they're saying. i'm not a crony capitalist. i don't receive any welfare, corporate welfare, whatever you want to call it. we work hard. as a result of losing the memorandum of understanding because the korean bank came in with my korean competitor who had lost to me and basically came up and said, the bank's not going to be reauthorized. he's not going to get the deal. now my employees, including miss deerngs my general counselor, are on furlough. we're scrambling. please, words have consequences. be careful. i yield back the balance of my time. >> thank you. >> if the gentleman needs extra time, i would request the same time that was alotted to miss rugby when she went over her five minutes. do you need extra time? >> not at this time. hopefully, i'll have adequate time in my answers. thank you so much. >> thank you.

>> the chair yield to himself five minutes for questions. first, mr. wilburn, thank you very much for the service to your country as i thank captain moak as well. i used to be, prior to coming to congress, an officer in the green energy company itself. i don't know about your particular company but it's a subject i'm highly interested in. but, mr. wilburn, i'm still a little curious. i understand that you were on a flight, i guess, when you were sending your testimony. but i guess my first question is, was it -- simply a clerical mistake, or did you change your mind on whether or not t.a.r.p. regulations in dodd/frank played a role in failing to finance the brazilian company that sought your product?

so is it a clerical error, or did you change your mind about including that in your testimony? >> no, it's not a clerical error. i didn't have exactly all the facts. you'll see the rest of my written statement. i think it speaks to some of those issues surrounding what you're -- >> okay. mr. wilburn, you heard the testimony of others on this panel. and so you were very passionate with your testimony, but frankly, so was captain moak and mr. anderson as well. i've spoken to people, particularly those, for example, at cliff's natural resources who said, you know, they're having to cut hours for, you know, working people, single parents. and so i guess my question is one of fairness. perhaps ex-im -- i have no doubt it helps your business but do you acknowledge it can hurt

other businesses? >> i can't speak to hurting other businesses directly, unless i have more specific example, mr. chairman. but i can say this, that it's not my intent to harm anyone. but if i don't compete through the export-import bank, i know who's going to be harmed. because my competitors in foreign countries financed by their banks will get those deals. and i believe the same would happen to the aircraft industry if boeing doesn't sell those aircraft i think -- >> let me then ask you this question. fairness is a very subjective term. i understand that. >> right. >> but we seem to have a federal policy that says, you know, if you create a product, and you want to sell it to foreigners, if you want to sell it to the chinese, the federal government will step in and subsidize you. but if you want to sell your product to hard-working americans, then, no. no subsidies for you.

and so, i'm thinking about, you know, small businesses, my own district, a nexus personnel business services in mesquite. the owner said my mother and father opened up the business without any government subsidies. they used their own money, retirement, 401(k), other resources to pay rent. we had to go to auctions to buy office furniture. you know, small businesses like ours quote/unquote can't rely on the government. again, i guess by definition, you received the subsidy, you believe it's necessary to your business model, i accept that. but how is that fair to the other millions and millions of small businesses who sell to americans who don't get their products subsidized to the federal government? >> sir, i'd love to compete on a fair basis in america with my green technology to take bio gas into methane. i don't get a subsidy. i take exception to your remark. but my point is --

>> does ex-im not subsidize financing for your products? >> i don't believe that i'm subsidized. i don't believe that at all. >> yes, sir. >> let me speak to that point, if i may, mr. chairman with all due respect. and i do respect you from the bottom of my heart. my point is, you asked a question. i can't sell my technology here because there's barriers to entry to the market. and the barriers to the entry of the market is the oil and gas industry who subsidize with a 15% oil and gas depletion allowance. i don't get that as a producer. i can but my bio and gas into the pipelines in california. >> mr. wilburn, we'd be willing to work with you and be much more competitive in areas. i've got limited time. dr. de rugy. the opponents of keeping ex-im

as a status quo have painted an apocalyptic vision should the bill fail to be reauthorized. is that an accurate vision? and if so why not? >> i will don't think it's an accurate version, mr. chairman. for one thing, as i said in my testimony, less than 2% of u.s. exports are backed by ex-im and that doesn't consider the possibility that these exports would happen independently of the existence, absence the bank. more importantly, we have to think of what some of the other witnesses have said. so, for instance, a large part of the activity of the bank is to subsidize big companies. boeing in particular. and the loan guaranteed 66% of the activity of loan guaranteed through ex-im benefits boeing. well, boeing is selling planes to a company that could get

access to credit as we've heard without the loan guarantee. more importantly, boeing has a really important and wealthy financing arm, and it could do a lot of things. and it does. >> my time has expired. the chair now recognizes the ranking member. >> thank you very much, mr. chairman. i'd like to explain to those who are wondering why there are three individuals presenting who all seem to be opposed to the reauthorization. let me explain the rules. these three individuals were invited by the opposite side of the aisle. and we only get one witness. and that's mr. wilburn who's here. so i don't want you to think that somehow these were objectively chosen and that there are more people against reauthorization than for reauthorization. we just only get one witness to come here today.

having said that, i'd like to enter this letter into the record. this is a letter that our witness told us about where he lost a multimillion-dollar contract because of uncertainty regarding the future of ex-im. >> without objection. >> the letter reads, in view of the uncertainties of the reauthorization of the ex-im bank and project finance structure you propose have become problematic. we've made the decision in may this year not to proceed with your project offering. our previous partner developer has provided us assurance of the certainty of obtaining satisfactory finance from the export-import bank of korea for our bio gas waste to energy project. with previous discussions with you, we had the impression that your company firmgreen can provide the best technology for our project. but without terms similar to that being offered by the ex-im bank of korea, it would be impossible for our company to conclude a transaction. thank you for entering that. i have other letters i'd like to

read and share with you. this is from your district, mr. chairman. fritzpac corporation. during the past five years -- i'm reading an excerpt. during the past five years we've grown our international sales from 15% to over 35% of our business. we now have major trading partners in over 30 different countries including brazil, russia, india and taiwan. most recently, we exhibited our products at the balma international trade fair in munich, germany. in addition, our products were used in the construction of the sochi winter olympics in russia. so what is fitzpac corporation today? we're the american manufacturer of the best concrete mixtures in the world. we sell them as wide as canada, as far south as wellington, new zealand. we may be small, but we think big. in a place where we're thriving near the u.s. and it is in no

small part due to the services provided by ex-im bank. this is from your district. mr. gabriel ojeda who is the president. we have a letter from your district. i'll read an excerpt. as a small business that employs 265 people, 25% of these employees are supported by the ex-im bank. we use ex-im bank to create jobs in rural america. ex-im bank levels the playing field so that small businesses can grow. ex-im bank is a self-sustaining operation that has a solid history of making money for u.s. taxpayers. it has created millions of new jobs in the united states. reauthorization of the ex-im bank is a simple issue. ex-im creates and sustains jobs, strengthens the brand of american-made goods and reduces our deficit. if ex-im bank ceases to exist, the deficit would increase and we'll lose jobs in texas. you're going to hear a lot from

small business today. we have received a number of letters coming from all over america, many of them from small businesses talking about the importance of ex-im bank. jobs, jobs, jobs. as it was said earlier, we all talk about jobs. we've been through a recession. we almost went into a depression. we still have high unemployment in many areas and we're all saying to our constituents that we're going to do whatever we can to provide jobs. but when we look at how we lost our manufacturing base in this country and how ex-im is helping us to re-create and develop and sustain manufacturing which creates jobs, we say that that's what we want. but here we are, talking about not reauthorizing ex-im, which is responsible for these jobs and job creations. i submit to you these letters. i would ask my colleagues here on this side of the aisle, if

you have letters or information from your businesses in your district, now is the time to share them. and with that, mr. chairman, i won't use up all of the time that you allotted me. of course you used extra time. i just think the message is clear, jobs, jobs, jobs. i yield back the balance of my time. >> the chair now recognizes the gentleman from california, the chairman of the monetary policy subcommittee. >> thank you, mr. chairman. i sat in this very room however many years ago it was, three or four, whatever, when the ex-im bank was reauthorized for its current reauthorization. there were about six people sitting out there. the vast majority of the american people have never heard of the ex-im bank. this american had never heard of the ex-im bank before being elected to congress but yet, i doubt that the ex-im bank's footprint on the american

economy has grown or contracted since that time. but, yet, this room is full. and i understand there's an ante room that is also full. and it seems that the debate over this bank has become a proxy for a bunch of other things. but amongst the things that it's become a proxy for in my view is how we operate around here. and how we operate in this place. and it seems there are only two options that are being discussed. one is the complete elimination of the ex-im bank. and the other is the complete reauthorization of it as it is. but you know what, i think there's a third option. i think there's another way to do this. that doesn't involve complete elimination and doesn't involve assuming that the bank has nothing wrong with it and that it is absolutely perfect the way it is. some months ago i formed as the subcommittee chairman of the relevant subcommittee, i formed

a working group to work on reforms for the ex-im bank. regrettably, none of my friends on the other side of the aisle, that's my fault, not theirs, were in that working group. but amongst the republicans on our side of the aisle, we had a brought spectrum of republicans. it included people who were and probably are still opposed to the ex-im bank and its reauthorization. and others who came in favoring it. and we did develop a work product which until now i have not released to anyone. mr. chairman, i have a discussion draft. this is the work product of that working group which i would request be entered into the record. >> without objection. >> and for those of you out there, my -- this will be up on my website very soon. and i'll be issuing a press release on the same as well. now this is a discussion draft. it is in bill form.

it has about 20 different reforms to the ex-im bank. certainly i and i don't believe the members of the working group think this is the final answer or the only way or whatever. but it's an idea, and i believe an idea that we need to have, not only about this subject, but perhaps about other subjects as well. where we need to, rather than we're going to do this over here or this over here, that perhaps there's something that we can agree that there's some problems we need to fix. but maybe we can fix them. and maybe this thing can do what it was originally intended to do, what we would all like it to do which is support american jobs and american export and enable us to compete against all of those other export-import banks around the world. and do so in a more objective, a more -- just a better manner than it is right now. and in my last little bit of

time, mr. anderson, i heard you say that you felt the bank should be reformed. i didn't hear you say that it should be eliminated. is that correct? >> that's correct. and our position, by the way, the last time around when we were here, the reason there were only six people in the room, we've been working on this for five years because it's hurt us. and we got reforms, and they were ignored. so that's why our position the second time around is if it's not reformed, it needs to be abolished. because we got all the reforms. and they were totally ignored. i can read you the language. but it's -- the language was strong. and the bank has totally ignored it. >> okay. mr. anderson, and i don't know whether the reforms -- this working group, we didn't have you -- we didn't have boeing, we didn't have anybody in the room. it was just us working on what we felt was right. on what we felt was right. and we did something which we believe begins to address your

issue. doesn't necessarily eliminate your issue, but we believe it begins to address it. but that's what we tried to do. mr. wilburn, just picking someone on the other side of the issue. you're obviously supportive of the bank. do you have any objection to looking at things we can do to reduce the taxpayer risk but perhaps continue its mission? >> helping businesses compete whether small, large, on the global stage, i'm all for that. i'm a free market guy. basically, i agree with 95% of what's been said here today. so, i mean, i applaud the delta chairman and the other members for stating that they don't want to abolish the bank. >> thank you, i yield back. >> time of the gentleman has expired. the chair now recognizes the gentlelady from new york, miss maloney, marketing capital subcommittee. >> i thank the chairman and all the panelists and the ranking member. i believe we live in a very

inconvenient truth right now. especially in global capitalism. and as much as we would like to think that american businesses may not need any help, but what they're competing against is that total support in some cases, subsidy, in some cases, even owned by the foreign government. and if we were not, we would be unilaterally disarming in the international stage putting american jobs and exporters at risk. oftentimes, what we hear in congress is we're not exporting enough. why isn't america exporting enough? and our number one exporter is boeing. boeing exports a lot of planes. but they're competing against airbus that is subsidized, financed and even owned by a government. and a lot of the areas where we're exporting and competing, the subsidies from their

governments are far deeper and stronger than ours. and i fail to understand why we would in any way want to disrupt an agency that is helping export american goods, create american jobs and is not costing taxpayers any money. i think this is something that we should expand. i was at one export meeting where literally a company in new york was exporting clothing to china. i thought that was a great thing. why in the world why would i want to stop an agency that is helping them to do that? therefore, i would like and request to place in the record a document that's been signed by 835 businesses -- 865 organizations and businesses in america supporting the ex-im bank, including the chamber of commerce and also the national association of manufacturers. >> without objection.

>> i got to think that 865 organizations and businesses can't be wrong. i'll tell you. and i just want to ask, mr. wilburn, the opponents of the bank claim that trade finance should be left to the private sector. what has been your experience with finding commercial lenders willing to extend credit to foreign buyers who want to purchase your company's services? >> recently, i just obtained some private finance for my three works in progress in brazil. the problem is, that i had to pledge my house, my intellectual property, my inventory. everything i own. i'm a risk taker. i'm willing to do that. but i can only do that once. because once i pledge that collateral for those three, i can't take care of the next six,

seven that we're working on. and if there are those sources out there and the committee members know them, the chairman or anybody, or anybody hearing these words today, if you know these sources of private finance, please, get in contact with me and the other small business people that i know that would desperately like to have that as a solution. thank you. >> i have all these stack of letters from businesses in support of the ex-im bank. i'd also like to ask unanimous consent to put it in the record. and also one from labor. labor is supporting it on the basis this creates jobs in america. i ask unanimous consent to place this in the record. >> without objection. >> and in response to mr. anderson. i'm a big fan of delta. i fly it like once a week. i love the airline. >> thank you. >> i was pleased to support for

the -- vote for the support for the bailout by the federal government after september 11th. and i think we voted to transfer the pilots' pension obligations to the pension benefit corporation. so we provided that help. and that's a subsidy, i would say. and we needed to do that. i supported it. i voted for it. and i think also to this day, we have passed bills that restrict and prohibit foreign air carriers from competing with delta by flying routes within the united states. that we are trying in our own way to help the private sector compete and win in a world economy and provide the wonderful service that you do. but i, for one, am going to be writing boeing and ask them to write in their own words whether they think ex-im bank has been helpful to allow them to compete and win. and who are their competitors and compare how much they are

subsidized, if they are, to their foreign competitors in asia and europe. and also to ge and to every small company that is getting any help from the ex-im bank and all of our members should do the same. and let's create -- >> the time of the gentle lady has expired. the chair recognizes the gentleman from alabama, mr. baucus for five minutes. >> i thank the chairman. >> i would say to all members, mr. anderson, what he is saying is identical to what he and the airline pilots' association, and the union representatives were saying when we reauthorized this bill in may of 2012. and i met with the chairman in march. several members on both sides expressed the same concern that mr. anderson had.

and i was told at that time that they would sit down with delta. and i was also told that boeing would take a look at it. we then put in the language of the reauthorization directing the treasury secretary to initiate and pursue multilateral negotiations for reducing and eliminating government export subsidies for aircraft. we specifically told them that we were concerned about wide body aircraft. two companies that were -- had government-owned subsidies. rich companies as mr. anderson said. and everybody expressed a great sensitivity to this. and we documented losses by american air carriers on overseas routes. and that's what we're talking

about. we're not talking about routes within the united states. that's got nothing to do with this. our american airlines used to lead the world in these overseas routes. from the time that we reauthorized this with -- really, i say it's strong language, but it turned out it wasn't that strong. because it didn't forbid the sale. and i can tell you that they're going to -- as long as we don't forbid them, they're going to have them. because when mr. hochberg met with my office, and later when he testifies i'm going to show you my letter to him and his response which was a nonresponse. we've always got those. members also expressed to me some great concern on the australian loan.

but there were members on both sides. i wrote chairman hochberg about that on behalf of several members on august the 2nd. we then inquired about the status of our letter, and we were told they were going to respond. december the 20th, i woke up to read in "the wall street journal" that the loan had been approved. after my august letter. no response. finally, on february the 19th, my office, two months after the loan was approved and announced, an iron ore industry, the miners, all sorts of union groups expressing concern, he wrote me back and said we

approved it. in my letter i asked him to get with us and we wanted -- there was no detailed analysis of the financing request and how it would affect u.s. jobs. and i asked him to share that information with me. even -- i know mr. hochberg is here, i look forward to some explanation, but no one from ex-im gave us any of this information. they didn't even give it to us. just said if i have questions he gave me the number of -- his number. he said i could call him collect. this is a loan that's already been made. we -- you know, i had what i considered a commitment from ex-im bank and so did mr. anderson. on a directed prohibition that

was costing probably 10,000 u.s. jobs. these jobs have been being eliminated since 1978 when they started doing this. their estimates that this one mine produces more iron ore than our entire u.s. production. and it shut down iron ore production in this country as a result. a lot of it. but we -- a lot of promise to reauthorize -- and even the treasury department which i asked -- i asked them what are we going to do -- they basically told us, what are you going to do, are you negotiating? basically just blew us off. the staff. thank you, mr. chairman. >> the time has expired. the chair now recognizes the gentleman from california,

mr. sherman. >> ranking member notes that only mr. wilburn is outnumbered 3-1, but i'll point out his arguments are three times as good. therefore, i think it's fair. it's been noted that ex-im bank is financing the sale of airplanes to airlines that could get credit from somewhere else. that is entirely true. every one of those airlines could get credit from the export credit agencies of germany and france. there's only one catch, they'd have to buy an airbus. so the question here is not whether the buyer could make the purchase. the question here is whether the buyer will purchase the u.s.-made product. and we're told that only 2% of american exports are at stake here. america is running the largest trade deficit in the history of the world. we can't afford to give up 2% of

our exports. we can't afford to give up half a percent of our exports. we're told there's a scandal involving some officers of ex-im bank. there's also been a scandal involving officers of the united states navy, dealing with the repair of ships in the pacific. yet, no one is proposing that we de-authorize the united states navy. i look forward to working with the chairman, perhaps the gentleman from california, to improve ex-im because i don't think that everything is perfect and none of these criticisms deserve any attention. one of those reforms would be to have language and even more clear language, to say that they can't make a loan or guarantee a loan without looking at the total effect on u.s. jobs. one particular area is airplanes. we're supposed to have an ex-im bank to finance exports. if you're talking about a power

plant being built in india, the turbine is an export. if the turbine is in indiana, it's not an export. it doesn't matter whether the company that owns the plant is in the united states or india. planes are different. they fly. and whether a plane has been exported or not, doesn't, shouldn't depend upon the headquarters' building of the buyer. it should depend on where the airplane will be used. there are two approaches we could take. one is to allow u.s. airlines to consider an export and, therefore, get ex-im financing on a plane they are going to use international routes in competition with foreign airlines that are also eligible for ex-im financing should they buy american planes. the second approach is to deny ex-im financing to those foreign airlines when they're buying a plane that's going to be used to fly to and from the united states. but these are things to explore. to throw out 2% of our total

exports because of one issue, affecting flights to asia and the middle east, i think would be a mistake. now, mr. anderson, you have financial statements that you send to shareholders. and maybe you've got really a choice. you could use gaap accounting, generally accepted accounting principles. or some have suggested fairy tale accounting. when you produce a p & l statement, do you report the interest expense you have or do you instead report the interest expense you would have had if you lived in a fair world? when i read your income statement, do i see as interest expense what you're actually going to pay your lenders or some notion of

fairnesses too what you would be paying if only the world were fair? it's an easy question. >> no, it's not. generally accepted accounting principles have various methods for how you account -- >> do any of them involve you reporting, as your interest expense, what the interest expense would be in a fair world? >> yes. in some -- in some instance, in the case of a merger, where you have to go back and fresh start an account. >> okay. in some limited -- you just had a merger. >> no, we have a lot of interest expense on our balance sheet that is not the actual interest we pay. because the generally accepted accounting principles require you to market to market. >> that may be. but you don't do it and say, in a fair world, interest rates would be the same for you as they are for the emirates? you don't say pizza hut should report the same interest cost as

the local pizzeria or the pizzeria reports the same costs as pizza hut. you report -- you just had a merger, or at least you have experience with it. in the ordinary case, and without a merger. i don't think they'll do a merger with its german competitor. you report interest expense based on the deal you negotiated not based on an imaginary and fair world. >> look, i'm not trying to obfuscate. in some instances you do. in some instances you have to come to a fair accounting standard. i wish it were that simple. >> none of those reflect a really fair world. >> the time of the gentleman has expired. the chair recognizes the gentlelady from west virginia. >> thank you, mr. chairman. mr. anderson, how many employees does delta airlines have in the united states? >> we have about 78,000 employees in the united states. and probably 250,000 retirees. >> is that up or down or pretty steady?

>> actually, we're hiring quite a bit right now. so we are hiring about 600 pilots a year and over 1,000 flight attendants so we're growing our employment without any government aid, by the way. >> you made a mention in your comments that with the ex-im bank's behavior in financing wide bodies around the world, you kind of quantified it as to maybe 1,000 jobs it might have cost you. could you expand on that a little bit? >> well, that was in specific instance to air india. when i hear the arms battle -- what the ex-im is doing is putting our employees in the cross fire. because it's u.s. airline jobs that are lost when heavily subsidized foreign-owned airlines are able to also get a subsidy from our treasury. and it has reduced the growth of

our company. this is the first year it will actually have any real growth in the last five. and we see it in the marketplace by the entry of carriers with ex-im bank finance, below market financing. >> so the argument to either relook and reshape like mr. campbell is saying or deauthorize, it is a jobs -- it is a jobs. it's small business jobs, but it's businesses that have 75,000 employees at the same time? >> exactly. and the point is, i don't understand why we don't have the same view about jobs that are hurt by the bank as we do about small business jobs. these are all really important jobs. in the small business part of what ex-im does is actually really small and it's pretty new to the bank. because after the last reauthorization fight, the bank went into a really aggressive marketing mode to small business so that it would have

constituents in every congressional district. let's set that aside. the real issue is 90% of this goes to the top ten biggest companies in the united states that are well-funded and well-capitalized. and that's what we're focused on. >> thank you, mr. wilburn. i'm over here. i don't know if you remember in my opening comments, i commented about the administration of the ex-im bank's policy of not funding coal-fired power facilities and clean coal technologies, except in developing companies. you are a green energy company developer. and i love green energy jobs. we love our coal jobs. they're just as important to us as a green energy job is to you. do you think, in thinking about this, that it is a proper place for an entity such as the ex-im bank to say to american employers and american workers

that because we have a certain environmental belief that we should disenfranchise one american job over, say, one of the jobs in your company as a green energy company? don't you think those jobs should be treated equally if we're going to be looking at financing exporting across the globe? >> let me respond that basically i'm very supportive of technologies that are good for the environment. and i think the coal industry, particularly my family, has a background in that and we're affected by it. i think the point here is, though, that the bank is looking at the environmental policy. okay? and i'm not an expert on it. i serve on the advisory committee of the export bank on the environmental and renewable energy committee. and what i try to advise them of is to be cautious when we're taking a look at the environmental impact. make sure they have the data. make sure that they have the

studies and the reports. don't just make arbitrary decisions. and i think for the most part, they have been listening to me but i understand your argument. and all i can say is that i want an environmentally sound policy by ex-im bank that creates and protects american jobs. >> thank you. thank you. i would say i looked at the your list of vendors. you're in around around the state of west virginia, you just need to slip over the border. >> give me the names of businesses. i'll be happy to talk. >> thank you very much. >> the chair recognizes the ranking member of the financial institutions subcommittee for five minutes. >> thank you, mr. chairman, and thank the ranking member. let me first -- first, i want to say thank you to mr. anderson. you know, delta airlines is one of the largest employers in our district, and we really appreciate what you've been doing at jfk airport and the

expansion there and the folks that you've been putting on. so we want to thank you for that. as a result i made sure that i was reading your testimony very, very carefully, because we do want to create jobs. and i think that's tremendously important. but in looking at it, i just wanted to double-check. because i'd just like to ask, first, outright, and i'll start -- i think i know where mr. wilburn is in reference to the reauthorization of ex-im. but i just was wondering, captain moak, do you think that we should do away with ex-im, or should ex-im be reauthorized? i just want to know yes or no? what do you think about ex-im? >> first, i want to thank the congressman. i fly out of kennedy. you do an incredible job out there. flying a boeing airplane 767.

great airplane. i want to thank you for what you've done and we have thousands of members up there. the ex-im bank needs to reformed because we have lost jobs at john f. kennedy airport because of actions of the ex-im bank. it needs to be reformed, period. >> so do you think it would be okay if ex-im was not reauthorized and all of the jobs created by ex-im. i know we've got to figure this out. one of the things that concerns me, i am the largest -- one of the largest supporters of trade. and the reason why i support trade is because i want to export our goods to other places. and then when i hear an example, for example, trying to level the playing field. there's an example i know took place in 2011, for example. where brazil had the largest land line telephone company and reportedly chose to purchase network equipment with chinese technologies because of access to china's development banks, 30 billion credit line which came with a two-year grace period on

payments and an interest rate of 2 percentage point bess low the market rate. that's just one example i can give on how chin has used its banks to win new exports. that's our competition. and there are hundreds of other examples of which i could give from all over the world. and my concern is, and to all of you, wouldn't you agree that several industries that export jobs throughout which would devastate america. and i wish i could just say i'm just focused on jfk. i've got to think bigger than jfk. i've got to think as a member of the united states congress that i represent my district, but first, the overall benefit. and sometimes, you got to figure out on a balance, wouldn't we be really jeopardizing export jobs without ex-im bank? >> sir, just to follow, you know, we're here because we need your help to level the playing field.

right now, we're not able to compete, and we're losing jobs out of kennedy, so we need leadership to reform the bank. the bank hasn't followed the will of the congress. >> what i'm getting at is this, and as i said, mr. anderson, you -- i go to you also. see, because what i have to weigh here, you know, is the overwhelming balance of companies that come to me because i'm a pro trader that say this is absolutely important to them. if i would show you the number of companies that have come to me and the jobs they represent because it would be absolutely devastating to them compared to one company who i like who have done, i'll have to say good, but then compared to one company, you know, then i've got a decision to make as a member of congress. especially me, because i've got to defend my own record of wanting to export things all over the world and making it

easier so we can compete. and when i look at, for example, that i know that there's other ecas, almost upwards of 60 ecas -- export credit agencies -- that exist in all of the other foreign countries. many of whom do not even comply with international export credit standards established. such countries like china and brazil and india offer below market and concessionary alternatives. wouldn't you agree that's what we have to look at so we can level those playing fields? if we don't level those, then we are putting at risk hundreds of thousands of american jobs because we cannot export to these other countries because there's no level playing field there. i see i'm out of time. >> time has expired. the chair recognizes the gentleman from new jersey, mr. garrett. chairman of the capital markets subcommittee. >> and i thank the chairman. there's a number of areas that

we can talk about here. i think the gentlelady to the right of me may go into this in more detail. but just as a beginning, i'll just do the highlight. and that is the fact although there's a statement from the other side of the aisle saying that ex-im has never lost money, i think we have some documents to show that has not been the case over its somewhat sordid history of mismanagement, severe losses and past history of having to have been bailed out and recapitalize in the past. i'll let the gentlelady address that issue later. secondly, to a technical point, as to accounting, gaap accounting under fasb rules, i think it's 157. we've been in other hearings before. fair value accounting, right? that's part of it, parse and parcel of your process, isn't it? >> absolutely. i think most americans would love to have the government's

accounting system. >> exactly. the next point is on reform. maybe i'll throw it it back to mr. anderson and anybody else. the captain as well. the idea is maybe we can just reform this. but as some of you indicated before, we've been down this road before, we reformed it before. passed legislation just a few years ago. we instructed treasury to do something and we instructed ex-im to do something. we tried to have ex-im do cost benefit analysis. neither of those things were completed, correct? you're nodding -- >> you were totally ignored. >> so the question i have before i think about re-re-reforming something, if we do that, you don't have to answer this, i'm wondering why i will not anticipate being here two or three years from now after this re-reform has been ignored again? >> that's why we thought this problem was fixed last time.

and then we worked over the course of the last two years to try to get the reforms that both sides of the aisle agreed to enacted. braynard told me they were not going to interact with the subsidies right across the table in the treasury department. >> in the meantime while we wait for the re-reform to be implemented and find out it's not going to be implemented, how many jobs will we lose in the interim? >> we're going to lose thousands. that's why our position now has changed. last time, we thought we had it fixed. now our position is if there's not a hard stop on wide-body financing for state-owned credit worthy airlines, it should be ended. >> i appreciate that, our small business guy mr. wilburn, what you're doing. i appreciate your service as well as your entrepreneurial spirit. i just have one bone to pick

with you. i know you say you're a free market-type of guy. i think you said i pledged my collateral, you can only pledge that once. and i get that. but i guesses that's the way the free markets work. if i have an idea or product or business and i have capital, i can only pledge it once. and i guess the industry in front of us, they can only pledge it. that's the rule whether you are a big guy or a little guy. you can only pledge it once. even though i've got lots of great business ideas. just doesn't seem like anyone wants to invest in them. just because you have a great business idea and great business model doesn't mean that you can look to somebody else to finance it. you can try to seek somebody else to finance it, and that's what you're trying to do. and it's great that you're on tv maybe today so people will help you out there. but -- >> with all due respect -- >> well, my point is, we should not be asking the american public to step in and be the one to be the one to ultimately finance, once any business, big

or small, pledges their collateral once. independent investors should be the one who are responsible for doing that. we should not ask the taxpayer to step in. and i'll close then with dr. de rugy -- sorry. can you quantify, any of what we're talking about here? mr. anderson's tried to, as far as without a cross-benefit analysis being done like ex-im should have done, what we're really looking at when we continue down this road or path of picking winners and losers in this current system that we have as far as job losses. do you want to talk on that? >> well, it's very hard to know exactly how many jobs are lost. one of the things which we know is who the beneficiary are. and we also know that the ex-im bank picked winners and losers. and that is very different from the free market. and also we have 200 years of economic literatures that

explains that free market is the way to go. and protectionism is then because it hurts consumers by raising prices. and with the ex-im bank it is not free market -- the time of the gentleman has expired. irges mr. chairman i would request unanimous consent for mr. willburn to have an opportunity to respond to the teaches he just received from mr. garrett on oil and gas subsidies that he mentioned. in response to mr. garrett's claim that the government should not be subsidizing -- >> i'm sure there are many members on your side of the aisle that would be happy to yield more time to mr. wilburn, the chair now represents the member from massachusetts, the rank, mr. capuano for five minutes. >> thank mr. chairman, and thank the panel for being here.

i want to thank you for your common-sense approach i regret that approach. >> i think you race interesting and very good points on a similar issue, just in massachusetts, using taxpayer dollars to help encourage -- i am more than happy to look at this if every country in the world would legitimately want to shut down their xm bank or comparable, i would consider it. i don't disagree, this should be unnecessary, but i don't live in that world. i live in the real world of fair competition. when france has 4600 people working for their xm bank and we have 400, if we want to compete, we need to do this.

with that i would like to yield the rest of my time. mr. wild burn, as hi employees, kind of one day at a time, one contract at a time. whether or not you would be surprised that the company to your right which has claimed such material damage and is represented by its own spokespeople is now the most profitable airline in the united states and arguably the world, indeed made $2.7 billion in profit last year, which i'm grateful for. that's a good thing. i'm not asking the question of

you, mr. anderson. would it surprise you the company has paid no federal income taxes and is projected not -- mr. chairman, it's my time, not mr. anderson's. would it surprise you, mr. wi lichtburn? >> i don't know if i'm surprised. i can't characterize it as surprised. it's new information to me i was not aware of. >> mr. wilburn, i'm wondering if you would consider what the gentleman to your right has repeatedly said. i want to interject here my gratitude for living in a nation that builds the greatest airplanes in the world flown by the most competent pilots. i did 150,000 miles last year, and i didn't lose a wink of sleep for my personal safety, and i thank you all for that

quite genuinely, but mr. wilburn, the gentleman to your right said in his opening testimony, i don't believe in subsidies. would you consider it a subsidy that the federal government through its pension benefit guaranty corporation took over the pension liabilities of delta at the point of which the capital been collects his, will be provided by the taxpayers of the united states? would you consider that a subsidy? >> again, with all due respect, i don't think i'm qualified to answer that, but i understand your point. subsidies exist in a variety of different ways, and i'm faced with that unlevel playing field every day. i would have to have more information on that, but you have piqued my interest. >> so lastly, then. i'm wondering whether or not you would consider it at least inconsistent that the company has argued that the existence of

the export/import bank to lone monies to their competitors, would you consider it inconsistent that they have that view when in fact that company borrowed from the canadian export authority to what i deem as short-hop airplanes? >> again, i'm not familiar with those facts and i'm learning a lot of things today in real time. as a small business guy, i'm more focus odd my issues, but i can tell you this there are a number of issues raised today that lead us to a broader discussion. the broader discussion is, what role does the xm bank really play. i can tell you just from my perspective. without the export/xwokt bank people will buy in the philippines, not my goods, but korean goods, because it's financed by the korean

import/export bank, so i think we need to get to their reasonable position, do some reforming, but save the import/export bank of the united states. >> the chair recognizes the gentleman from texas. >> thank you, mr. chairman. mr. anderson, i detected you might want to popped to some of the questions raised a while ago? >> let me start by sag boeing got a refund, didn't pay any taxes, but delta accrues its taxes at the full federal tax rate. we don't have any offshore subsidiaries. the reason why we are not a cash taxpayer is because we went through a very painful bankruptcy and restructured our company county any subsidies from the government el on. we paid or premiums into the pension benefit guaranty corporation, and unfortunately for our pilots, we had to terminate their pension plan. so captain lee moke, i would correct the record, doesn't have

a pension, because his pension was terminated. we were able with the help of this committee to pass the pension protection act in 2006 and save the pensions by getting an amendment to the law so that delta can pay out over a billion of pensions to our retires today. and we're overfunding those pensions. so you hit a raw nerve when you look back at these people who went through a really tough restructuring, and we're a full -- we're a full taxpayer in this country, and these people boar the brunt of a tough bankruptcy, and a lot of them lost their pensions. >> thank you. i want to expand on something that's been brought up, i don't think people realize that -- i was shocked to learn that 14 of the largest 20 state-owned or state-supported airlines received xm funding. so just to put that in

perspective, these countries that, many of them who have fairly substantial sovereign wealth funds, are able to get financing backed by the u.s. taxpayers to compete with u.s. companies. it's not just -- you mentioned, mr. anderson, i think a couple india, emirates, china, a long list. there was a long list of airlines that they are subsidizing to compete with your airline. and that puts you at a disadvantage. >> that's exactly right. i mean, the prime examples would be singapore airlines, which is owned by tamasik, the largest sovereign fund in the world. our government finances the airplanes. 9 largest oil-owning company in the world is abu dhabi. it has the largest oil reserves in the world, and it owns and

operates a government airline, and we, our treasury, finances their airlines well below market to fly into our markets. >> one of the things you mentioned in your testimony, too, you said you did not support the reauthorization, because you felt like you got double-crossed on the last reauthorization, but you would support possibly a reauthorization that had some reforms. do you want to elaborate a little bit on that? >> absolutely. our position has been consistent. it was consistent at the last reauthorization. language was put in the bills to fix these issues that hurt american jobs, and it was ignored. so we've taken a harder line position this time, along with all the employees i have here, and the 3,000 employees we have in seattle, washington, to require that there be real reform this time.

i respect small businesses, i want all small businesses to be successful. this isn't about small business. this is about 90%, 95% of the money this bank uses for the top ten -- this is about putting safeguards in place so you, as member -- not picking and choosing which companies win and which companies lose. i think they're just as important. if not, i would invite any congressman here to tell my employees that their jobs are not as important. >> thank you. >> mr. wilburns, has your firm ever received any federal grands, loans guarantees?

>> no, sir. >> okay. thank you. doctor, if -- you've done some analysis on xm and their financing and their structure. i see my time is out, so i submit. >> the chair now recognizes gentleman from missouri. >> sure, financing is available from u.s. businesses, in cases where the private sector is unable or unwilling to i understand that these deals are often untenable for commercial

banks. is it appropriate for the government to help finance such deals? >> i don't think the government should be in the capital market business, because the way government allocates money is based on politics, not on sound economics. more importantly, you have to understand that when the capital market does not allocate funds to someone because they are cash poor, it's a feature of the capital market, not a bug. and it's unfair for congress to demand that taxpayers be the one footing the bill, because some people want to borrow money and -- are not able to find lenders to lend them that money, because they don't think it's a worthy or a safe bet enough. >> doctor. isn't it true that congress picks winners and losers every year, star through our tax code? >> i agree. >> and so -- >> and i'm against that, too.

>> you're against that, too? >> i'm against the government picking winners and losers. i think the general rule should apply. >> and you've lobbied your members of congress on that, i assume? >> i don't lobby, i write research papers. >> at least you've talked to them? >> i'm not -- i specialize mostly on the budget, but when you've talked about tax reforms, i'm talked about leveling the playing field. i don't believe in giving tax credit to some companies, or to taxpayers based on the fact that they're buys a house rather than renting. i believe in the general rule. i believe in a flat tax, for instance, rather than the system that we have today. yes, i am against the government picking winners and losers across the board, whether it's through taxes or whether it's through government funding, whether it's through loan guarantee. >> thank you. mr. anderson, a review of u.s.

airline purchases by u.s. carriers between 2012 and 2014 reveals that all of the recent capital market deals have been on more affordable terms that would have been available if the carriers had used the export credit as made available to foreign purchasers of u.s. aircraft. given this, how do you defend the claim that the u.s. is providing -- >> this is a competitive business. defense on what your interest rates are, your interest rates are determined by the capital structure. when the government gets involved and takes that market component out, we're no longer competing at who is the best just because we have lower interest rates means we pay our debts better.

if a competitor gets lower rates for an artificial reason, they're getting a subsidy. >> you don't think francis or england uses their ability to level the plays field for their airline makers? no, because there's an oral understanding between boeing and airbus that creates something called the home market rule. so the united states, britain, germany, francis and spain do not use and are not allowed to use export credit. >> okay. thank you. i'm going to yield the remained are of my time to the gentleman from missouri.

>> thank you, some of your points i think are good. >> what would you see to the. what do i say to them when i say the xm bank is closed? >> i think we should put our employees and your employees and say we're going to preserve and grow both those jobs. and that's the reform that needs to take place. >> thank you, mr. anderson, again for being here, and bringing the crowd with you.

i guess to put it in simple terms, if a european government subsidized airline buys a plane from boeing, and you buy a plane from beaus, you compete with them on some of the same routes. is that not true if. >> on a global network, you com peep in some form or fashion over the hub system. >> if you were buying 60 planes in boeing, is that not correct? >> right now we have about 100 airplanes from boeing. >> even though you said you're paying cash, if unfortunate some of the financing options that some of your competitors had, you may even buy more planes from boeing and give boeing more

work to do. is that true? >> i am not in favor of opening up export financing for u.s. carriers, but i don't think that's a free market. >> thank you. >> coupe tell me why it's misleading for the import/export bank to claim that 90% of the loans go to small businesses? >> the number is correct if you only -- >> i'm sorry, i'm not sure if your microphone is on. >> okay. >> it's a little less than 90%, but with you look at the number of transactions, but when you look at the money, what you see is roughly 19% of the money goes to small businesses, that's less

than even the bank's charters asks, and they have a very -- about mom and pops, stores, or 10, 15 companies. can go to a company -- these are big businesses in my book, but what it means is over 80% of the money goes to a very big company. we know that they go to leading manufacturers, the u.s. number one u.s. exporter, boeing, is obviously leading the pack. >> thank you. >> you know airlines, if up an apples to apple, airline

manufactures sees and we're getting impacted twice. what happens, since we don't have the ability to access that, along with a few other companies that manufacture airplanes, cunning like the middle eastern countries not only are they using xm bank financing and putting them on routes, they're also using european credit -- airbus airports, overlaying our routes at a number like $3 million, so we start out the beginning of the year. it's hard to catch up. we had to pell out of markets. we're getting his by eca practices, and that's why we came before this group to ask them to negotiate taking that down, because the middle eastern countries are taking advantage

of it. >> so would it be true when you other side of the aisle says labor is for the rethor sax of the xm bank, that would not be entirely true? >> labor is for reform, fair practices, competing in the world. we have the best workers in the world. we need to be given the opportunity to compete. when we have a fair opportunity to compete, we win. we're coming to this place, because government policy matters. we need your help, or we wouldn't be here. >> just one last thing, you had made an attempt at the last wee thor saz to do the right thing. you're back here today, because it doesn't work and they did not do the things that were promised. is that not true? >> correct. >> the time of the gentleman has expired. now recognizing ms. mccarthy

for five minutes. >> thank you, mr. chairman. i appreciate the opportunity. we certainly support the unions and the airlines. i think what i would look to mr. anderson on one quick question, are there any other american airlines experiencing the same problems that you are? >> yes. >> 31 different properties i represent, all the major u.s. airlines. the swer to that is absolutely yet, we're getting hit by this. we need reform. >> we did negotiate two years ago, which we thought was a fair agreement. so here we are at this point. what do you think would be a fair agreement? where would you want to change

the language? is it only enforcing xm bank? is it something different? >> it needs to be mandatory. >> the language that was prefatory last time needs to be made mandatory. >> we've tried to be targeted to try to go at the very issues that hurt our employment, and the issue that hurts is our government further subsidizing deeply subsidized foreign airlines. >> i doubt very much you would ever again lang what people here don't like to use the word mandatory. if we don't get the language in as mandatory, and you're basically saying that we should,

you know, abolish the bank, then to be very honest, you're a union, all the other unions will have a problem. a lot of my constituents will have a problem. so we have to come up with a solution. with that being said, too, i know that you are probably the most profitable airline, that's great. we want to see that, and i know you had your ups and downs walsh going through the bankruptcy more of what was going on through the world that year as far as oil prices and everything else like that, and you had to reconstruct? >> the terrible tragedy of 9/11 ubs and i sand in one of these rooms representing the industry, so we lived through that, and it definite a devastating blow.

our capacity fell off 27%, so i would have to say between very high oil prices and the 9/11 tragedy, sand then the aftermath of that wreaked havoc on our industry. >> i'm only trying to bring out that unfortunately, whether small businesses or large corporations, we really want to support them, because that is jobs, but sometimes we, even the government can't do everything, and we could. i want to also say that someone also supporting my unions, i would like to insert into the record, mr. chairman, from four other labor unions. >> without objection. >> thank you. >> i think trying to find that

common ground, which is really different. i hope we can come to an understanding that i do believe in the export bank. i do believe it helps an awful lot of our people in this country. i do believe it brings good jobs and keeps good jobs here in this country, about that being said, i want to turn over the rest of my time to my colleague. you wanted extra time? >> are you pointing at me? >> yes, i am. >> sure. thank you very much. mr. chair, i would seek unanimous consent to enter into the record verified excerpts of a speech given by former vice president mr. cheney? >> without objection units with your -- there are those who say the bank is some form of corporate welfare. they obviously don't know for every dollar proceeded in the last five years xm has returned

approximately $20 worth of export. that's the kind of successful government program that even a fiscal conservative such as me can embrace. thank you, mr. chair. >> the chair now recognizes the gentleman from new york, mr. king. >> thank you, mr. chairman and thank all the witnesses. >> just got my flight confirmed for tomorrow on delta, so thank you for that. doctor, besides your testimony, thank you for the work you've done in homeland security over the years. i've sometimes plagiarized some of your words without giving you credit, so let me do that now. >> thank you. and i've had a very good relationship with the pilots, and mr. wilburn, i do believe you represent an american success story. with all of that trying to find a way if we can be on the same

pages mr. anderson, you believe reform is necessary. i believe we have to find a way to reauthorize the bank. i know chronnyism may happen in some cases, but certainly the businesses in my district are small businesses, we have a musical instrument string manufacturer, a woodworking tool manufacturer. sew probably within adjacent four or five districts there are hundreds of employees that work in businesses in adjacent districts, so it is important. i also voted every free trade agreement that's come before congress since i've been here in 22 years. i believe in free trade.

i also know that countries such as germany, france. china, brazil, india and korea to me that is not a 4re68 plays field. >> if we just i believe we are given an advance to our foreign -- douglas -- if i can use the partisan term, a rep xhunt. i would love to live in a word that does not have a need, one more international transactions done on a level plays field. they are all out there trying to game market shares jim norso, a

former congressman, he ended up being the director of omb, he said export/import is self-funding and generated income for the treasury since 1992. i bring them out not to make the appeal to authority -- who supposedly is on the other side and sounds good, but i feel what mr. campbell said, i don't see how we end or -- i don't know if we shouldens it, but obviously reforms are necessary. obviously that has to be changed, but on the other hand, i think the blow to our economy by sundayly -- and also larger businesses at risk is a -- especially at this time, when we still have not fully recovered from the crash of 2008, at a time when there is the increased

burdens of obama care, epa, regulations, of burdens, that it's just not appropriate and is not the responsible thing to do to end our -- to end the authorization of export/import. at the same time i believe reforms are necessary. if a way can be found before the expiration dates to bring that about, i would strongly support that and work with that. i think the chairman has raise the important issues, but i think we go too far if we say we're going to end it. there's always some government involved in the, bankruptcy is government involvement. i support that fully, but that is the government helping businesses get back together. proposes are given to labor unions. we have veld ran, senior citizens, everyone with some involvement. i think we would be going too far if we do not reauthorize

export/import. if nothing else, you have certainly forced congress to pay more attention to you now. >> mr. lynch? >> thank you, mr. chairman. thank you for the witnesses for coming forward to help us with our work. i've been involved on the oversight committee and this committee on dealing with some of our trade agreements, and just trying to rebalance our export/import imbalance with a number of countries, spent some time recently in south korea, india, france, germany. i noticed in my trip to south korea, in connection with the south korean trade agreement, i

couldn't help but notice, the only u.s. cars -- now, south korea is a booming economy, very modern, big highways. the only u.s. cars i saw there on the days that i was there was the one i was riding in and the one that had my security detail from the embassy. so no u.s. cars. in japan, same thing. you needed a detective to find an american car. so obviously those companies have closed markets in order to boost their domestic car production. i walk outside this door here, i can't spit without hitting a japanese or a korean car.

so they have highly protective efforts. and as mr. king pointed out recently, they are pumping in about seven times what we are doing in terms of credit assistance through their versions of their xm banks. in addition, in my state of massachusetts, the french government just kale in and took over one of you're commuter rail systems. they backed one of their companies, al stom. france wants to become the world's rail company. they want to manufacture the rails, go out into other countries and dominate those markets, kind of what boeing is trying to do in the aircraft have i on behalf of american machinists and american workers.

it's become a globalized strategy, and they are there to push their workers. and i understand the theoretical arguments i am hearing today about, it would be nice -- we want a level playing field. well, the playing field will become much less level if we exit the battlefield, which is what you are suggesting that we do right now. i wish -- i wish that our exit from the xm bank -- listen, we're not talking about reforming the export/import bank yet. it's going away. it's going away. so it's going to increase the imbalance here, but it will tip it in favor, drastically in favor of foreign competition.

we are opening up our markets, we are walking off the battlefield. we will no longer try to protect our workers in this iteration the way we have been doing -- and it hasn't been smooth. it hasn't been fair to smaller businesses, i agree to that. but we are protecting a whole boatload of workers right here, but the reality i am dealing with, is if you sections, if the xmt m bank goes away, and it looks likely that will happen, because no other nation is going to disarm, we're going to be at a huge disadvantage, and foreign manufacturers will be handed a huge advantage. i think it will be a good day for airbus. you'll see their stock go right up. it will be a great day for them. but at the end of the day, when the xm bank goes away, government will still be picking winners and losers. it just won't be the u.s.

government. and the governments that are picking the winners and losers will be the foreign governments, and those winners, you've got to be kidding me if you don't believe those foreign governments will pick their own companies, their own workers, you see what japan, south korea, india, all these other countries. it's a nice theoretical argument you have here, about you when this goes away, it will be a bad day for america, a bad day for the american workers. >> the time for the gentleman has expired. >> thank you. doctor, i think i have been informed that you have asked to be excused from the panel at this time. you have a prior commitment. is this correct? >> yes, i have a plane >> in that case, members who -- i won't ask which plane, and i won't even ask which airline, but members will have five legislative days to submit questions to the doctor.

we would ask that you respond as quickly as possible. >> can i add just one thing? >> not substantively. processwise, yes, substantively no, in which case we will excuse you at this time. the chair now recognizes the gentle lady from minnesota, mr. bachmann for five minutes. >> thank you, mr. chair. if the doctor would like to make her comment, i would be more than happy -- if you'd like to make your comment that you wanted to make, make your comment during the course of my time. >> thank you. based on the discussion i think it's important to remember the basic itself only justified 30% of the activity on the need to contravail foreign -- so the idea that it does is to compete with foreign governments is not accurate on the data itself. i will say that we're talking

about jobs, we are talking a lot about businesses, but forgetting consumers. protectionism, which is what the xm bank is doing, hurts consumers in the form of higher prices, and economists care about producers and consumers, too. i think we have many years of economic studies that show that basically protectionism tends to benefit even for the beneficiary of the protectionism, does not outweigh the costs to all the unseen victims. >> thank you so much. that goes to my point. a lot of what i've heard here today is we need to continue to provide subsidies and stay on the subsidy train, because the rest of the world is on the subsidy train. and to continue that logic means that nations of the world have to continue one upsmanship on subsidy. and it's a complete rejection of the free market. i don't think that's the direction we want to go. the free market has built up the

most magnificent economies of this world. i remain a defender of the free economy. one of our former presidents said that nothing is more representative of eternal life than a government program. i think we heard the defenders today here of this program despite them as management, despite the failures. we have an executive summary some front of me that says, as a matter of fact that export will xwokt are import bank as a loss from every year to 1982 to 1995. and reform was passed -- when reform was passed, the fcra, that meant then that the losses were back-filled by the taxpayer, and xm bank received $9.92 billion in direct proepz from the government from '92 and '96. when we talk about free

economies, the united states used to be considered under the category of a free xhi. we are not the freest, we're not the fifth freest economy, not even the tenth freest economy in the world. we have actually fallen out of the status called free economy. we've now dropped out of the top ten. we're considered a mostly free economy. and while the fault isn't at the foot of the xm bank i. it's death by 1,000 cuts. this is just one example. i think congress needs to look at itself in the mirror and to see what we have done to contribute to a less free economy. i think there are four areas. one is -- look at the tax code in the united states. we have the highest corporate tax rate in the world, bar none, 35%. then you add onto that the obama new tax rate, the 3.8%, rare injures state corporate tax

rates, and you see how uncompetitive the united states is. we need massive tax reform. the next factor -- regulatory burden. dodd/frank, obamacare, the new epa rules, we have heaped upon american businesses the uncompetitive factor of a tax rate you might say through increased regulatory burden. that's number two. number three is the united states government has exceeded growth beyond the taxpayers' ability to pay for government services. we are growing the cost of government. number four, the lack of some money. we have seen through what the federal reserve is doing the increased inefficiency with sound money. those four reasons aren't your fall. those are the fault of the united states congress and this government. we are the ones who need to look in the mirror how we have made

this a less free economy. regarding the export/import bank and four firings that just occurred, that also doesn't include the 74 cases since april of 2009 when bank officials were forced to act on the basis of integrity investigations by the office of inspector general. there are dozens of other fraud cases involved in the xm beneficiaries that have now been referred to the department of justice for prosecution. i sigh my time is gone, but i will enter into the record several recent stories about the fraud that's going on. >> without objection. >> i want to stand on record u. i oppose the continuation of this bank, because reform hasn't worked. we have been ignored. >> the chair now recognizes the gentleman from georgia, mr. scott. >> thank you very much, mr. chairman. this has indeed been a very, very interesting hearing, a very important one, let me say at the

outs outset, that atlanta is the world's busiest airport, and i always like to tell people whenever you lan at the airport in atlanta, you los angeles in congressman david scott's district, so i say welcome to that. certainly welcome to you, mr. anderson. now, i have listened to this discussion with a very jaundiced air s i don't see where the success and the movement followed of the xm bank is not mutually -- is mutually exclusive to addressing the concerns of our airlines. i would like to see the committee, mr. chairman, give some very thoughtful -- we have a very talented, skillful committee. it seems to me that we ought to be able to address these concerns, narrowly focused on what mr. anderson and captain

mark are saying, without interfering with the forward progress and very basic need that the xm bank hats provided for small businesses that mr. wilburn has done. there may be some on this committee that want to do away with the bank all together. i'm not one of those, because it has been very beneficial. but i think we would be very derelict in our duty as a legislative body to ignore the very pointed concerns that have been raised by mr. anderson and mr. mark. i think we can have folks from both sides to go to work to try to put some language into this xm extension that will address those concerns. so with that captain and mr.

anderson, let's narrow in specifically. i think what concerns you most is the competition with the wide bo body or the boeing 777. what can we do to put in some language that would address that? it could be a trigger mechanism or assessment as ms. mccarthy said? mandating things are rather different. what can we do to move this forward? >> congressman scott, i want to first thank you -- i don't know if you remember, but you stood by my side in front of 1,000 pilots, and your speech is still viewed in that light with what you stood up and said, this is a truly a david and goliath, and when david was walking back and said, is there a cause. the cost here is xm bank reform. i committal our resources,

everything, to work on that narrow part of the reform we need so we meet a fellow veterans needs, maul business needs, but we immediate our neither so, we stop losing jobs. i would be happy, our team will help, anything we can do, and thank you again for that day. you know where we've come from. >> absolutely, i certainly understand. mr. anderson, what would be the narrow scope of language that we could add that could address your problem? >> the bank would not finance below market wide-body airplanes for state subsidized airlines that are otherwise creditworthy form there won't be a need, and that would solve the competitive issue. because what we're dealing with is a much broader competitive issue. i think both sides of the aisle

have addressed this. we don't compete in my business against other companies. in our business, we compete against government. so our big competitors internationally are governments that happen to have a department that's an airline. they get huge, huge subsidies. it really hurts us when our government gives them a subsidy on top of the huge subsidy they already collect. >> my time is running out. mr. chairman, i think it might be wise if we could make a point of order that, as we move forward with this, that we could develop some language -- i would be delighted to work with your side on that -- that i think could accomplish that as we move this forward. the chair now recognizes the gentleman from new mexico, mr. pierce. >> thank you, mr. chairman.

appreciate each one of you making the appearance here today. mr. wil december burn, could you tell me more about those obstacles? >> i'm sorry, congressman. could you repeat your question? i didn't quite catch it. >> i was asking if you could go a bit deeper into the obstacles that you face as a small business. you had mentioned the barriers to entry and the subsidies to oil and gas, and you 136d the deflex allowance? how is it those keep you out of the domestic market or make it less available? >> make it less available, because i'm basically competing with the price of natural gas. trust me, i'm an advocate of

strong natural gas resources here, but i go to landfills, pollution sources, and i take that organic material and make methane. that has a cost, but it also has benefits. oil and gas has a subsidy, if you want to call it that, that allows them an advantage over my product. i don't have access to that. so i have to go to markets where i have a chance to compete. those marx are where there's not a natural gas reserves, and they don't receive those subs decides. >> the oil and gas company has to pay for that. in other words, they don't just get it for free. they have to pay for it. so basquely all that is is a depreciation of what they have paid. now -- correct? >> it's the same benefit 679. >> well, do you pay for -- when

you go to a landfill, do you have to pay to get the right to harvest that gas? >> absolutely. >> and so you don't get a write-off for creating that gas, you don't have to -- you don't get a write-off if? >> no. >> that is probably something that we should consider, but in contrast it's not the majors -- the major producers that would provide a barrier to entry don't get the deplegs allowance, just the independents, small producers, that is 12% of the market. you know, mr. chairman we have talked today about the catastrophic effects thats we're going to have on the jab market if we don't takes action, but i don't think what we do here is going to affect jobs nearly as much as other things. the gentlelady from minnesota

had gotten this k06rd pretty well. the corp tax rate, the president has said is protect one of the biggest embedments, and i sent him a her personally saying i would work with you on that, sir, because i agree that one of the greatest embedments to manufacturing in this country is the corporate tax, but i have yet to hear from the president, and that's been four years ago, but the regulations are where we are killing the job market. for instance, 58% of timber jobs are gone from america. one government regulation that said the spotted owl is going extinct because of logging, and the government came back last year and said, oop logging wasn't the problem. we have not only a government that intervenes, but a stupid government that intervenes. 23,000 agriculture jobs in the san joaquin valley went begging because of a two-inch smelt.

now we're importing 80% of our vegetables that spray things we could not spray before. that has hurt the job market in america more than what we do in the xm bank. we passed a bill through this congress in 2007 that outlaud the incandescent light bulb. that last facility closed do you and china is able to produce the small curly bulbs because of actions by this, and that was not an xm problem. we have continually put the consumers at risk by driving the price of electricity up, and the president has said, yes electricity is going to be necessarily higher because of our regulations, and we're a 70% retail economy, yet i he no one on this committee defending the -- we're killing the consumer market by higher electricity. it's the government, it's the

government that's at fault. the government is not the solution. i yield back. >> the chair now recognizes the gentleman from texas, mr. green, ranks member of the oversight investigation subcommittee. >> thank, mr. chairman. i thank the witnesses for appearing, and i specially thank our two veterans who are a part of this panel, and mr. wilburn, i thank you, because you indicated that you may have, or may be impacted by pts. and that sells to me you have some experiences that were less than pleasant. my prayers are with you. i'm reminded of chairman barney frank, who the topic of reality versus desires would often say

he wished that he could eat more and lose weight. i wish that i had options other than -- i would dearly like to have options other than end it or extend it. but these are the options that we seem to be confronting, and i'm a person who i believes in compromise and i'm willing to work across lines to do something other than end or extend. but given that these are the options, let me just share some of the comments associated with the options that are before us. "houston chronicle" published on june 25th, 2014, that would be today, editorial -- no time for games. export/import bank loans support american jobs.

including houston-area jobs. apparently mr. hochberg was interviewed by the chronicle and gave his commentary. the chronicle goes on to indicate, large other small, export/import bank loans support american jobs, including jobs in the houston area. bank officials told the chronicle that its financing has supported $11 billion in export sales from the area since 2009. with 3.5 billion of that attributable to small businesses. the bank also cost taxpayers nothing. it supports itself through the fees and interest it charges and regularly sends money to the u.s. treasury to reduce the debt. this is from "the houston chronicle." i concur with the ranks member

with reference to there being persons of note who are not here to testify today. and if they were here to testify i believe they would say, some of them, what the greater houston partnership says. the greater houston partnership indicates, and this is an excerpt, small and medium-sized businesses in our region also benefit directly from export/import. small businesses account for nearly 85% of xm banks transactions. further, these transactions figures do not include the tens of thousands of small and medium size businesses that support gets and services to large exporters using the bank. we trust -- this is addressed to me -- we trust you will carefully consider the impact xm bank has on our region, and our

position as a global economic leader. now, this letter while sent from the greater houston partnership appears to be supported by the bay area houston economic partnership. the baytown chamber of commerce, britainham chamber of commerce, the clear lake chamber of commerce, the greaterer houston partnership, the greater -- the houston each enchamber of commerce, the houston -- the lake houston area chamber of commerce, the west chambers county chamber of commerce, and the wharton chamber of commerce. finally there are some small businesses in the houston area, if they were given the opportunity to testify, would indicate they are supportive of the xm bank as well.

this would include the south coast products business, also include the hallmark sales corporation in houston, this is not the core company. also include the everest valve company in houston, and others. thank you, mr. chairman,ly yield back. >> time of the gentleman has expired. the chair now recognizes the gentleman from missouri, mr. luken mire. >> thank you, mr. chairman and i thank the witnesses for being here today. i serb appreciate your testimony, and mr. anderson and captain moak, thank you for your comments and concerns. i appreciate the fact that you have brought issues to light with regard to the aircraft manufacturing sales or financing portion of this, the bank. i think those need to be addressed, but i congratulation mr. wilburn and thank you for

your testimony from the testimony this is we have several things to discuss, and that is the small business portion of this as well. in 2013, aircraft manufacturing made up only 40% of xm's financ and 40% went to other manufacturing and 20% went to oil, gas, space services and mining so it has a lot of other financing interests that it takes care of and works with. i think that the statements have been made many times this afternoon and morning, about 3400 of the 3800 loans it made were to small businesses. and so i think at the end of the day it's something we need to consider howing with find a way to reform it. make it work for everybody. i get this crony capitalism comment and it sticks in my craw a little bit from the standpoint is that cross-examiny capitalism is when you hand out favors to somebody else as a favor for them having done something for you and, yet, the federal

government helps with v.a. loans, is that crony capitalism? v.a. loans? veterans build their homes? is that crony capitalism? we have in our treaties and our export and trade, tariffs and all sorts of protections with regards to everybody in automobile manufacturing,ing a cullal projects and intellectual property to be able to protect and incentivize businesses here in this country to compete internationally and protect their products so they can compete and provide jobs here. doctor made the comment she would like to see it all go away. that would be great. we live in a perfect world, that would be fine. but if that would happen and none of the rest of the world, the comments that have been made before a couple of times, what would happen? let's think about that for a second. what would happen if we went and did away with all our tariffs and all intellectual property

protections and the rest of the world could come in and rape and pillage our industries throughout this country. we have no ability to protect and they could compete, subs diagnose and take all of our jobs away. we'd lower the price of products if the supermarket and the hardway wear stores and whatever but our jobs would be gone, wouldn't they? and we'd suffer. the quality of life would go down. some things would be a national security problem for us because we'd lose the ability to be able to bill things, provide services for things that are of national importance to ourselves. in my district alone we had the smelter in this country. and now we send it to china and now you know what we do when we want to build a bullet? we have to go to china and buy our lead back. that's what would happen if you continue down this path of for getting about how to protect our industries, protect our ability

our industries to compete. is it a perfect world? no, it's not. not what i'd like to have either but at the end of the day i think we have to find a way to come together to realize that there has to be a way to find a middle ground on the. to reform this thing. i'm a banker. there's a half a dozen things i'd love to see change about this thing. i'm working with congressman chandler. i believe this can be done. i believe there's enough good about this thing. this entity that we can use it for the good of the people, our country and our industries. does it need to be reformed? absolutely. a few things that drive me up the wall. mr. wilburn, you make a great point from the standpoint of the importance of how this bank can help small business compete, can grow and market a product that may not be able to be marketed in this country but can be by other countries in the world.

by enabling our markets and our entrepreneurs in the country to be able to build this product. market it and bring revenue to our country instead of sending it out. mr. chairman, i yield back the balance of my time. i appreciate the opportunity. >> chair recognizing gentle lady from wisconsin, ms. moore. i'm sorry. if the gentle lady would suspect, i'll recognize the gentleman from texas briefly for unanimous consent. >> i ask unanimous consent the letters and documents that i've referenced be submitted for the record if there are no objections? >> without objection. >> now i recognize, i apologize, the gentle lady from west. >> thank you, mr. chairman for having this hearing. i think it's extremely important to everyone. i want to raise a bit of caution to captain mulkin, mr. anderson here, i've heard you say

continually that you want the bank to be reformed and not dismantled. i've clearly heard that. i want you to be clear. that this hearing is about whether or not we are going to reauthorize this bank and the authorization is going to expire in 90 days or so. and there are not many days left in this session. our chairman has been very articulate in indicating that he does not believe in this kind of government activity. we had a very passionate witness. dr. rugie, i'm sorry she had to leave before i had a chance to ask her some questions. very, very passion that the. giving her economic view this was bad so i want you to be clear that you are sitting on the side of people who don't want this to be 12e7extended. i want to associate myself with many of the excellent comments

and questions that have been made by my colleagues on both sides of the i'm and want to remind people that we're not talking about just boeing or the airline industry here. i represent an area that's home to six fortune 1000 companies like johnson, harley davidson. we're second in the country in manufacturing and we're dominated by small to medium-size metal fab k fabric an i'm emhit theic to them and there are, other hundreds of thousands of other employees that rely on these activities and, indeed, delta got 45.5 million subsidy from the export import bank for their engine

maintenance services. 400 jobs. that relied on the export import bank. in order to do maintenance. i believe, for brazil. i see you shaking your head. maybe i'll give you a chance to answer. i have a chart up here because there are a couple of things that i really want to point out. we've heard a lot of testimony about how the export import bank you know, creates competition and that greenline below, shows the last nine brand new airplanes that were built by boeing. that's the -- that is the interest rate and the price that they paid as compared to the commercial bank financing rate in the red and the blue line there ask the oecd agreement, the gentlemen's agreement that

we've heard so much about with regard to what export credit agencies can provide. delta is buying planes at that level, at that green level. we're not squeezing out the private sector. one other thing that i continue to hear over and over again was about the flip mine in michigan and the export/import bank was creating an unfair situation and i'm concerned because caterpillar is headquartered in the midwest. they have a huge operation in mr. ryan's district right across the street from my district. and many of my constituents work at caterpillar and the iron ore comes out were two different iron ores and two different applications. apples oranges are both fruit

but they're not the same so that was not true. i don't have much time so i will yee yield the rest of my time. >> i just like to make the point that the threat to american manufacturing base is existential. it's very real. as we sit here the chinese at considerable state investment are developing an airplane to compete with both airbus and boeing, the c 191 i believe. they have an export credit authority that's larger than ours. a larger percentage of their gdp than ours and be assured that when they successfully complete development of their airplane they will compete with us on the opened market. more to say later. >> time that the gentlelady has expired. the chair recognizes the gentleman from tennessee. >> thank you, mr. chairman. i'm going to give mr. anderson briefly a chance to respond. i will have the question also

have the question that you guys did receive financing from a canadian import/export. >> i'm glad you asked the question. delta is a huge manufacturing company. we have 7,000 manufacturing jobs and one of the largest engine overhaul companies in the united states. we run the largest shop in the united states. and gold is a terrible example for the xm bank. i think it was something they contrived to try to say that it created jobs at delta as we're an opponent of the bank. in 2010, we won a worldwide competition to overhaul engines that gull airways in brazil. it had nothing to do. the xm bank wasn't involved and we won it against la tan za and ge and two years later the bank went to brazil and gave them a loan for .622%. i know about this because we own