The chairman of the House Financial Services Committee Chairman is calling on President Obama to cut off all business pending between the Export-Import Bank and Russia because of the nation’s recent actions in Ukraine.
“The situation in Ukraine grows worse every day,” wrote Texas U.S. Rep. Jeb Hensarling in a letter to Obama, Sec. of State John Kerry, Sec. of Treasury Jack Lew, and others.
“Russia bears responsibility for this conflict, including the atrocity of the downing of Malaysia Airlines Flight 17, because Russia is supplying the separatists with advanced weapons and encouraging their attacks on aircraft and on the people of Ukraine,” continued Hensarling, adding that Russia’s recent actions “are in direct conflict with our national interests.”
The Malaysian airplane is believed to have been shot down by pro-Russian Ukraine separatists. All 298 passengers and crew were killed. The attack comes amid an aggressive power play by Russia over its western neighbor.
“Yet, still, the Export-Import Bank remains open for business in Russia,” wrote Hensarling.
He called the arrangements between the bank and Russian companies “sweetheart deals” and pointed out that business authorizations between the two have increased nine-fold during Obama’s tenure.
Russian companies that are already being sanctioned by the U.S. have benefited from relationships with the Export-Import Bank, according to Hensarling. He cited Vnesheconombank and Gazprombank, two state-owned Russian banks.
Hensarling called on Obama to use authority granted in the bank’s charter which allows him to deny applications for financing Russian companies.
“I therefore ask you to immediately halt any and all deals the Export-Import Bank is working on with Russia and with Russian companies and to suspend consideration of future Ex-Im deals involving Russia,” Hensarling wrote.
He also noted that a bi-partisan group of senators sent Obama a letter earlier this week asking him to “give additional consideration to imposing broader sanctions on Russia’s energy and financial industries, as other sectors of the Russian economy as appropriate.”
Hensarling has been a vocal critic of the Export-Import Bank, even apart from its business relationships with Russia.
The bank helps foster business deals between U.S. and foreign firms by providing insurance and financing guarantees. Its supporters claim that it is entirely self-financing and that it creates domestic jobs. Its critics disagree, saying that the bank promotes crony capitalism, benefits only large corporations, and does business with shady companies.
The debate has created a rift between small-government conservatives and moderates within the GOP who support the bank.
Hensarling hopes to block the reauthorization of the bank’s charter, which expires Sept. 30.