Politics & Policy

Will Obama Follow the Law and Liquidate the Export-Import Bank?

Ex-Im Bank president Fred Hochberg (Brendan Smialowski/AFP/Getty)

‘Indifference to the rule of law” — that is how Mitch McConnell described the Obama administration in 2013. At the time, McConnell was talking about welfare work requirements, initial actions on immigration, appointments to the National Labor Relations Board, and impending maneuvers on Obamacare. Bolstered by recent court decisions, there are few indications that Barack Obama intends to respect the law at written.

And today we can add yet another example to the list: the Export-Import Bank. With the bank’s expiration now a reality, an obscure part of U.S. law becomes relevant. Buried deep within the U.S. Code is the Ex-Im Bank’s new mandate:

Export-Import Bank of the United States shall continue to exercise its functions in connection with and in furtherance of its objects and purposes until the close of business on September 30, 2014, but the provisions of this section shall not be construed as preventing the bank from#…#exercising any of its functions subsequent to such date for purposes of orderly liquidation.

As Tim Carney explains, this is “basically Chapter 7 bankruptcy,” which “means Ex-Im is supposed to sell off the loans and guarantees on which it is currently sitting — not in a fire sale, but in an orderly fashion.”

EDITORIAL: Pull the Plug on the Export-Import Bank

The law could not be more clear, but the Obama administration has already signaled an unwillingness to comply. In an interview with The Hill, the bank’s president Fred Hochberg said he was “a long way away from having to make any permanent plans” to wind down the bank.

Hochberg is obviously pinning his hopes on Senator McConnell, who told the Associated Press earlier this week that it looks as though supporters of the bank “have the votes, and I’m going to give them the opportunity” to resurrect the now-expired agency. For good measure, “McConnell had told Sen. Cantwell that she would get an opportunity to offer an amendment on a bill that’s moving across the floor,” Senator John Cornyn informed Politico. “And I think she’ll have that opportunity.”

RELATED: Kill the Ex-Im Bank: We Don’t Need a Government Agency That Benefits Huge Corporations at Taxpayer Expense

It is ironic that Hochberg is seemingly reliant upon McConnell’s future actions to justify his own disregard for the law. Last year, in reference to Obama’s decision to delay executive action on immigration until after the midterm election, McConnell tweeted that the Obama is “just saying he’ll go around the law once it’s too late for Americans 2 hold his party accountable.” The year before, in 2013, McConnell had suggested that big labor union bosses and other far-left elements . . . have told Democrats it’s time to pay up, and they don’t have much time for things like the democratic process or the rule of law.”

Perhaps Hochberg is auditioning for a future job with the Supreme Court, but the expiration of the bank’s charter isn’t merely a “lapse” in lending authority, as he suggested multiple times last week. July 1 ushered in a new phase for the bank. The bank’s job is no longer to subsidize foreign governments interested in buying a cheaper Boeing plane or GE locomotive. Instead, its objective is an orderly liquidation, administration of assets, and collection of obligations.

RELATED: The Ex-Im Bank Is a Waste of Money

Hochberg, and many others in the Obama administration, appear content to ignore the letter of the law. If they refuse to follow a long-standing law, what makes any reasonable lawmaker suspect they’ll embrace the “reforms” so many on both sides of the aisle claim are necessary?

Here is what we know: The Export-Import Bank’s charter has officially expired, and the law requires the bank to begin an orderly liquidation. Will the Obama administration ignore the law? Will Republicans care? We’ll find out.

— Michael A. Needham is the chief executive officer of Heritage Action for America.

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