there any thoughts about or are there any thoughts about privatization, privatizing the eggs, if the worst case scenario happens you can compete and my question to the panel, can you shed some light on the service sector? Their service, obviously the service sector has to support manufacturers with good brick and mortar things, right? They're soft service providers here in Washington, D.C. that has significant exposure across border because they can't get working capital or risk protection from institutions like XM. Is that an area that one probably could be thinking of as one has, there is growing demand for certain type of services abroad, especially West Africa. Got it. Okay, I'm going to hear from the chairman. I also want to hear from Linda Collin to answer the issue of service sector. Okay. So the Asia infrastructure investment bank, bank formed by China. There's been some more action on it. Listen, we need more money on infrastructure. We need more capital. There's no question about that. So from that point of view, if we have more entities, not just XM bank and the 59 or 60 other export credit agencies, that's a good thing. There are concerns, though, the rest of us abide by rules of transparency, rules around the environment, standards around social cost and environmental cost. So the unanswered questions are how will that be in any new environment? Will there be a level playing field for any company to bid on projects? Or will shareholders of the bank have the upper hand when it comes to bidding? So I think those are some unanswered questions we don't know the answer to. So it's very hard to just have a yes-no answer at the time. So more capital is certainly good, but it's got to be capital that's clear, transparent and operates in a way such as many of the other export credit agencies do, or the World Bank does and others. Quick question on private. I'll also jump in on services. We do a lot of services. Last year, 5%, 3 years ago, 30%. So it depends on the year. When it comes to engineering services, a lot of large projects, a large portion of that is services. Engineering fees, architecture fees. We did a power plant in South Africa. The only thing we did was services. The engineering show. Not one bit of material, not one bit of goods, only services. Privatizing the bank, we have a great private sector. We step in when the private sector can't. So the whole point of us is we are there when the private sector is unable to do so and because we're backed by the full faith and credit of the U.S. government. I think you wanted to jump in. Linda, do you want to make a comment? Interesting question about services. At the World Trade Center of Greater Philadelphia, we found we're involved right now in developing a new export strategy. We're one of the eight metro regions chosen by Brookings Institution and JPMorgan Chase to participate in their global cities initiative. And we're finding that something like 44% of our exports are in the services sector. So we want to look more into that and to see how we can certainly make export financing more available. But I do get asked the questions when we conduct our export finance seminars. Is this financing also for services? So it's a question that companies have. Please join me in thanking the panel. I think we need to.