[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]


                      EXAMINING THE EXPORT-IMPORT
                            BANK'S MANDATES

=======================================================================

                             JOINT HEARING

                               BEFORE THE

                        SUBCOMMITTEE ON MONETARY

                            POLICY AND TRADE

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                                AND THE

                 SUBCOMMITTEE ON HEALTH CARE, BENEFITS

                        AND ADMINISTRATIVE RULES

                                 OF THE

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 30, 2015

                               __________

  Printed for the use of the Committee on Financial Services and the 
              Committee on Oversight and Government Reform

                           Serial No. 114-19
                      Financial Services Committee

                           Serial No. 114-32
               Oversight and Government Reform Committee
               
               
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                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                    JEB HENSARLING, Texas, Chairman

PATRICK T. McHENRY, North Carolina,  MAXINE WATERS, California, Ranking 
    Vice Chairman                        Member
PETER T. KING, New York              CAROLYN B. MALONEY, New York
EDWARD R. ROYCE, California          NYDIA M. VELAZQUEZ, New York
FRANK D. LUCAS, Oklahoma             BRAD SHERMAN, California
SCOTT GARRETT, New Jersey            GREGORY W. MEEKS, New York
RANDY NEUGEBAUER, Texas              MICHAEL E. CAPUANO, Massachusetts
STEVAN PEARCE, New Mexico            RUBEN HINOJOSA, Texas
BILL POSEY, Florida                  WM. LACY CLAY, Missouri
MICHAEL G. FITZPATRICK,              STEPHEN F. LYNCH, Massachusetts
    Pennsylvania                     DAVID SCOTT, Georgia
LYNN A. WESTMORELAND, Georgia        AL GREEN, Texas
BLAINE LUETKEMEYER, Missouri         EMANUEL CLEAVER, Missouri
BILL HUIZENGA, Michigan              GWEN MOORE, Wisconsin
SEAN P. DUFFY, Wisconsin             KEITH ELLISON, Minnesota
ROBERT HURT, Virginia                ED PERLMUTTER, Colorado
STEVE STIVERS, Ohio                  JAMES A. HIMES, Connecticut
STEPHEN LEE FINCHER, Tennessee       JOHN C. CARNEY, Jr., Delaware
MARLIN A. STUTZMAN, Indiana          TERRI A. SEWELL, Alabama
MICK MULVANEY, South Carolina        BILL FOSTER, Illinois
RANDY HULTGREN, Illinois             DANIEL T. KILDEE, Michigan
DENNIS A. ROSS, Florida              PATRICK MURPHY, Florida
ROBERT PITTENGER, North Carolina     JOHN K. DELANEY, Maryland
ANN WAGNER, Missouri                 KYRSTEN SINEMA, Arizona
ANDY BARR, Kentucky                  JOYCE BEATTY, Ohio
KEITH J. ROTHFUS, Pennsylvania       DENNY HECK, Washington
LUKE MESSER, Indiana                 JUAN VARGAS, California
DAVID SCHWEIKERT, Arizona
FRANK GUINTA, New Hampshire
SCOTT TIPTON, Colorado
ROGER WILLIAMS, Texas
BRUCE POLIQUIN, Maine
MIA LOVE, Utah
FRENCH HILL, Arkansas

                     Shannon McGahn, Staff Director
                    James H. Clinger, Chief Counsel
               Subcommittee on Monetary Policy and Trade

                   BILL HUIZENGA, Michigan, Chairman

MICK MULVANEY, South Carolina, Vice  GWEN MOORE, Wisconsin, Ranking 
    Chairman                             Member
FRANK D. LUCAS, Oklahoma             BILL FOSTER, Illinois
STEVAN PEARCE, New Mexico            ED PERLMUTTER, Colorado
LYNN A. WESTMORELAND, Georgia        JAMES A. HIMES, Connecticut
MARLIN A. STUTZMAN, Indiana          JOHN C. CARNEY, Jr., Delaware
ROBERT PITTENGER, North Carolina     TERRI A. SEWELL, Alabama
LUKE MESSER, Indiana                 PATRICK MURPHY, Florida
DAVID SCHWEIKERT, Arizona            DANIEL T. KILDEE, Michigan
FRANK GUINTA, New Hampshire          DENNY HECK, Washington
MIA LOVE, Utah
              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                     JASON CHAFFETZ, Utah, Chairman
JOHN L. MICA, Florida                ELIJAH E. CUMMINGS, Maryland, 
MICHAEL R. TURNER, Ohio                  Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee       CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio                     ELEANOR HOLMES NORTON, District of 
TIM WALBERG, Michigan                    Columbia
JUSTIN AMASH, Michigan               WM. LACY CLAY, Missouri
PAUL A. GOSAR, Arizona               STEPHEN F. LYNCH, Massachusetts
SCOTT DesJARLAIS, Tennessee          JIM COOPER, Tennessee
TREY GOWDY, South Carolina           GERALD E. CONNOLLY, Virginia
BLAKE FARENTHOLD, Texas              MATT CARTWRIGHT, Pennsylvania
CYNTHIA M. LUMMIS, Wyoming           TAMMY DUCKWORTH, Illinois
THOMAS MASSIE, Kentucky              ROBIN L. KELLY, Illinois
MARK MEADOWS, North Carolina         BRENDA L. LAWRENCE, Michigan
RON DeSANTIS, Florida                TED LIEU, California
MICK, MULVANEY, South Carolina       BONNIE WATSON COLEMAN, New Jersey
KEN BUCK, Colorado                   STACEY E. PLASKETT, Virgin Islands
MARK WALKER, North Carolina          MARK DeSAULNIER, California
ROD BLUM, Massachusetts              BRENDAN F. BOYLE, Pennsylvania
JODY B. HICE, Georgia                PETER WELCH, Vermont
STEVE RUSSELL, Oklahoma              MICHELLE LUJAN GRISHAM, New Mexico
EARL L. ``BUDDY'' CARTER, Georgia
GLENN GROTHMAN, Wisconsin
WILL HURD, Texas
GARY J. PALMER, Alabama

                    Sean McLaughlin, Staff Director
                  Rachel Weaver, Deputy Staff Director
                    Andrew Dockham, General Counsel
                        Laura Rush, Chief Clerk
                 David Rapallo, Minority Staff Director
      Subcommittee on Health Care, Benefits & Administrative Rules

                    JIM JORDAN, Jr., Ohio, Chairman
TIM WALBERG, Michigan,               MATT CARTWRIGHT, Pennsylvania, 
SCOTT DesJARLAIS, Tennessee              Ranking Member
TREY GOWDY, South Carolina           ELEANOR HOLMES NORTON, District of 
CYNTHIA M. LUMMIS, Wyoming               Columbia
MARK MEADOWS, North Carolina         BONNIE WATSON COLEMAN, New Jersey
RON DeSANTIS, Florida                MARK DeSAULNIER, California
MICK MULVANEY, South Carolina Vice   BRENDAN F. BOYLE, Pennsylvania
    Chair                            JIM COOPER, Tennessee
MARK WALKER, North Carolina          MICHELLE LUJAN GRISHAM, New Mexico
JODY B, HICE, Georgia
EARL L. ``BUDDY'' CARTER, Georgia
                             
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    April 30, 2015...............................................     1
Appendix:
    April 30, 2015...............................................    59

                               WITNESSES
                        Thursday, April 30, 2015

Hochberg, Hon. Fred P., President and Chairman, Export-Import 
  Bank of the United States......................................     8

                                APPENDIX

Prepared statements:
    Hochberg, Hon. Fred P........................................    60

              Additional Material Submitted for the Record

Chaffetz, Hon. Jason:
    Reuters article entitled, ``US Ex-Im acknowledges errors in 
      politically sensitive small biz data,'' dated November 14, 
      2014.......................................................    70
Heck, Hon. Denny:
    Letter dated April 16, 2015, from Hon. Fred P. Hochberg, 
      President and Chairman, Export-Import Bank of the United 
      States, in response to a question from Chairman Chaffetz at 
      the April 15, 2015, hearing................................    72
    Letter dated April 24, 2015, from Hon. Fred P. Hochberg, 
      President and Chairman, Export-Import Bank of the United 
      States, in response to a question from Representative Hice 
      at the April 15, 2015, hearing.............................    83
Moore, Hon. Gwen:
    Joint written statement of the Bankers Association for 
      Finance and Trade and the Financial Services Roundtable....    89
    Written statement of the U.S. Chamber of Commerce............    91
    Letter from a group of State Governors in support of 
      reauthorizing the Ex-Im Bank...............................   111
Hochberg, Hon. Fred P.:
    Written responses to questions for the record submitted by 
      Representative Stutzman....................................   115

 
                      EXAMINING THE EXPORT-IMPORT
                              BANK'S MANDATES

                              ----------                              


                        Thursday, April 30, 2015

             U.S. House of Representatives,
                           Subcommittee on Monetary
                                  Policy and Trade,
                           Committee on Financial Services,
                                     joint with the
                       Subcommittee on Health Care,
                 Benefits and Administrative Rules,
                                 Committee on Oversight and
                                          Government Reform
                                                   Washington, D.C.
    The subcommittees met, pursuant to notice, at 1:20 p.m., in 
room 2154, Rayburn House Office Building, Hon. Bill Huizenga 
[chairman of the Monetary Policy and Trade Subcommittee] 
presiding.
    Members present from the Subcommittee on Monetary Policy 
and Trade: Representatives Huizenga, Mulvaney, Lucas, Pearce, 
Stutzman, Pittenger, Messer, Schweikert, Guinta, Love; Moore, 
Perlmutter, Himes, Carney, Murphy, and Heck.
    Members present from the Subcommittee on Health Care, 
Benefits and Administrative Rules: Representatives Jordan, 
Gowdy, DeSantis, Mulvaney, Walker, Hice, Carter; Cartwright, 
and DeSaulnier.
    Ex officio present: Representatives Hensarling, Chaffetz, 
and Waters.
    Also present: Representatives Massie, Blum, Green, and 
Ellison.
    Chairman Huizenga. The Subcommittee on Monetary Policy and 
Trade of the Committee on Financial Services and the 
Subcommittee on Health Care, Benefits and Administrative Rules 
of the Committee on Oversight and Government Reform will come 
to order. That is quite a mouthful.
    Without objection, the Chair is authorized to declare a 
recess at any time. We all know that we have votes that are 
rather imminent.
    Because we are dealing with two subcommittees, we also have 
interest from our full committee Chairs and ranking members, as 
well. I will be giving an opening statement. We will then go to 
Ms. Moore from Wisconsin for her opening statement. Next, we 
will go to Mr. Jordan, and then Mr. Cartwright. At that point, 
we will go to Mr. Hensarling. If he is so moved to decline, 
that is fine. Ms. Waters is interested in having an opening 
statement. And then Mr. Chaffetz, if he so chooses, as well.
    I would like to thank everybody for being here on this 
important issue. And to my friend, Mr. Jordan, I appreciate 
your willingness and eagerness to again hold a joint hearing to 
further examine the Export-Import Bank's political mandates and 
its sordid past.
    The Export-Import Bank's stated goal is to support American 
jobs through exports. However, in my opinion, judging by the 
Bank's prior financing deals, it appears to be doing quite the 
opposite oftentimes. American taxpayers have been unwittingly 
propping up foreign state-owned companies in Saudi Arabia, 
Russia, China, Venezuela, Pakistan, India, Colombia, Mexico, 
Ethiopia, South Africa, and others who have done nothing but, 
frankly, work against the best interests of American citizens.
    In fact, of the 50 largest loans or guarantees approved by 
the Ex-Im Bank since Fiscal Year 2007, 46 percent of those by 
dollar amount of the loans have gone to foreign state-owned 
companies or a joint venture that includes a state-owned 
company.
    Additionally, the Export-Import Bank has a bit of an 
unsavory track record involving corruption, bribery, and fraud. 
Perhaps the most infamous example of illegal behavior is that 
of former Congressman William Jefferson, a Democrat, and a 
colleague of ours from Louisiana, who was raided by the FBI, 
convicted, and sent to prison for bribery, racketeering, and 
money laundering. You all may remember him better as the 
Congressman who stuffed his freezer with $90,000 in cold hard 
cash, literally.
    Jefferson was working with an Ex-Im employee, as well as an 
Ex-Im board member, to broker a deal between two Nigerian 
companies seeking financial support from Ex-Im Bank. This is 
just one example of how the political mandates for particular 
sectors and regions around the world have invited a culture of 
corruption by creating perverse incentives for the Bank's staff 
to meet arbitrarily-stated goals.
    While time has passed, it appears the culture within Ex-Im 
has not, unfortunately. Just last year, Ex-Im removed four 
employees for accepting gifts and kickbacks from companies 
seeking export financing. In fact, one of these former 
employees was charged by the Department of Justice a little 
over 2 weeks ago for taking bribes numerous times between 2006 
and 2013. And he subsequently had pled guilty.
    This doesn't appear to be an isolated incident, either. 
During our previous joint Ex-Im hearing held on April 15th, 
after more than 2 hours of testimony, the acting inspector 
general of the Export-Import Bank announced that there are 47 
people who have been convicted of defrauding the Bank in the 
past 5 years, and that there are at least 31 open 
investigations with the potential for even more indictments.
    The more that is unearthed about the Export-Import Bank, 
the more concerned I become. While the goals and objectives of 
the Bank might be admirable, the current state of the Bank is 
abhorrent at best. Why should Congress spend tax dollars on an 
organization that has reestablished a track record of 
corruption? And why should American tax dollars be used to 
finance foreign government-owned or operated companies that 
compete against American workers?
    A clean reauthorization which has been proposed by a few up 
here of the Bank does not propose taxpayers with the 
accountability that is expected from my constituents in 
Michigan or the overwhelming majority of citizens around the 
Nation.
    I look forward to hearing from you, Chairman Hochberg--and 
I do appreciate you being here, sir--about your plan to clean 
up the Bank and your plan to polish up its image and, frankly, 
your image as well, or it may close up shop.
    So with that, I would like to recognize my ranking member 
on the Monetary Policy and Trade Subcommittee, Ms. Moore of 
Wisconsin, for 5 minutes.
    Ms. Moore. Thank you so much, Mr. Chairman, for yielding me 
the time.
    I would like to ask unanimous consent to enter into the 
record statements from the U.S. Chamber of Commerce, and the 
Financial Services Roundtable, as well as a letter from a group 
of State Governors.
    Chairman Huizenga. Without objection, it is so ordered.
    Ms. Moore. Thank you so much.
    In relation to the reauthorization of the Export-Import 
Bank, we just keep hearing the buzzwords ``regular order,'' 
which makes me wonder, what kind of regular order is it for the 
authorizing committee--and maybe it is just pride in 
authorizing committee jurisdiction--the House Financial 
Services Committee to take this odd detour and basically kind 
of yield our authority over to the Oversight and Government 
Reform Committee?
    It is not that I don't think like my friends on the 
Oversight Committee. But after hearing comments that ending the 
Bank is on schedule, from Oversight Committee members saying 
that ending the Bank is on schedule, I fear that this irregular 
order is a furtherance of a strategy of a minority of this body 
to end the Bank by just running out the clock.
    Now, what did we learn at the last hearing? We learned that 
people acted in criminal ways and targeted the Bank, and that 
the Bank's internal controls work. And those people were 
discovered and punished, which is more than I can say for many 
of our Wall Street banks. If we need to throw more people in 
jail, let's do it. Let's not throw the baby out with the bath 
water. Let's not throw the Bank out with those criminal 
elements.
    We learned that the Bank is a demand-driven organization 
that buttresses private finance to correct for imperfect 
markets for the benefit of small and large businesses, 
supporting a huge supply chain. People with--10, 15 people who 
make parts.
    We learned that the Bank does not compete for projects. 
Rather, it works with private finance, as the letters from the 
U.S. Chamber of Commerce and the Financial Services Roundtable 
will attest.
    We learned that the Export-Import Bank supported 164,000 
U.S. export jobs in 2014.
    We learned that the Bank has a default rate that would be 
the envy of any Wall Street Bank.
    We learned that the Bank has implemented the reform from 
2012 and met the GAO requirements.
    We learned that there is nothing to the strawman accusation 
that some have leveled at the Bank.
    I am so excited for the prospect of reauthorizing this 
Bank. I hail from Milwaukee, Wisconsin. We have been known as 
the machine makers of the world. And I can take you on a tour 
miles and miles and miles through my district on either side of 
the street and show you small--I mean teeny, tiny--machine 
shops and welders, some of them with 4 employees, some of them 
with 10 employees who are dependent upon reauthorization of 
this Bank for their survival.
    And I would hope that the majority of this body--and when I 
say ``majority,'' I am not talking Republicans--the majority of 
those people who support the Bank, which is a--if people were 
honest and if they would vote their heart and vote their 
districts, we would have the votes.
    I would like to yield one minute to Mr. Heck.
    Chairman Huizenga. Without objection, the gentleman is 
recognized.
    Mr. Heck. I thank the gentlelady from Wisconsin.
    And before we begin, I would like us all to take a step 
back and remember why we have the Ex-Im Bank. We are indeed a 
country built on free markets. I take as much pride in that 
fact as the Chair of the full committee does.
    Because of that free market history, however, and despite 
its success, we know they are not perfect. Sometimes, like back 
in 2008, financial markets locked up and credit wasn't 
available. Even in good times, small businesses often don't 
have access to the financial tools that big businesses do, 
especially including export loans.
    In some parts of the world there are good customers but bad 
legal systems, so credit is not available. Even if there were 
no foreign competitors, we should still have an Ex-Im because 
markets still would not be perfect. There is still a need for 
something to help small businesses export, to help the 
developing world access credit to buy our goods. That is what 
these mandates do. Our faith in small businesses is why we have 
the Ex-Im.
    Thank you, Mr. Chairman.
    Chairman Huizenga. The gentlelady's time has expired.
    With that, the Chair recognizes my fellow Chair, the Chair 
of the Subcommittee on Health Care, Benefits and Administrative 
Rules, Chairman Jordan, for 5 minutes.
    Chairman Jordan. I thank the Chair.
    The gentlelady from Wisconsin asked the question, what did 
we learn 2 weeks ago, at the last hearing? I will tell you what 
we learned. We learned that Ex-Im Bank employee Johnny 
Gutierrez was indicted 36 hours before that hearing. He has now 
pled guilty. Last week, he pled guilty.
    We learned that there are 31 open fraud investigations that 
both the inspector general and the Department of Justice are 
looking into at the Export-Import Bank.
    And most importantly, what we learned from the inspector 
general, who sat in the same chair Mr. Hochberg is in today, is 
that there may be more indictments coming in the Gutierrez case 
and more indictments coming in those 31 open fraud 
investigations. That is what we learned.
    We also learned that the Administration has failed to 
meaningfully comply with the requirements passed by Congress 
and signed into law as part of the Ex-Im Bank's 2012 
reauthorization. In fact, the Bank continues to resist reforms 
in that reauthorization.
    The focus of today's hearing is on the political nature of 
the Bank's portfolio. While all the Bank's subportfolios have 
significant problems, I personally am most concerned with the 
Bank's support of renewable energy. The Bank is mandated to 
dedicate 10 percent of its portfolio to support green energy 
exports. Here is the trouble. The entire market for U.S. 
exports of green energy technology is smaller than 10 percent 
of the Ex-Im's portfolio. This creates the pervasive incentive 
at the Bank to rubber stamp green energy applications.
    Back in February 2011, the Ex-Im Bank authorized now-
bankrupt Solyndra $10 million in guarantees during the same 
time period in which the company negotiated and restructured 
its 1705 loan guarantee agreement with the Department of 
Energy.
    John Scott, former vice president of Solyndra, touted the 
expedited manner in which the Ex-Im Bank granted Solyndra the 
loan guarantee, just 41 days. He said this was ``a fast due 
diligence process.''
    Ex-Im also made loans to several other companies that 
benefited from the Department of Energy loan program, including 
First Solar, which this committee investigated in 2012 and 
found to have significant problems.
    The green energy mandate also breeds cronyism and 
corruption. Earlier this year, the Washington Free Beacon 
reported that Ex-Im board member Diane Farrell left the Bank to 
join Azure Power after helping it secure $16 million in export 
assistance to help the company purchase solar panels from First 
Solar. Wow, isn't that convenient.
    Recently, Michael Whalen was hired by the Bank as the vice 
president of structured finance. He comes from Solar Reserve, 
which had a junk bond rating, but still received $737 million 
from this Administration's program that supported Solyndra and 
has has been a candidate for Ex-Im financing.
    There is Tom Kiernan. He joined the Bank's advisory 
committee earlier this year, and he is also chief executive of 
the American Wind Energy Association, which represents many 
companies that have received financing from the Bank.
    The Ex-Im Bank is a perfect example of how big business and 
powerful special interests manipulate Washington to get their 
way. Senator Obama was exactly right in 2006 when he called the 
Bank, ``little more than a fund for corporate welfare.''
    Every Republican presidential candidate is against it. 
Every outside fiscal conservative group wants this Bank to go. 
The chairmen of the relevant committees in Congress--Chair Ryan 
of the Ways and Means Committee, Chairman Chaffetz of the 
Oversight Committee, Chairman Price of the Budget Committee, 
and Chairman Hensarling of the Financial Services Committee--
support ending the Bank.
    The House majority leader supports ending the Bank. The 
House majority whip has also expressed opposition to the Bank. 
And the best part of all this is all we need to do is something 
Congress is pretty good at: nothing. Just don't reauthorize it. 
It will naturally unwind. All of the loans out there, the terms 
and conditions will be met, some of them as far out as 18 
years.
    There is a story out today that the speaker has said we 
should look at this issue and make something happen. And I can 
remember an issue around this Congress a few years back where 
important folks said we could never end earmarks. And then 
along came this bridge to nowhere. And suddenly, Congress did 
what the American people wanted us to do and got rid of 
earmarks.
    I would say the same dynamic is in play here. The American 
people are fed up with corporate welfare. The bridge to nowhere 
of corporate welfare is the Export-Import Bank. And it is time 
it goes. And again, all we have to do to end this is to do 
nothing. Just let it wind down in its natural course.
    Mr. Chairman, I yield back.
    Chairman Huizenga. The gentleman yields back.
    With that, I now recognize Mr. Cartwright, ranking member 
of the Subcommittee on Health Care, Benefits and Administrative 
Rules for his opening statement. You have 5 minutes.
    Mr. Cartwright. Thank you, Mr. Chairman.
    And welcome again, Chairman Hochberg. I look forward to 
your testimony again.
    Today's hearing is intended to examine the Ex-Im Bank's 
operation under congressional mandates. These mandates include 
the requirement that no less than 20 percent of its 
authorization be used to finance exports by small businesses, 
and no less than 10 percent to finance exports for renewable 
energy or energy efficiency technologies.
    The Ex-Im Bank's transactions support billions of dollars 
in exports and hundreds of thousands of American jobs. With a 
default rate of just 0.174 percent, a default rate that I 
agree, Congresswoman Moore, would be the envy of most banks in 
the world, this Bank responsibly invests taxpayer funds, even 
generating a surplus to the U.S. Treasury.
    In Fiscal Year 2014, 89 percent of Bank transactions 
benefited small business exports of U.S.-made goods and 
services. Even when the Bank finances the purchase of exports 
from large corporations such as Boeing, you have to realize 
smaller companies benefit from this too. An example of this is 
Air Products, right in my district in northeastern 
Pennsylvania, which has two large plants in my district and 
employs hundreds of my constituents. This is a supplier of 
Boeing.
    The Bank is also active in promoting renewables, which will 
be essential in moving the world away from our fossil fuel 
dependence. In Fiscal Year 2013, the Bank supported almost $640 
billion in environmentally-beneficial U.S. exports, nearly 60 
percent of that for renewable energy.
    Just last week, the Bank celebrated Earth Day by presenting 
its deal of the year and renewable exporter of the year awards 
to Siemens Energy, Inc., for exporting wind turbines and 
helping the United States become an international leader in our 
renewable energy future.
    For most of its 80 years, the Ex-Im Bank has received 
support from both Republicans and Democrats and has been 
reauthorized without much debate 16 times. And I must mention 
that very renowned Republican conservative commentators are in 
support of reauthorization of the Ex-Im Bank, including the 
noted conservative economist Douglas Holtz-Eakin, who says the 
numbers speak for themselves. This is a net plus for American 
taxpayers and ideology shouldn't rule the day.
    In addition, just this afternoon, the speaker of the U.S. 
House, John Boehner, said this about the Ex-Im Bank, ``There 
are thousands of jobs on the line that would disappear pretty 
quickly if the Ex-Im Bank were to disappear.'' I read that from 
a political report from 12:25 p.m. today.
    And I ask unanimous consent that this be entered into the 
record, Mr. Chairman.
    Chairman Huizenga. Without objection, it is so ordered.
    Mr. Cartwright. So we have important Republican and 
conservative leaders speaking out in favor of reauthorizing the 
Ex-Im Bank, this supporter of so many hundreds of thousands of 
American jobs. But here we are 2 months away from the deadline 
to reauthorize the Ex-Im Bank, and the good old shutdown crowd 
has chosen to use this Bank as a political football. They have 
on their side powerful lobbying interests, such as Koch 
Industries, which this past March sent a letter to Congress 
urging Members to oppose the Bank's reauthorization.
    And so when my friend Chairman Jordan laments the 
involvement of big business in this debate, we must never 
forget that the biggest driver of the folks who want to shut 
down the Ex-Im Bank are the Koch brothers. This is hugely 
ironic. This is just an example of the Kochs attacking 
renewable energy, while pushing their own agenda, which is 
fossil fuels. While the Koch-funded Americans for Prosperity 
demands that Congress put an end to the Bank, calling its work 
``corporate welfare,'' Koch industries spent thousands lobbying 
against the President's Fiscal Year 2010 budget proposal in 
part because it repealed a number of tax incentives for the oil 
and gas industry.
    We have to ask ourselves, what are our priorities? Where do 
they lie? Do we want to support American companies, American 
jobs, and American exports? Do we want to move toward clean 
energy and promote renewable exports, or do we want to kowtow 
to this political ideology that is clinging to old energy 
solutions that pollute our environment and the environment of 
the world?
    I hope today's hearing will highlight the good work of the 
Bank. And I look forward to the testimony of Mr. Hochberg.
    I yield back.
    Chairman Huizenga. The gentleman's time has expired. And 
thank you.
    Now, I would like to recognize our witness. I am pleased to 
recognize the Honorable Fred Hochberg, president and chairman 
of the U.S. Export-Import Bank. Thank you for being with us 
today, Mr. Hochberg.
    And I will now yield to Mr. Jordan, who will swear our 
witness in.
    Chairman Jordan. Thank you, Chairman Huizenga.
    Pursuant to Oversight and Government Reform Committee 
rules, all witnesses will be sworn in before they testify. Mr. 
Hochberg, you have done this several times before. Please rise 
and raise your right hand. Thank you.
    [Witness sworn.]
    Let the record reflect the witness answered in the 
affirmative.
    Thank you. And I yield back to the Chair.
    Chairman Huizenga. Thank you. Mr. Hochberg, you will be 
recognized for 5 minutes, and your entire written statement 
will be made a part of the record.
    With that, I recognize our witness for 5 minutes.

  TESTIMONY OF THE HONORABLE FRED P. HOCHBERG, PRESIDENT AND 
       CHAIRMAN, EXPORT-IMPORT BANK OF THE UNITED STATES

    Mr. Hochberg. Thank you. Chairmen, ranking members, and 
distinguished subcommittee members, thank you for inviting me 
to testify today about the mandates that Congress has placed 
upon the Export-Import Bank.
    Ex-Im, as has been stated, is demand-driven. We are self-
sustaining. We charge our customers interest and fees for our 
services. And the result? In 2014, we supported 164,000 jobs. 
On top of that, we have sent nearly $7 billion to the Treasury 
over the past 2 decades, making Ex-Im one of the few agencies 
that actually makes money for the taxpayers.
    We have been reauthorized 16 times by overwhelming 
bipartisan majorities. Over that time, Congress has provided 
oversight and added three mandates: one for small business; one 
for renewable exports; and one for sub-Saharan Africa. Mandates 
have directed Ex-Im to provide extra attention to these three 
areas.
    The first, a benchmark for small business, was added by 
Congress in 1983 under President Reagan's first reauthorization 
of the Bank. Equipping U.S. businesses such as Fritz-Pak in 
Mesquite, Texas, or Tooling & Equipment in Livonia, Michigan, 
is at the heart of our work.
    In 2014, nearly 90 percent of Ex-Im's transactions directly 
served small businesses, accounting for a full 39 percent of 
the total value of all exports supported by the Bank.
    This does not include the thousands of small businesses 
like Tomco that I visited in Loganville, Georgia, or Ace Pump 
in Memphis, Tennessee, that are part of the supply chains of 
larger exporters. These small businesses benefit each time a 
larger company beats out a foreign rival for a sale.
    To put this in perspective, Ex-Im has approved more 
transactions in the past 6 years for small businesses than the 
previous 16 years combined. As has been stated, even in strong 
economic times, small businesses have difficulty in securing 
the financing they need to support their exports. However, with 
Ex-Im's help, banks are able to extend credit, giving U.S. 
exporters the liquidity they need to pursue sales, create new 
jobs, and compete effectively in global markets.
    Second, a requirement to address the environment was first 
initiated by Congress in 1989 under President Bush. This has 
been modified over the years, and is now a renewable energy 
export mandate. As a result, Ex-Im has equipped U.S. renewable 
exporters to face off against competitors from China, Germany, 
and Denmark, to name just a few.
    In 1994, we completed 10 transactions; 20 years later, the 
total is 116 renewable exports.
    Third, a congressional mandate was established in 1997 to 
``promote the expansion of the Bank's financial commitments to 
sub-Saharan Africa.''
    Ex-Im plays a critical role in countering China's 
aggressive financing of their exporters. Last year alone, China 
exported $100 billion to Africa. The EU topped that number. And 
the Americas came in at $38 billion.
    2014 was a record year for Ex-Im with $2.1 billion of 
financing, covering 192 transactions in sub-Saharan Africa. The 
Bank finances a higher portion of U.S. exports to sub-Saharan 
Africa than any other region of the world.
    In closing, Ex-Im takes its responsibility to protect the 
U.S. taxpayers very seriously. In those rare instances where 
there is a default, costs are covered by fees and interest paid 
to the Bank by our customers, not by taxpayers.
    The Bank's focus on comprehensive risk management is 
reflected in its default rate, which we just reported to 
Congress, of 0.167 percent. That was as of March 31, 2015.
    Ex-Im has continually improved its products and services to 
give entrepreneurs the tools they need to compete and win in 
the renewable energy sector in sub-Saharan Africa and against 
foreign small businesses. That means more U.S. jobs, and more 
American leadership abroad.
    I look forward to continuing to work with the committee on 
empowering your constituents to export, grow, and hire more 
American workers.
    [The prepared statement of Mr. Hochberg can be found on 
page 60 of the appendix.]
    Chairman Huizenga. Thank you, Mr. Chairman.
    At this point, I will ask for unanimous consent that 
members of the Financial Services and Oversight and Government 
Reform Committees who are not members of either one of these 
two subcommittees be allowed to fully participate in today's 
hearing. Without objection, it is so ordered.
    And with that, we will go to Health Care, Benefits and 
Administrative Rules Subcommittee Chairman Jordan for his 5 
minutes of questioning.
    Chairman Jordan. Thank you, Mr. Chairman.
    Mr. Hochberg, are you familiar with a 2010 Export-Import 
Bank-approved project in New Guinea?
    Mr. Hochberg. Sorry. I would need a little more 
information.
    Chairman Jordan. I will give you some more. There were 
several partners in it, but the majority partner was Exxon 
Mobil, with a 32 percent stake in this venture. Are you 
familiar with that deal?
    Mr. Hochberg. Oh, in Papua New Guinea, yes.
    Chairman Jordan. Papua, New Guinea?
    Mr. Hochberg. Yes.
    Chairman Jordan. You are familiar with that?
    Mr. Hochberg. Yes, I am familiar with that.
    Chairman Jordan. And do you recall how much of the 
financing the Export-Import Bank was responsible for in that 
deal?
    Mr. Hochberg. We financed about $3 billion.
    Chairman Jordan. $3 billion. That sounds like a lot of 
money. Is that a big amount of financing for the Ex-Im Bank?
    Mr. Hochberg. That is a very large amount.
    Chairman Jordan. Is it the largest in the Bank's history?
    Mr. Hochberg. No, it is not.
    Chairman Jordan. Was it the largest in the Bank's history 
at that time?
    Mr. Hochberg. I believe it was up to that point.
    Chairman Jordan. According to media reports it was the 
largest deal in Ex-Im history in 75 years and up to 2010. So 
what you are saying is, you have done bigger deals since then.
    Were there problems with the deal, any problems with that 
arrangement?
    Mr. Hochberg. This is a large project, in the range of $20 
billion. It is proceeding. The cost is still in line with 
expectations. And it is my knowledge--
    Chairman Jordan. So there are no problems? Are you saying 
there are no problems with the deal?
    Mr. Hochberg. Of course, there are problems. It is a $20 
billion giant infrastructure project in a remote part of the 
world.
    Chairman Jordan. How about this problem--your inspector 
general told Congress last June that the Bank couldn't account 
for $500 million. Would you define that as a problem?
    Mr. Hochberg. Let me explain what the--
    Chairman Jordan. My guess is the taxpayers would. So, the 
largest deal in Ex-Im history, largest deal in 75 years, $3 
billion, and you can't account for a sixth of it, and that is 
not a problem?
    Mr. Hochberg. $500 million is what is called ``local 
costs'' that are part of the transaction. We have--
    Chairman Jordan. No, it is called ``money.'' It is called 
taxpayer-financed money.
    Mr. Hochberg. We have certifications from Exxon Mobil that 
those costs were inline. And were incurred in the project--
    Chairman Jordan. But you can't account for it?
    Mr. Hochberg. We don't have--
    Chairman Jordan. Here is--
    Mr. Hochberg. We don't have--
    Chairman Jordan. Mr. Hochberg--
    Mr. Hochberg. --can't account for it.
    Chairman Jordan. I have 3 more minutes. So look, we 
learned, as I said in my opening statement, that an employee 
was indicted 2 weeks ago. Last week, he pled guilty. We learned 
of 31 open fraud investigations that both the inspector general 
and the Justice Department are looking into. We learned at the 
last hearing that there may be more indictments coming from 
both the Gutierrez case and those open fraud investigations.
    And today, the committee now--I bet many Members are just 
learning for the first time that in the largest deal in Ex-Im 
history, a $3 billion deal, the Ex-Im Bank can't account for 
one-sixth of it. You can't account for $500 million in 
taxpayer-backed money, correct?
    Mr. Hochberg. No, I would not agree with that, sir.
    Chairman Jordan. That is what the press says, not me. The 
inspector general said you can't account for $500 million.
    Mr. Hochberg. No. Exxon Mobil is entitled to local costs 
incurred on the project.
    Chairman Jordan. But this project--
    Mr. Hochberg. They submitted certification for $500 
million. What the inspector general has asked me, is he wants 
to see the actual invoices backing up the subsuppliers.
    Chairman Jordan. And you don't have it, right?
    Mr. Hochberg. We now require it. We did not require it at 
that time because we rely on--
    Chairman Jordan. But the point is--
    Mr. Hochberg. --certification of a Fortune 500 company to 
provide that information.
    Chairman Jordan. The point is that the inspector general 
said you can't account for it.
    Mr. Hochberg. We can account for it. One-sixth of the 
deal--the fact is--
    Chairman Jordan. Mr. Hochberg, I have a minute and 50 
seconds. Let me say this, it gets worse. Before you approved 
the $3 billion deal, the largest in the Bank's history, before 
you lost one-sixth of the money or can't account for one-sixth 
of the money, before you can't account for half a billion 
dollars of taxpayer money, you had four employees who, as they 
considered whether to approve the deal for Exxon Mobil, had 
their travel expenses paid for by Exxon Mobil. Isn't that 
correct, Mr. Hochberg?
    Mr. Hochberg. Due diligence trips are paid for by the 
project sponsor. They don't come out of taxpayer money. So they 
are paid for--
    Chairman Jordan. Okay. Well, that is a nice way of saying 
it. I think the taxpayers would say the potential recipient of 
taxpayer-backed financing is paying for the travel of the very 
people who are going to decide whether they get taxpayer-backed 
financing. Such a deal, particularly when it is $3 billion, and 
particularly when you can't account for one-sixth of that--$500 
million.
    Mr. Hochberg. That money is not lost. That money is owed to 
us by Exxon--
    Chairman Jordan. Do you know how much money Exxon Mobil 
spent for those four employees who weighed in on that decision, 
Mr. Hochberg?
    Mr. Hochberg. We sent engineers to do due diligence--
    Chairman Jordan. No, no, no. That is not the question. You 
are not answering the question. How much money did they spend, 
Exxon Mobil, on these four employees who weighed in on the 
decision that ultimately resulted in half a billion dollars of 
taxpayer money going unaccounted for? Do you know how much?
    Mr. Hochberg. The decision is made by the board of 
directors.
    Chairman Jordan. I will tell you. The press says--Bloomberg 
says $97,000--$97,367 for 4 employees. Now, that is over 
$24,000 per employee. So guess where they went? Do you know 
where they went, Mr. Hochberg?
    Mr. Hochberg. They went to Papua, New Guinea.
    Chairman Jordan. Oh, and also London and Tokyo and the 
South Pacific. Paid vacations by the entity getting $3 billion, 
and you all can't account for one-sixth of that money. And yet, 
you think we should just automatically reauthorize this Bank 
with people indicted, people who have pled guilty, and 31 open 
fraud investigations?
    Mr. Chairman, I yield back my last 2 seconds.
    Chairman Huizenga. The gentleman's time has expired. And on 
that note, just because of the size of this, our timing with 
votes and those kinds of things, I am going to stick very 
closely to the 5-minute limit. I will allow people to end 
sentences and those kinds of things. But we are going to have 
to stick to that tight timeframe.
    With that, I will recognize Monetary Policy and Trade 
Subcommittee Ranking Member Moore for 5 minutes.
    Ms. Moore. Thank you so much. I just want to point out that 
the bill that we have introduced really addresses many of the 
issues that you have just raised, Mr. Jordan. Title 5, 
strengthening project monitoring and due diligence. Section 
501, enhanced monitoring and due diligence for structured and 
project finance transactions. And Section 502, monitoring plans 
and post-approval assessment for structured project finance 
transactions.
    And I just want to quickly ask, Mr. Hochberg, do you think 
that will strengthen their hand in terms of the due diligence?
    Mr. Hochberg. I actually do believe we have a good due 
diligence process at the Bank. And we increased our staff on 
asset monitoring in the last year by 33 percent to make sure we 
have even greater oversight of transactions.
    Ms. Moore. I see that the ranking member has just arrived, 
so I am going to ask a really quick question, and then I am 
going to yield the balance of my time to her.
    I am really excited about the American business 
opportunities in Africa. I have been to Africa, and have seen 
some of the really terrible conditions under which these people 
live. And then all of a sudden, I will see this big 
infrastructure project that the Chinese built with their 
resources and their people. China has been in Africa almost 
since the day I was born. And trust me, I am old.
    Can you highlight efforts by GE and others to build 
infrastructure and open that market to Americans before we 
completely get shut out of Africa?
    Mr. Hochberg. As I mentioned, last year we did 192 
transactions in sub-Saharan Africa. But let's be clear, the 
European Union and China far outdistance anything that America 
exports to that market.
    That is, I believe, partly what was behind the mandate to 
encourage more companies to export there, to make sure they 
have the financing, so that we can support more jobs here at 
home.
    Ms. Moore. And what does Africa have going for it? Three 
things: demographics; demographics; and demographics. There are 
an awful lot of people there who need energy, who need 
equipment. And I just don't want to concede that all to the 
Chinese.
    I would like to yield the balance of my time to the ranking 
member of the full Financial Services Committee, Ranking Member 
Waters.
    Chairman Huizenga. Without objection, it is so ordered. 
Ranking Member Waters, you have 2 minutes and 45 seconds.
    Ms. Waters. Thank you very much. I would like to welcome 
Chairman Hochberg.
    Here we are gathered again to discuss issues that ignore 
the central fact that the charter of the Ex-Im Bank is set to 
expire in 26 legislative days unless this body takes action. 
This is serious. And I can assure you that as eager and driven 
as some Republicans are to let the clock run out on the Export-
Import Bank, there are others who are even more hopeful that 
they will succeed. That would be the roughly 60 other 
governments in the world, countries like China and Russia that 
would love to see the Ex-Im Bank disappear.
    The consequences of failing to reauthorize the Bank are 
real on our Nation's competitiveness, on U.S. companies, and on 
the livelihoods of hundreds of thousands of American families 
who work so hard just to make ends meet.
    It is simply shameful that not one single commitment has 
been made by the chairman of the Financial Services Committee 
to take up legislation to reauthorize the Bank.
    I certainly agree with Speaker Boehner's comments this 
morning when he said, ``There are thousands of jobs on the line 
that would disappear pretty quickly if the Bank were to 
disappear.'' To ensure this body gets a vote on the Floor, 
earlier today I joined Representatives Moore and Heck on the 
Financial Services Committee to initiate a discharge petition 
that would bring renewal legislation up for a vote in the House 
if the petition is supported by a majority of the Members.
    I urge all Members to sign on, especially my Republican 
colleagues, for whom this is a chance to stand up for American 
jobs and businesses by rejecting the vocal right wing of your 
party that I really don't believe reflects the values shared by 
many of us here from both parties.
    What we are doing here today isn't about oversight; it is 
about finding excuses. It is about making up reasons to delay 
actions. It is a disservice to the American public that expects 
and deserves better.
    Thank you. And I just want to reiterate to my Republican 
colleagues that no matter how much pressure you may be getting 
from certain quarters, no matter how much you fear your 
Chairman Hensarling, no matter how much you will tend to ignore 
your constituents, you have to stand up and you have to stand 
for something.
    You are adults. I don't know why you would be hamstrung by 
one individual who would tell you what you can and what you 
cannot do. You were elected by the people to represent them. 
You ought to get about the business of doing it. I am sick and 
tired of this.
    And I yield back the balance of my time.
    Chairman Huizenga. The gentlelady yields back.
    At this point, it is my turn to have 5 minutes. And I am 
not going to ask permission of my Chair as to exactly what my 
questions are going to be, because I don't fear him. I look at 
him as a trusted colleague and someone whose advice I lean on 
and perspective I lean on.
    So, Mr. Hochberg, I appreciated your response from our last 
hearing on April 15th. At my request and Chairman Chaffetz's 
request, you did provide a letter to us dated April 23rd, 
laying out some of the issues and some of your plans and some 
of the things that you have undertaken so far.
    On page four of the letter--I did read the letter, and I 
appreciated it--``Workplace Environment'' is the headline. 
``Although employee satisfaction with their workplace improved 
over 2013, favorable ratings were 40 percent below the 
government-wide average.''
    Those are not my words. Those are your words, 
acknowledging, I think, the commonly-known situation.
    We started to dive into it. And I want to explore it a 
little bit more. As we discussed, in this recent survey 
conducted by the Partnership for Public Service on the best and 
worst places to work in government, Ex-Im unfortunately ranked 
26th and is literally dead last, 28 of 28, for effective 
leadership, is the category in the most recent survey of small 
agencies. In that, there was also an amazingly high fear of 
retribution for whistleblowers and things that came out of 
this.
    Additionally, according to the Bank's own 2013 Federal 
employee survey, the Bank's staff have little faith in the 
leadership. When asked if their organization's leaders maintain 
high standards of honesty and integrity, only 42 percent said 
yes.
    When I asked you about this disturbingly low morale and 
faith in leadership, your response was, ``We had a number of 
stresses on the agency, we were under construction for the past 
2 years.'' You highlight that on page four, as well, that the 
employees continue to work in a construction zone. You then 
moved on to say the renovated space is about 20 percent denser 
than the former space. Individual offices are smaller, and more 
employees are sharing open space.
    I have to tell you, when my staff read that, there was 
literally audible laughter. I don't know if you have been in 
any of our offices. My office at 1217 Longworth--I invite you 
to come back to the palatial 213 square feet that encompasses 
my legislative shop, which five people share. That breaks down 
to 42.6 square feet per person.
    And it seems to me that this argument sort of lines up like 
saying well, I guess everybody who is in the Cannon House 
Office Building gets a pass from legislative duties because of 
the construction that is going on. Or since the Capitol is 
under construction and it is harder to get in and out of than 
normal, that somehow we are going to have this pass. And that 
just clearly isn't the case.
    You said your top priority is to improve the workplace 
environment. Specifically, what is your plan to improve 
employee morale, besides you had mentioned having coffee and 
doing some other things like that. Personally, I don't believe 
just having coffee hour with you is going to suffice. It seems 
to me the current course of action hasn't been overly 
successful. So I would like to hear what you have to say.
    Mr. Hochberg. I thank you for bringing that up. And 
obviously, we are not happy with the ratings we have gotten. 
And we are working to improve them. We have enumerated four 
goals for this year, one of which at the top of the list is to 
make Ex-Im a first-tier place to work. We have done a lot of 
management development and training.
    We had about 20, 25 of our senior leadership go through a 
4-day professional development program. We are continuing that 
at different levels of the organization. We are doing more job 
rotation. We are doing a number of things. We are listening to 
our employees. When I say ``coffee,'' it is to listen to their 
concerns--
    Chairman Huizenga. I appreciate that. I have one minute 
left, and I do want to hit on one other thing and I am sure we 
will continue this.
    Why did the Bank approve a $75.8 million loan to a 
subsidiary of the state-owned Industrial Commercial Bank of 
China, when on April 23rd at your annual conference you said, 
``It isn't easy going up against China, Russia, or anyone else 
to win export sales. The jobs come with them.'' You stated, 
``More and more U.S. companies just aren't competing against 
their counterparts in China, Japan, and elsewhere. They are 
forced to compete against China, Inc.''
    Why are we helping?
    Mr. Hochberg. Sir, it is a complicated world out there. 
Some countries--
    Chairman Huizenga. I am very aware of that. But why in the 
world are you helping China?
    Mr. Hochberg. Countries like China are both a competitor of 
the United States and a customer of the United States. Japan, 
Germany, and Korea are competitors and they are customers. So 
in some places we treat them as a competitor, and in other 
places we are selling them goods and services. China is the 
third-largest destination after Canada and Mexico for U.S. 
exports, and we cannot abandon that market.
    Chairman Huizenga. And to hold myself to my own rule, my 
time has expired.
    With that, I will recognize Health Care, Benefits and 
Administrative Rules Subcommittee Ranking Member Cartwright for 
5 minutes.
    Mr. Cartwright. Thank you, Mr. Chairman.
    Mr. Hochberg, I want to quote again the Speaker of the 
United States House of Representatives, John A. Boehner, who 
said that there are thousands of jobs on the line that would 
disappear pretty quickly if the Ex-Im Bank were to disappear.
    And that is what the Speaker of the House said today. 
Chairman Hochberg, have you seen that quotation?
    Mr. Hochberg. I have. Yes, I have.
    Mr. Cartwright. Is it true?
    Mr. Hochberg. Without question.
    Mr. Cartwright. Without question, it is true that thousands 
of jobs would disappear pretty quickly if the Ex-Im Bank were 
to disappear. Those are the words of Speaker Boehner. Do you 
agree, Mr. Hochberg?
    Mr. Hochberg. Last year, we supported 164,000 jobs in the 
United States.
    Mr. Cartwright. How important is it to you that we support 
those American jobs, 164,000 of them?
    Mr. Hochberg. It is certainly important to those 164,000 
people and their families and dependents. So that is a lot of 
families who are supported by these export jobs that we alone 
finance.
    Mr. Cartwright. And it appears to be important to Speaker 
Boehner, as well. So I commend him for those words.
    I also have to apologize. I find myself in a familiar 
position of having overstated the default rate of the Ex-Im 
Bank. The last time you testified I said it was 0.175 and you 
corrected me, it was 0.174. Today, it is even lower. I said it 
was 0.174 today and, in fact, it is 0.167 percent, is that 
right?
    Mr. Hochberg. That is correct. That is the most recent 
report.
    Mr. Cartwright. Again, please accept my sincerest apologies 
for the slander.
    [laughter]
    I want to talk about renewables a little bit. Since 2002, 
Congress has directed the Ex-Im Bank to promote the export of 
goods and services related to renewable energy sources. 
Although it is not explicitly part of the Bank's charter, since 
2008 appropriators have included language directing the Bank to 
make available not less than 10 percent of its aggregate 
authority to finance renewable energy exports.
    Now, Chairman Hochberg, can you please describe how the the 
Bank finances renewable energy and environmentally-beneficial 
exports?
    Mr. Hochberg. Thank you. For one, we apply the exact same 
exacting credit standards for large transactions and small, for 
renewable transactions or other transactions.
    Renewable transactions--according to the Organisation for 
Economic Co-operation and Development (OECD), globally the 
United States and other export credit agencies can extend loans 
as long as 18 years.
    And in fact, Jim Rogers, former chairman of Duke Energy, 
said just recently that we need export credit agencies 
essentially to finance power projects, conventional and 
renewable, because banks will only lend for 5 to 7 years. So we 
provide a longer term to make sure this capital equipment can 
be paid off.
    Mr. Cartwright. Can you describe in detail the procedures 
the Bank has in place to ensure that only well-qualified 
renewable energy projects are approved and taxpayers are 
protected?
    Mr. Hochberg. We do extensive due diligence. As Chairman 
Jordan referred to, we send people out into the field, 
engineers and underwriters, to actually see the project so that 
we are not just relying on a paper representation; we are 
actually seeing it with our own two eyes, walking the site. So 
we review that.
    We work with the State Department, and we work with 
Treasury, to make sure there are no violations.
    And on top of which, in the case of renewable, where they 
are often a 18-year loan, we require a 20-year power purchase 
agreement, so we know there is 20 years of cash flow, more than 
enough to satisfy the terms of the loan.
    Mr. Cartwright. Despite the mandate to devote at least 10 
percent of your aggregate financing to renewable energy 
exports, the Bank has consistently fallen short of that target. 
Chairman Hochberg, why is that?
    Mr. Hochberg. First of all, it is a target, it is not a 
quota. It is simply a target. And frankly, currently, the total 
amount of U.S. renewable exports last year was $1.4 billion. We 
would have had to finance essentially 150 percent of all U.S. 
exports in order to meet that target. So it is a target. It is 
not a quota. It is not someting we do anything unusual to 
reach. It is simply a target that is out there.
    Mr. Cartwright. So what steps is the Bank taking to 
increase awareness of the financing products that are available 
to qualified U.S. renewable energy and environmental exporting 
businesses?
    Mr. Hochberg. We have a team of people who actually do 
business development in that field. Most importantly is getting 
countries to have those 20-year power purchase agreements. We 
have done a lot of work in India because India will sign 20-
year power purchase agreements so we can finance those kind of 
projects.
    India has been very good. In Latin America, we have done a 
lot of wind. In countries like Turkey, which only have year-to-
year, we have done very little work because it is not 
financially--it can't be financed properly.
    Chairman Huizenga. The gentleman's time has expired.
    And with that, I recognize Mr. Mulvaney of South Carolina 
for 5 minutes.
    Mr. Mulvaney. Mr. Hochberg, welcome back. I know that the 
Speaker of the House is very excited about the Democrat support 
he has today for his comments.
    And the comments that have been repeated here a couple of 
times are that, ``But there are thousands of jobs on the line 
that would disappear pretty quickly if the Export-Import Bank 
were to disappear.''
    I think you stated already that you agree with that 
statement, correct?
    Mr. Hochberg. Yes, sir.
    Mr. Mulvaney. And you are hoping that we would rely on that 
statement in making a decision about reauthorizing the Bank to 
the tune of $130-odd billion, correct?
    Mr. Hochberg. Yes, sir.
    Mr. Mulvaney. Okay. By the way, when did you see this for 
the first time?
    Mr. Hochberg. Just a few hours ago, when it came out.
    Mr. Mulvaney. Before you got here, before you left to come 
over here? When did you see this the first time?
    Mr. Hochberg. I just got it at 12:29; it came out at 12:25.
    Mr. Mulvaney. All right. I would hate to think that you 
coordinated with the Speaker's Office on this.
    Mr. Hochberg. I don't think he coordinates with me.
    Mr. Mulvaney. Okay. So let's go back to the statement, 
then. Because you want us to rely on it in making a $130 
billion decision. Thousands of jobs on the line that would 
disappear. How many jobs would disappear, Mr. Hochberg?
    Mr. Hochberg. Last year, Congressman Mulvaney, as I 
mentioned, we supported--
    Mr. Mulvaney. --supported 164,000. I have heard that. But 
how many of those would go away if you went away?
    Mr. Hochberg. It depends on what the demand for our 
services is next year. I obviously can't predict it. It 
depends. We are demand-driven, sir.
    Mr. Mulvaney. You haven't done any studies in your office 
as to how many of those jobs would go away if you cease to 
exist?
    Mr. Hochberg. No. We are demand-driven, sir. First, I 
believe we are going to reauthorize the Bank.
    Mr. Mulvaney. So you don't know if it is 1,000 jobs that 
would disappear or 100,000 jobs that would disappear?
    Mr. Hochberg. The number of companies that rely on us for 
financing may be well boxed-out of foreign sales.
    Mr. Mulvaney. But you don't know if it is at 1,000 or 
100,000?
    Mr. Hochberg. Last year, we supported 164,000--
    Mr. Mulvaney. 164,000, yes, I have that one, Mr. Hochberg. 
We can skip that.
    But you don't know. And when its says ``pretty quickly,'' 
that is pretty loose language, isn't it? How soon would those 
jobs disappear, Mr. Hochberg?
    Mr. Hochberg. A lot of those jobs are in small businesses 
where we provide export credit insurance. And those policies 
will--anything written up to June 30th--
    Mr. Mulvaney. In fact, if you disappear, what is the 
longest loan you have on your books right now? Isn't it like 20 
years, 28 years, something like that?
    Mr. Hochberg. No, no. The longest loans we are allowed to 
make are 18 years.
    Mr. Mulvaney. 18 years. So if you disappear on June 30th, 
there is still going to be an Export-Import Bank presence 
supporting jobs for the next 18 years?
    Mr. Hochberg. But nothing new. Those jobs are--
    Mr. Mulvaney. How much do you spend to support a job, Mr. 
Hochberg? Do you know? Not create a job, by the way. Let's make 
sure we understand each other's language. We have never used 
the word ``create.'' You don't use it, I don't use it. You have 
never contended that you create jobs. You have always contended 
that you support jobs, which is a word that I have never fully 
understood.
    How much do you spend to support an American job?
    Mr. Hochberg. We are self-sustaining, sir. So we actually 
turn money over to the Treasury--
    Mr. Mulvaney. $125,000. You authorized, for those 164,000 
jobs, about $25 billion in authorizations. That is about 
$125,000 a job. You are not very good at this, are you?
    Mr. Hochberg. No, no. We don't cost any money, sir. There 
is a zero appropriation from Congress for the Export-Import 
Bank.
    Mr. Mulvaney. But your loan guarantees were $25-odd 
billion. And with that--
    Mr. Hochberg. And it supported--
    Mr. Mulvaney. --you paid for 164,000 jobs.
    Mr. Hochberg. It is paid for by the users of our services.
    Mr. Mulvaney. Right.
    Mr. Hochberg. They pay--
    Mr. Mulvaney. $125,000 a job.
    Mr. Hochberg. They pay points on a mortgage--like points on 
a mortgage. And that is what it takes--the underwriting, due 
diligence.
    Mr. Mulvaney. Let's talk about your small business jobs for 
a second. I used to be on the Small Business Committee, and we 
had a couple of different definitions for what was a small 
business. What was yours?
    Mr. Hochberg. What was my--say that again, sir?
    Mr. Mulvaney. What is your definition of a small business?
    Mr. Hochberg. For my definition of a small business, I rely 
on the Small Business Administration. They define it for us and 
the entire Federal Government. And it varies industry to 
industry.
    Mr. Mulvaney. It does vary industry to industry, that is 
right. Some places it--
    Mr. Hochberg. A dry cleaner has a different standard than a 
car dealership--
    Mr. Mulvaney. Absolutely.
    Mr. Hochberg. --or another manufacturer.
    Mr. Mulvaney. Is Bechtel a small business?
    Mr. Hochberg. It is a large company, sir.
    Mr. Mulvaney. Did you count it as a small business, Mr. 
Hochberg?
    Mr. Hochberg. Obviously, you are referring to a Reuters 
article in which some companies were miscategorized. It was 
about 3 percent of the total, sir; 97 percent were accurate. We 
had a 3 percent error. We ought to be at 100 percent, but we 
are striving to get there.
    Mr. Mulvaney. Let's talk about mischaracterization. I like 
that word. Because it is not really lying, and it is not really 
telling the truth. Let's talk about mischaracterization.
    If you look at the screen, sir, there is a graph that we 
have drawn up on your small business lending. In your last 
annual report, you said that 25 percent of your total 
authorizations went to small businesses. And that was an 
increase over the previous 2 years. That is represented by the 
red line. Do you see that, Mr. Hochberg?
    Mr. Hochberg. I do.
    Mr. Mulvaney. Look at the total lending that you--the 
authorization that you did to small businesses. That is the 
light blue bar.
    Would you agree with me, sir, that you loaned less money or 
authorized less money to small businesses in 2014 than you did 
in 2013, and less in 2013 than you did in 2012? Your small 
business authorizations have gone down for 2 years in a row.
    Mr. Hochberg. The mandate looks at a percentage of our 
authorizations--
    Mr. Mulvaney. I understand that. I am talking about--I am 
not talking--
    Chairman Huizenga. Time has expired. I will allow him to 
very briefly answer.
    Mr. Mulvaney. I can't do it. Mr. Hochberg, it is always a 
pleasure.
    Mr. Hochberg. Thank you, sir.
    Chairman Huizenga. With that, I should make a note that 
votes have not been called yet. And I am monitoring and 
watching that. But once votes have been called on the House 
Floor, we will recess, and allow Members to vote and come back. 
And I will make an announcement at that time, as well.
    With that, the Chair recognizes the ranking member of the 
full Financial Services Committee, Ms. Waters of California, 
for 5 minutes.
    Ms. Waters. Thank you very much. There is oftentimes a lot 
of discussion about who is getting the support from Ex-Im. And 
there are those who would like to characterize it as subsidies 
for big business. Even though we have debunked that argument 
over and over again, I would like to get a better sense of how 
the Bank indirectly supports small businesses through the 
supply chains of the larger companies that you support.
    For one company alone, they support in my district 152 
small and medium-sized companies. They are part of the supply 
chains. Have you ever tried to quantify the supply chain 
benefits of the financing you provide? How many suppliers, if 
you know, do the larger users of the Bank have across the 
country? If Congress fails to reauthorize the Bank, what impact 
will this have on the thousands of small suppliers across the 
country that indirectly benefit from the Bank's support?
    And finally, am I the only one in the Congress of the 
United States or on the Democrat side who has all of these 
suppliers that benefit from the support of larger businesses by 
the Export-Import Bank? Could you help us out with that, some 
of this information?
    Mr. Hochberg. I am going to try. We work with a lot of 
suppliers. When Boeing or GE makes an export, they are really a 
system, they really are assembling a product. Just the way Ford 
Motor Company assembles automobiles. Ford doesn't manufacture a 
car; it assembles them.
    I visited a company called Tomco right outside of Atlanta. 
They make fire suppression equipment. They are a small 
business. They supply to GE power turbines and export around 
the world. Because of that work, they are now getting strong 
enough that they want to start exporting directly. So 
sometimes, the supply chain helps them actually learn about 
those export markets.
    I visited a company called Click Bond in Nevada that 
provides essentially the--is used in Boeing to attach the skin 
to the structural support of the aircraft. There is a company 
called LMI in Saint Charles, Missouri, also in the supply 
chain. Small businesses, sometimes they are small machine 
shops. There is a company I visited called Ace Aerospace in 
Memphis. Same thing. These are small businesses that are 
directly supplying to larger companies and thereby exporting.
    It is hard to get a precise number, Ranking Member Waters. 
I think it is probably in the range of about another 10 percent 
of our small businesses are in that supply chain.
    Ms. Waters. I would like to just share with you some 
information. It comes from my district, from--let's take a look 
at Hanson Engineering Company. Hanson Engineering Company is 
one of the many small businesses.
    ``Dear Congressman Waters, Hanson Engineering Company is 
one of the many small businesses in the south Bay area of Los 
Angeles, California, that is dependent on Boeing contracts to 
support our business. Hanson Engineering is a manufacturer of 
machine aerospace report parts and assemblies with 90 percent 
of our contracts supporting Boeing aircraft either directly or 
indirectly through our other prime aerospace companies 
throughout the world.
    ``My company staffs approximately 60 employees who live in 
the south bay and surrounding areas and depend upon the support 
of Boeing for the well-being of their families. Without the 
reauthorization of the Ex-Im Bank, it would have a big impact 
on the health of our business, its employees, and their 
families.''
    Mr. Hochberg, you need to know, and I think you do know 
that I have held several meetings in my district with small 
businesses who are directly benefiting from Ex-Im. But I have 
held meetings where the suppliers have come. And these 
suppliers have come to talk about how important it is to 
maintain their businesses. And even though they are small 
numbers of employers--60, 50, 40, what have you--they cannot 
understand what is going on in Congress and why anybody would 
put their businesses at risk this way.
    They wanted to know from me why my colleagues on the 
opposite side of the aisle and, particularly, the chairman, was 
so opposed to the support for suppliers through these 
companies. And I could not explain it. But I asked them to pay 
close attention. Because Mr. Hensarling, my chairman and my 
friend, has absolutely said he wants to close down Ex-Im. He 
wants it to go out of business.
    And so I think that he will probably reiterate that today, 
despite the fact that his leader has said to get something out 
of committee, do something, don't let this Bank expire. And so 
everybody is waiting to see what Mr. Hensarling is going to 
say, what he is going to do, or whether he is out to just kill 
this Bank.
    I yield back the balance of my time.
    Chairman Huizenga. The gentlelady's time has expired.
    And with that, we will let Financial Services Committee 
Chairman Hensarling have his say.
    Chairman Hensarling. I thank the gentleman. Good afternoon 
to the ranking member.
    It is interesting, when you quote one part of the article. 
It is interesting what the headline is on the Reuters article 
concerning the speaker. The headline is, ``Boehner says he 
would support U.S. Ex-Im Bank closure.'' So that is what 
Reuters considers to be newsworthy in the speaker's comments.
    Mr. Hochberg, as always, welcome. And again, you are always 
welcome in the Fifth District of Texas, which you have been 
kind enough to visit. Next time you come, perhaps I could 
suggest where the best cheese and onion enchiladas are to be 
found. It is Matt's in Lakewood, by the way, should you come 
back again.
    You spoke about Ex-Im supporting 100,000-plus jobs. But it 
is interesting, because Delta Airlines says you are costing 
American airlines jobs. Cliff Natural Resources says you are 
costing American iron ore jobs. Valero says that you are 
costing American oil refining jobs. So that is a dubious claim 
on your part of ``supporting jobs.''
    You say you return money to the taxpayers. According to the 
Congressional Budget Office, as you well know, if you use fair 
value accounting, main street accounting, that just about every 
business which you ``support'' uses, you would be costing the 
taxpayer $2 billion over the budget window.
    With respect to the small businesses that the ranking 
member was kind enough to point out to me, well, here is a 
small business. Sonic Air Systems in Brea, California, 40 
employees. Their owners said, ``Ex-Im is arguably another form 
of corporate welfare.'' I understand bigger companies want that 
cheaper money for their customers to buy planes and bulldozers, 
but should the taxpayers fund that?
    Here's another small businessman, Chris Roofer from 
Morningstar company, also in California: ``Ex-Im is a case 
study in corporation welfare. When a company profits from the 
Bank's support, it pockets the money. If it defaults, taxpayer 
pockets get picked. It is private gain at the expense of public 
pain.''
    So that is the voice of small business that many of us are 
listening to, as well.
    I wish to follow up on a question that was asked by 
Chairman Huizenga. I still don't quite get it. So Chairman 
Hochberg, you speak about China, Inc. You frequently talk about 
this and being competitive with China. We had an $18.4 million 
guarantee to the state-owned Ex-Im Bank of China in 2014. Ex-Im 
authorized $292 million guaranteed for state-owned China 
Southern Airlines. In December of 2013, Ex-Im authorized $68.5 
million for Semiconductor Manufacturing International, in 
Shanghai, also state-owned. A $300 million guarantee for state-
owned ICBC Financial Leasing Company.
    Is it your assertion, Mr. Hochberg, that the best way to 
compete with China is to subsidize China?
    Mr. Hochberg. Congressman, we don't subsidize any 
transaction. Customers pay a fee--
    Chairman Hensarling. Well, Mr. Hochberg, I think the 
Congressional Budget Office has a different opinion. I will 
respect your opinion, but I am going to pay a little bit more 
attention to their opinion.
    Since we last spoke, as has been pointed out, at the time 
that you last appeared before us, Mr. Gutierrez had been 
indicted for accepting bribes. He has now pled guilty to 19 
counts of bribery and kickbacks.
    According to the Partnership for Public Service--their 
survey of small government agencies has already been alluded 
to--your employees were asked whether they could disclose a 
suspected violation of any law, rule, or regulation without 
fear of reprisal, and only 50 percent said ``yes,'' which is a 
pretty staggering figure to me.
    Since you have taken the helm of Ex-Im, 65 matters have 
been referred to prosecution, 31 arrest warrants, 85 
indictments, 48 criminal judgments, decades of combined prison 
time, and a quarter of a billion dollars in fines, restitution, 
and forfeiture.
    And when we look at this same group of small government 
agencies, you are almost leading the pack when it comes to 
investigations and when it comes to indictments. At the end of 
the last fiscal year, I believe you had 41 pending 
investigations. The Farm Credit Administration had three. The 
Commodity Futures Trading Commission had zero. The Pension 
Benefit Guaranty Corporation had 24.
    And so when I look at all the various small agencies of 
which you are compared--I believe you have roughly 480-some-odd 
employees, is that correct, Mr. Hochberg?
    Mr. Hochberg. That is correct.
    Chairman Hensarling. You didn't quite get the gold medal. 
Apparently, that goes to the Railroad Retirement Board--
    Mr. Hochberg. --Chairman--
    Chairman Hensarling. --but in the area of small agency--
    Chairman Huizenga. Sorry, Mr. Chairman. The gentleman's 
time has expired.
    Chairman Hensarling. Give me 5 seconds to wrap up.
    In the competition of corrupt and sordid matters, you 
clearly take the bronze medal. And should this agency be 
reauthorized, Mr. Hochberg, I hope you will spend less time 
traveling and lobbying, and more time running the Bank.
    I thank the chairman. I yield back.
    Chairman Huizenga. The gentleman's time has expired.
    With that, the Chair recognizes Mr. Perlmutter of Colorado 
for 5 minutes.
    Mr. Perlmutter. Good afternoon, Mr. Hochberg. It is deja vu 
all over again. Each year your organization makes loans to 
American companies to manufacture goods to sell overseas, which 
basically creates American jobs.
    And my friends on the Republican side of the aisle seem to 
not like small businesses that you loan money to, or medium-
sized businesses that you loan money to. And I have listened to 
them today say they don't like the loans to Bechtel, to Exxon 
Mobil, to Boeing. I don't understand why they hate those 
companies. That makes no sense to me.
    Let's talk about--Mr. Jordan cross-examined the heck out of 
you about this Papua, New Guinea, loan that has been made where 
Exxon Mobil is one of the partners in that job. You used the 
word--you took ``certification'' from Exxon Mobil. Can you 
explain that? He didn't give you the opportunity to answer a 
single question.
    Mr. Hochberg. Thank you. Yes. Exxon Mobil was the project 
sponsor. They certified that the $500 million was incurred and 
expended locally. We rely on corporate officers. I don't 
believe a corporation is going to commit fraud by sending us a 
false certification. They certified those numbers. And as a 
result, that money was loaned. That money will be paid back 
when the project starts. At this point, there is not a question 
in terms of that transaction.
    Mr. Perlmutter. So one of the biggest corporations in the 
world, Exxon Mobil, an American company, certifies to you, the 
lender--or the Export-Import Bank, the lender--that that money 
is going to get paid back?
    Mr. Hochberg. Correct.
    Mr. Perlmutter. Is that what they do?
    Mr. Hochberg. They certify the money is expended and that 
they then will pay it back when the project--
    Mr. Perlmutter. Okay. And as the lender, you rely on that 
kind of certification, do you not?
    Mr. Hochberg. We did, as did all the other lenders in the 
consortium that was involved in the lending. Many other export 
credit agencies--we had the same rights as all the others had.
    Mr. Perlmutter. I look at the same thing that Mr. Jordan 
was asking you questions about. And they say the inspector 
general says in the aggregate, our inspection found that PNG 
LNG, which I guess is a liquid natural gas--
    Mr. Hochberg. Correct.
    Mr. Perlmutter. --facility transaction was well-structured 
and properly documented with Ex-Im Bank confident of full 
repayment. And you are confident of full repayment because you 
have sponsors like Exxon Mobil?
    Mr. Hochberg. Correct.
    Mr. Perlmutter. This is not some fly-by-night organization 
that is certifying to you, is it?
    Mr. Hochberg. No, it is not.
    Mr. Perlmutter. So his questions were really calling into 
question the integrity of Exxon Mobil?
    Mr. Hochberg. Correct.
    Mr. Perlmutter. All right. Let me ask you some other 
questions. You have said that the Bank loans money to American 
companies to manufacture goods to be exported, and that in 
loaning those moneys, companies to whom you have loaned money 
have 164,000 people working for them, is that right?
    Mr. Hochberg. Throughout that supply chain.
    Mr. Perlmutter. So today, I came across something in 
Bloomberg News that as of today, there were 262,000 new jobless 
claims. That is the lowest number of new jobless claims since 
Bill Clinton was President--since April 15th of 2000.
    So is it your belief--and I know you were asked questions 
for specificity--that if you could not make loans to American 
companies, there would be additional job losses?
    Mr. Hochberg. Without question. Let me just say one thing, 
that we don't actually make loans to American companies. We 
provide mostly loan guarantees, insurance. And frequently to 
their customers. But our financing--
    Mr. Perlmutter. Is what allows them to get loans or to--
    Mr. Hochberg. --and to support those exports and support 
those 164,000 jobs.
    Mr. Perlmutter. I also want to let the record reflect that 
in that same article in Bloomberg News, today, under Barack 
Obama, there are 5.13 million jobs unfilled and about 1.7 
million people unemployed. That is the highest number of jobs 
unfilled and the lowest number of unemployed people since Bill 
Clinton was President.
    And so something is going right using Export-Import Bank, 
as well as this Administration, in terms of getting people back 
to work. And my friends seem to want to undercut that.
    I yield back.
    Chairman Huizenga. The gentleman yields back. Just to 
inform everybody, votes have been called. They have just been 
called a moment ago.
    We are going to go to Chairman Chaffetz for his 5 minutes. 
After that, we will recess to allow Members to vote and come 
back. The joint hearing will reconvene upon conclusion of the 
vote series.
    It looks like there are three votes, including a journal 
vote. So if you would do all of us a favor, find your whip and 
tell them whatever question they are asking you, we might get 
that journal vote canceled.
    So with that, Oversight and Government Reform Committee 
Chairman Chaffetz is recognized for 5 minutes.
    Chairman Chaffetz. Thank you.
    Mr. Hochberg, Ex-Im Bank is a Federal entity, right, 
created by Congress?
    Mr. Hochberg. Yes, it is.
    Chairman Chaffetz. So being a Federal entity, do you need 
to abide by the ethics, for instance, that are put forward by 
the Federal Government?
    Mr. Hochberg. And we fully do, sir.
    Chairman Chaffetz. Do you follow the travel policies put 
forward by the Federal Government?
    Mr. Hochberg. Yes, we do, sir.
    Chairman Chaffetz. Do you have the same travel policies as 
other Federal entities?
    Mr. Hochberg. We do, sir.
    Chairman Chaffetz. Do you ever allow Ex-Im employees to 
have their travel paid for by potential clients?
    Mr. Hochberg. For due diligence trips, if we have engineers 
or people actually verifying the work being done, that is 
sometimes paid for by a project sponsor, versus coming out of 
fees from the agency.
    Chairman Chaffetz. And you think that is consistent with 
Federal law and Federal employment practices?
    Mr. Hochberg. My understanding, and on the advice of 
counsel, is that is totally within the confines of the law, 
that we don't incur--that those expenses are paid for by the 
actual project.
    Chairman Chaffetz. So that would be true for potential 
clients as well, correct?
    Mr. Hochberg. When we are doing due diligence before we 
approve a deal. Plus, we don't want to expend funds on a deal 
that may not go through.
    Chairman Chaffetz. Will you provide to this committee a 
detailed listing for the last 6 years of what you have paid for 
and what has been paid for by outside entities?
    Mr. Hochberg. We can do that, sir.
    Chairman Chaffetz. When will you provide that to us?
    Mr. Hochberg. 2 weeks.
    Chairman Chaffetz. 2 weeks. Fair enough. I look forward to 
having that.
    I am going to go to a video here. One of the criticisms 
that we have is your characterization of small business. You 
claim and tout that you do so much for small business. In fact, 
your charter says that 20 percent is supposed to go to small 
business.
    Yet, as I look at that article from Reuters dated November 
14, 2014--I ask unanimous consent to enter that into the 
record.
    Chairman Huizenga. Without objection, it is so ordered.
    Chairman Chaffetz. You have given out some loans to some 
fairly large entities, have you not, that don't fall in that 
category? Let me show you a video. Go ahead and show the video 
here.
    [Video plays.]
    This is you in 2014. Oops. Sorry. We are going to recue 
that and--
    Mr. Hochberg. I am not good at lip reading.
    Chairman Chaffetz. I need some volume.
    This is you talking about SpaceX:
    ``Nearly 90 percent of authorizations directly serve small 
business, another historic high. Gaining access to global 
markets is what empowers small companies to become big 
companies. One of those is SpaceX. And tomorrow, you will be 
hearing from Elan Musk, the visionary CEO.''
    So you think that SpaceX, Elan Musk, is a small business? 
You think that SpaceX is a small business? How do you qualify 
SpaceX as a small business?
    Mr. Hochberg. I said small companies become large. In 
2002--
    Chairman Chaffetz. And one of those is SpaceX.
    Mr. Hochberg. In 2002.
    Chairman Chaffetz. But with the time you are giving out--
you are involved in loans, in 2013 and 2014, totaling $110 
million, you categorize $2.5 million of those as small business 
authorized amounts. And they had employees in the neighborhood 
of 3,000 people. So they may have been a small business when 
you weren't involved with them. But when you did engage with 
them, they weren't a small business, were they?
    Mr. Hochberg. When we characterize a company--it is when we 
make the authorization that we determine--
    Chairman Chaffetz. And you made the authorization in 2013 
and 2014. Were they a small business?
    Mr. Hochberg. No. We didn't characterize them as one--
    Chairman Chaffetz. Yes, you did. You put $2.5 million on 
your listing of that. And this is a pattern. If you look at 
what Reuters has put out, you had more than--according to their 
analysis, more than 200 companies you categorized as small 
businesses that were not. These are businesses owned by GE, 
Warren Buffet, Carlos Slim. There is a lot listed out there. 
And if you look at this chart, there is the authorization. And 
you put roughly $2.5 million in the small business from a 
company that employed over 3,000 people.
    Mr. Hochberg. The data you are refer to from Reuters, there 
were 200 that--
    Chairman Chaffetz. No, I want to talk about SpaceX.
    Mr. Hochberg. SpaceX is not a small business.
    Chairman Chaffetz. But you categorized $2.5 million as a 
small business?
    Mr. Hochberg. I will have to look at that. That is not--if 
that is so, that is incorrect.
    Chairman Chaffetz. Go back then to Reuters. Is Reuters 
wrong?
    Mr. Hochberg. Reuters said--97 percent of the data was 
correct. We strive for 100 percent. Mr. Chairman, we strive for 
100 percent, I ran a company. They found a 97 percent correct 
ratio. We have actually updated as of April 15th our 
applications to get better information so we can supply more 
information on small businesses.
    Chairman Chaffetz. I would appreciate 100 percent 
clarification if you would, sooner rather than later. You have 
overstated this case time and time again. We have seen lots of 
evidence of that.
    With that, I will yield back to go vote on the Floor.
    Thank you.
    Chairman Huizenga. The gentleman's time has expired.
    Okay. We are going to squeeze one more in. And with that, I 
recognize Mr. Green for 5 minutes.
    Mr. Green. Thank you. Mr. Chairman, I believe I heard you 
say Mr. Green from Texas, is that correct?
    Chairman Huizenga. Yes.
    Mr. Green. Thank you very much. And I thank the ranking 
member.
    I would like to yield now at this time to the ranking 
member of the Financial Services Committee, the Honorable 
Maxine Waters.
    Ms. Waters. Thank you very much, Mr. Green.
    Chairman Hochberg, in our last joint subcommittee hearing 
on the Ex-Im Bank, a number of the Bank's critics asserted that 
the Bank is a scandal-plagued institution, and have used this 
excuse to call for the expiration of the Bank's charter in 
June.
    These critics have also misleadingly suggested that because 
there are pending investigations of external actors who were 
seeking to take advantage of the Bank, that this in some way 
reflects in every single case on the charter and integrity of 
the employees within the Bank.
    Can you help set the record straight here? Are most of the 
instances of fraud the result of external actors or Bank 
employees? Do most indictments of external actors result in 
subsequent indictments of Bank employees, as well? What 
policies and procedures do you have in place to minimize fraud 
by Bank employees, as well as the broader public?
    Mr. Hochberg. Thank you, Ranking Member Waters.
    Frankly, in addition, the inspector general said and told 
me that no Bank employees are involved in third-party fraud 
cases he is currently investigating. The 31 cases he is 
investigating are outside companies that tried to defraud the 
government of funds and loans. So these are outside companies. 
Frequently, they are identified by our employees who have seen 
something wrong. But he has also said at the current time, he 
does not believe there is any--he has no reason to believe and 
he does not expect any indictment of the Ex-Im employees.
    Ms. Waters. What evidence do you have to support the view 
that Ex-Im has a strong culture of high ethical standards and 
integrity?
    Mr. Hochberg. The evidence I would support is the fact 
that--and the case we have discussed here, this hearing with 
Johnny Gutierrez--first, it began in 2006: A, before we had an 
inspector general; and B, under President Bush. It came to 
light in this Administration. And he has been indicted and has 
pled guilty.
    And a case like that and others are brought to the 
attention of either the general counsel or the inspector 
general by employees who see something that does not look 
proper and, therefore, warrants further investigation.
    Ms. Waters. I guess you may have alluded to it, but would 
you agree that the inspector general's aggressive approach to 
going after individuals who seek to defraud the Bank is 
actually indicative of a system that works?
    Mr. Hochberg. Without question, I think it is a message to 
everybody when someone like Johnny Gutierrez is not only 
indicted, but pleads guilty, and probably will be sentenced 
shortly.
    Ms. Waters. Okay. There are a couple of things that have 
been said here today in discussion and questions by the 
Members. Would you please recite your percentage of defaults 
that you have? Because I don't think that has been heard.
    And you were actually accused in one of the conversations 
by one of the Members of having--I think he alluded to you 
having high default rates or something. Would you straighten 
that out for us?
    Mr. Hochberg. Absolutely. We report our defaults, as the 
last charter required, as one of the requirements and mandates 
of the last charter, every 90 days. We just sent a report this 
week for the period through March 31st. And it is currently 
0.167 percent. It is actually less than one-fifth of 1 percent.
    Ms. Waters. And I must say something about SpaceX. It 
happens to be in my district. And many Members of Congress on 
both sides of the aisle have commended Mr. Musk and have 
saluted his accomplishments and have talked about how 
futuristic he is in talking about travel.
    I just want to say that I am pleased at the relationship 
that SpaceX has with Boeing and that they are able to supply 
some of Boeing's needs. And it all works very, very well.
    Would you just conclude that SpaceX is a good investment 
and deserves support by Ex-Im?
    Mr. Hochberg. We are very proud to support SpaceX. They are 
competing tooth and nail against a French-government backed, 
and Russian and Chinese-launched vehicles. So frankly, this is 
really good for America. There are, I believe, about 8,000 
employees at SpaceX right now, plus a very vast supply chain.
    Ms. Waters. And lastly, I would like to commend you for 
going out into America and visiting companies to learn more 
about who they are and what they do so that it will enhance 
your ability to make decisions. And so I don't think you can do 
your job without getting out and going to these companies and 
understanding what they do.
    So whatever happens--and I think we are going to 
reauthorize this Bank--I want you to keep going out into 
America and seeing what these companies are all about.
    Thank you. And I yield back the balance of Mr. Green's 
time.
    Chairman Huizenga. The ranking member yields back. The 
gentleman's time has expired.
    With that, votes have been called. We will recess to allow 
Members to vote and come back. The joint hearing will reconvene 
upon conclusion of the vote series. And the subcommittees stand 
in recess.
    [recess]
    Chairman Huizenga. We will let Mr. Hochberg get seated here 
and then we will reconvene.
    So with that, I would like to gavel back in our 
subcommittees. I now recognize Mr. Carter of Georgia for 5 
minutes.
    Mr. Carter. Thank you, Mr. Chairman.
    Mr. Hochberg, thank you for being here again. I believe we 
saw you not too long ago. And as a follow up of the question 
that I had asked you earlier that I just didn't get the answer 
I was looking for, and I want to make sure I understand. And I 
am going to try to be as succinct as I can and ask you to do 
the same. It is a pretty simple yes-or-no question.
    And the question is, does the Ex-Im Bank, in any instance, 
whether you are lending money or whether you are guaranteeing a 
loan or whatever, do you ever participate in a loan that 
results in a lower interest rate than would be available on the 
open market?
    Mr. Hochberg. Congressman, what we do is we provide a 
guarantee. So the banks will determine what the interest rate 
is. We don't determine it. So we make a guarantee, the bank 
pays essentially an insurance premium to us for a guarantee. 
And then they set the interest rate. We don't--
    Mr. Carter. Okay. Wait. Yes or no, do you ever participate 
in a loan that results in a lower interest rate than would be 
available on the open market?
    Mr. Hochberg. Probably in the few cases we do a direct 
loan, they might be. They are intended to replicate the market. 
But could be above, or it could be below. It is an imprecise 
measurement.
    Mr. Carter. So I am going to take that as a yes.
    Mr. Hochberg. I would say sometimes yes, sometimes no. I--
    Mr. Carter. If it is any time yes, that is where I have a 
big problem, let me tell you. Because in my mind--and you 
correct me if I am wrong--the Ex-Im Bank should be a source of 
last resort.
    Mr. Hochberg. Right.
    Mr. Carter. Is that correct? Is that the way you understand 
it?
    Mr. Hochberg. That is exactly the way we run the Bank, sir.
    Mr. Carter. Okay, so whenever someone applies for a loan, 
is that part of the process when you approve a loan? Is it, 
``We have been to three banks before and they wouldn't approve 
it and you are our last resort?''
    Mr. Hochberg. That is correct.
    Mr. Carter. That is correct. Because you are using the full 
backing of the United States Government to guarantee a loan or 
to lend money. And that, in my mind, has a price that goes 
along with it. I am a small businessman. I own three 
independent retail pharmacies. When I go to the bank, I do not 
get the same interest rate that a big company gets. And I 
understand that. I recognize the reason for that.
    But this is what is bothering so many people in my mind is 
that we hear stories about companies that are utilizing the Ex-
Im Bank, and it is resulting in a lower interest rate than what 
they could get on the open market as a source of last resort. 
That is not the way that it is supposed to work.
    Mr. Hochberg. I think what we are referring to is loans 
that are made to buyers of U.S. goods. So when a buyer has a 
choice between goods from the United States or Japan, China, 
Germany, you name it, all of those export credit agencies 
charge the same rate. We all charge the same rate because we 
want to have a level playing field, to let people choose the 
best product.
    Mr. Carter. But again, the point that I am trying to make--
and I think you understand it--is that as a lender of last 
report, that means that the price is higher.
    Now, if I could--and you and I have spoken before and you 
know where I am coming from, because you know that I am 
interested in the fact that you continue to say that you are 
returning a billion dollars to the U.S. Treasury. And I like 
that. Because to me, again, as I have said before, the national 
debt of $18 trillion, even more than that right now, is the 
greatest threat to our national security that I know of. And 
that concerns me.
    And I want to do something to try to get that down. I hate 
to throw the baby out with the bath water. And I don't want to 
do that. If you are generating a billion dollars--and I 
understand what the critics have said. They have said well, if 
you had to use the same accounting principles that are being 
used by the other banks, it wouldn't be that way. Well, you are 
not having to use the same accounting principles.
    So if you are truly returning a billion dollars, I want to 
know--I don't want that to go away. And truthfully, I think you 
can do better. I am here to tell you I don't think you are 
doing your job well enough. If you were to charge the interest 
rate that is due to someone who is getting a loan as a result 
of being the last resort, then it ought to be more.
    Mr. Hochberg. Sir, our job is to support U.S. jobs. That is 
first and foremost. And when we are making--providing a loan 
guarantee or a direct loan for a foreign buyer to buy U.S. 
goods, we are charging the same interest rates as, say, the 
French ECA, the Germans, and others. The Chinese may charge 
even lower. But we are trying to keep competitive so we support 
the jobs here. That is our mandate. Our mandate is about jobs, 
not--
    Mr. Carter. I understand you are trying to be competitive. 
But my point, again, as I have said before, is that as a lender 
of last resort, that comes with a price. And I don't care what 
China is charging. If you have a company that comes to you, and 
you are their last resort, it ought to be more.
    Mr. Hochberg. Frequently, the extra cost comes into the 
fees that are required, like points on a mortgage. On some of 
those projects, we may charge 12 cents on the dollar in terms 
of fees. So the interest rate may be low, but the fees are very 
high in order to--
    Mr. Carter. I understand that. But you can go up on the 
fees so that the interest rate comes out--
    Chairman Huizenga. The gentleman's time has expired.
    Mr. Carter. Thank you, Mr. Chairman. I yield back.
    Chairman Huizenga. With that, the Chair recognizes Mr. Heck 
of Washington for 5 minutes.
    Mr. Heck. Thank you very much, Mr. Chairman.
    Chairman Hochberg, thank you so very much for being here. 
Indeed, thank you for your public service, sir.
    I think most of us have a fairly firm grasp, or at least an 
intuitive grasp, about how it is Ex-Im interacts with larger 
businesses. But I think it would be instructive for this 
conversation for you to elaborate a little bit on how they 
interact with smaller businesses, be it traffic cones or mint 
extract or pickles. And the products.
    And the reason I am asking this question is I have been 
involved in a lot of these conversations. And it always seems 
like an ``aha'' moment when they realize it is not always just 
a direct loan that fuels sales and growth. So maybe you can 
talk briefly about those products, sir.
    Mr. Hochberg. Certainly. For our small business clients, 
the two products they primarily use, though not exclusively, is 
credit insurance, which is similar to fire and theft insurance, 
where they get insurance to cover their overseas receivables so 
they can ship goods. Like Jenny's Pickles, as an example. They 
will make the shipment on an open account and get paid, say, 60 
days later. So that is one product we provide. And many 
insurance companies have very high minimums and they won't take 
some of these small clients.
    The other one is working capital loans. We provide a 
working capital loan for a number of companies whereby they get 
the cash, we guarantee a bank up to 90 percent to induce the 
bank to make that working capital loan so that they can buy the 
raw material so that they can essentially assemble the goods, 
and extend the credit to their customer.
    Those are the two primary products we provide to small 
businesses.
    Mr. Heck. So do you apply the same standard of, that those 
products must be--you must be the last resort for those 
products, as well?
    Mr. Hochberg. In both cases, both the insurance--usually, 
an insurance broker is bringing us in and saying okay, can I 
use the private sector or Ex-Im? So they are working with their 
broker to do so.
    It is the same with the bank. The bank, if they could make 
the loan on their own, they would. They only call us in, 
frankly--there is additional paperwork, additional 
transparency, and additional scrutiny when you work with a 
government agency. So if the bank can do it on their own, they 
prefer to do it on their own. They come to us when the risk 
level is just outside of their normal risk parameters.
    Mr. Heck. So, Mr. Hochberg, that begs the obvious question 
about some of these working capital loans. It is my 
understanding that these are generally for 1 year?
    Mr. Hochberg. Generally speaking, they are for 1 year.
    Mr. Heck. And if the Bank expires on June 30th and if these 
working capital loans are of the last resort and therefore have 
been made available only through you, what is going to happen 
to those small businesses when they hit the 365th day? And do 
you have any sense about the number who currently have working 
capital loans?
    Mr. Hochberg. The working capital loan--I will give you one 
example, actually, in Ranking Member Waters' district, a 
company called Ceilings Plus owned by a woman named Nancy 
Mercolino. She provides the ceiling to the Doha Airport. She 
used our working capital loan to support that export, because 
she had to assemble all that material, ship it over to the 
airport, get it installed, and then get paid. She needed the 
working capital to keep that company going. And she has been a 
very extensive user of our working capital loan.
    On the 365th day, the problem is we would not be there to 
guarantee that loan. And that has made a number of banks very 
anxious about extending working capital loans while this bill 
is being debated, because they don't want to be in a position 
when they don't want to have a--they are concerned about how 
that company will pay back that working capital loan when we 
are not there to guarantee it.
    Mr. Heck. Do you think there would be a consequence to 
employment levels for those companies?
    Mr. Hochberg. I do. And I will read you a quote from a 
customer, Don Nelson, who was on the letter the U.S. Chamber of 
Commerce sent. And he said, ``This is Don Nelson, from ProGauge 
Technologies in Bakersfield, California. Nobody is going to 
take the place of Ex-Im. We are already working with a private 
bank. Without Ex-Im, we wouldn't have the collateral required 
for our project and revenues would go down by about 75 percent. 
I would have to lay off between 50 and 60 people. Ex-Im is 
critical to our business.''
    Mr. Heck. I am glad you referred to some of those addendum 
quotes to the letter from the Chamber. Because it is not clear 
to me that those were necessarily entered into the letter with 
the broader letter. But some of them are very instructive. They 
are all basically small businesses.
    And I just might point out that we are virtually on the eve 
of national small business week next week. A couple I found 
particularly instructive, for example, A.J. Rose Manufacturing 
in Ohio: ``We have used Ex-Im loan guarantees to build our 
business for engine parts. Normally, banks will not extend 
loans to cover a small company's overseas orders. But Ex-Im's 
guarantees allow us to do that. With those guarantees, we 
exported an additional $2.7 million in engine parts and hired 
19 people.''
    Davenport Aviation, low and behold also in Ohio: ``We are 
in turbo growth right now and we need cash. Cash life cycles 
can be long when dealing with markets in developing 
countries.'' It was Ex-Im that he points to as the reason for 
the success and the growth.
    NOSHOK, Inc.--I am pretty sure I butchered that--also from 
Ohio: ``Ex-Im provides loans, loan guarantees, et cetera. It 
helps level the playing field for U.S. companies seeking new 
sales in fiercely competitive global markets. I urge Congress 
to support Ex-Im's swift reauthorization.''
    Nearly 90 percent of your activity and transactions are for 
small businesses on the eve of national small business week. I 
literally pray that we reauthorize the Bank. Thank you.
    I yield back the balance of my time.
    Chairman Huizenga. The gentleman's time has expired.
    With that, the gentleman from North Carolina, Mr. 
Pittenger, is recognized for 5 minutes.
    Mr. Pittenger. Thank you, Mr. Chairman. I yield to the 
chairman of the full Financial Services Committee, Chairman 
Hensarling.
    Chairman Hensarling. I thank the gentleman for yielding.
    Chairman Hochberg, you have been speaking about Ex-Im's 
mandates. So we have mentioned the green energy mandate, the 
renewable mandate, the sub-Saharan small business.
    But you also have guidelines on high carbon intensity that 
many have dubbed the ``no-coal rule.'' In the Bank's press 
release dated December 12, 2013, you said, ``I strongly support 
the Administration's efforts to build an international 
consensus such that other nations follow our lead in 
restricting financing of new coal-fired power plants.
    Now, as opposed to your other mandates, the no-coal 
mandate, Congress did not vote on that, correct?
    Mr. Hochberg. Congress voted on an environmental standard 
that was put in 23 years ago into our charter, sir.
    Chairman Hensarling. Okay. Where did the no-coal policy 
come from? Because you were the one who announced that on 
December 12th, 2013. It had not previously been imposed, 
correct?
    Mr. Hochberg. We actually support coal mining equipment, we 
support coal exports, we support coal-fired power plants in 
poor countries.
    Chairman Hensarling. Well, in poor countries. But in other 
countries, you do not. So I understand the asterisk. But the 
bottom line is you, and I assume your board, unilaterally made 
the decision not to support the other coal financing projects, 
correct?
    Mr. Hochberg. The board reviewed it and--
    Chairman Hensarling. Did Congress vote on it?
    Mr. Hochberg. The Congress voted an environmental standard. 
The Bank--
    Chairman Hensarling. So that is where you draw your 
authority from?
    Mr. Hochberg. The Bank was sued under the Bush 
Administration for not applying the environmental standard 
sufficiently. And in the consent agreement--
    Chairman Hensarling. Oh, I know there are lots of groups 
that sue frequently. So I understand that. But the bottom line 
is Congress did not pass a standard to prohibit you from 
financing coal-fired projects.
    Mr. Hochberg. Congress passed a statute that we had to take 
the environment into account. And we were sued--
    Chairman Hensarling. Okay. So you also talked about how 
this leads to a question of balance, I think is the word. Yes. 
You said, ``The Bank engages in an important balancing act in 
supporting our exports, and weighs potential impacts of the 
environment associated with our financing.''
    So if you and the other board members decide to do another 
important balancing act, you can make other decisions. For 
example, to have a no-petroleum policy, I presume. I understand 
what Congress passed with their renewable mandate. But that is 
not the mandate we are talking about, is it?
    Mr. Hochberg. We actually support the oil and gas industry. 
It is one of our largest--
    Chairman Hensarling. No, but you could make the decision 
based upon the earlier authorization. And as you have decided 
to essentially do a no-coal policy, you could make the decision 
to do a no-petroleum policy.
    Mr. Hochberg. We don't have a no-coal policy, sir.
    Chairman Hensarling. Okay. With the exception of poor 
countries. How about a mostly no-coal policy? The bottom line 
is Congress didn't authorize it, Mr. Hochberg. You decided to 
do it.
    Mr. Hochberg. Congress put it in our charter 23 years ago. 
The Bank was sued before I got there. And part of the consent 
degree before I got there was--
    Chairman Hensarling. Okay. Well, again, you were the one 
who came out with the statement. So I am just asking you to 
think about this particular hypothetical. Coming from Texas, it 
could be that November after next, we may be, at least in my 
state, celebrating the election of either President Perry or 
President Cruz. And say we appoint a new head of the Ex-Im Bank 
and new board members. At that point, I assume nothing would 
prevent that head of the Ex-Im Bank giving the authority you 
have assumed to say that Ex-Im Bank can no longer offer 
assistance to build any clinic that intends to provide 
abortions.
    Under the same authority, I assume then the Bank could 
decide it will no longer provide assistance to countries that 
limit Second Amendment rights because maybe somebody sued the 
Ex-Im Bank. Maybe they decide that they will no longer extend 
credit to countries that have debt-to-GDP ratios worse than 
ours, although I don't think there are many on the list at the 
moment.
    So again, this is not a congressional mandate. This is one 
that you and the board decided to do. And I just wanted to 
point out to all Members that once Ex-Im assumes this 
authority, it is Katy-bar-the-door on self-imposed mandates of 
political lending, ideologically-based lending. And that can 
cut both ways. That is the main point I needed to make.
    Mr. Chairman, I thank the gentleman from North Carolina. 
And I yield him back his 1 second.
    Mr. Pittenger. And I yield back.
    Chairman Huizenga. And the gentleman's time has expired.
    Seeing no Democrats at this time who have not been 
recognized for the first round, we will go to Mr. Gowdy from 
South Carolina for 5 minutes.
    Mr. Gowdy. Thank you, Mr. Chairman. Chairman Hochberg, I 
was a very mediocre lawyer in a previous life. But I was 
mediocre for a long time, which means I got to watch lots and 
lot of juries. And I look in 2012 and I see that 330 Members of 
Congress voted to reauthorize the Bank. And now I talk to my 
colleagues. And trust me when I tell you this, it is on life 
support.
    So how in the course of 3 years could you go from a three-
to-one majority in the people's House and then be on life 
support? What happened?
    Mr. Hochberg. Sir, I am not sure I am in the position to 
answer that question--
    Mr. Gowdy. If you can't answer that question, then you 
might as well call the coroner. You are the one that people are 
going to be looking to.
    So let's start with this. I think you will agree with me 
that there are three categories of folks, generally. There are 
folks who are going to be opposed to the reauthorization for 
very principled reasons, many of whom are my friends. They have 
just--they have made up their minds. And there are going to be 
folks who are going to vote for reauthorization no matter what. 
No matter how many indictments, no matter how many anything.
    And then there is a group in the middle who would like to 
vote for reauthorization, provided there was some reforms. And 
that is the group in 2012 that gave you a 330-person vote. So I 
think what they are looking for is, how are you doing on the 
reforms? How did you do for the last 3 years on the legally-
mandated reforms?
    Do you agree that Chairman Hensarling is a reasonable 
person who would be open to factual persuasion?
    Mr. Hochberg. He is smiling. I will let the chairman decide 
that question.
    Mr. Gowdy. No. I am asking you. Because you have Chairman 
Hensarling, you have Chairman Ryan, you have Kevin McCarthy, 
all of whom--even though I am on the opposite side of the issue 
from them, I find them to be open to factual persuasion, or at 
least they will give me an audience, they will at least let me 
make the case.
    So what is the case that you did what Congress asked you to 
do in 2012?
    Mr. Hochberg. When I was here just 2 weeks ago, I 
enumerated every reform that was put in, in 2012. And I 
enumerated--and I am happy to do again--each report and each 
change that was asked for and the date we did that. So we have 
complied with each and every reform of the 2012 reauthorization 
act.
    Mr. Gowdy. All right. I want to just start with one reform 
that I remember a lot of my colleagues discussed, which is the 
eventual goal of winding down the Ex-Im Bank.
    Mr. Hochberg. That responsibility was given to the 
Secretary of the Treasury.
    Mr. Gowdy. Who, by the way, was among the most dreadful 
witnesses from whom I have ever had the displeasure of hearing 
testimony. And he, honestly, right now is the best argument 
against reauthorization. So I am glad that he is not with you.
    Can you make the case that Treasury has done what we asked, 
that it is a high priority that the Bank be wound down?
    Mr. Hochberg. I can say the following, sir. I am actually 
meeting with--I have met with my colleagues just about a month 
ago, I am meeting with some more colleagues in the next 10 
days, to talk about exactly that subject. Because I have 
decided I take the will of Congress seriously. I am talking to 
my colleagues about what do we do about winding this down.
    Mr. Gowdy. You can count as well as I can count. And 330 
was a good, strong vote. Now, we are struggling to get to 218. 
And if you do get to 218 this time and the reforms are not 
implemented that lots of my colleagues want to see implemented, 
then it won't even be close in a couple of years.
    So I don't mean to put undue pressure on you, but the 
follow up from the Treasury is not going to help. Unless they 
send somebody else from the Treasury, that one is not going to 
help. You are going to have to make the case sometime between 
now and the expiration date of how you are doing what Congress 
asked you to do in 2012.
    Mr. Hochberg. All the reforms that this committee has asked 
us to do at Ex-Im Bank--and there were more than a dozen--we 
have complied with, whether it is the Federal Register, whether 
it is a full report to Congress, whether it is an expansion in 
textiles. Each one of those reforms, I enumerated at this 
committee hearing 15 days ago--
    Mr. Gowdy. Okay. But Mr. Chairman--
    Mr. Hochberg. --Treasury Department, it is outside of my 
authority.
    Mr. Gowdy. I am with you. But you and I are watching the 
jury together. And we have gone from 330 to life support. So we 
can quarrel and quibble over whose responsibility that is. 
Maybe the Treasury. Maybe not the Treasury. But you have to 
make a really compelling case between now and the expiration 
date or we may not get to 218.
    Mr. Hochberg. We do have--Congressman Fincher has a bill 
with close to 60 cosponsors. Ranking Member Waters has a bill 
with 190 cosponsors. There are 250 on those two different 
bills. They are not identical, but 250 cosponsors between those 
two bills just to start with.
    Chairman Huizenga. The gentleman's time has expired.
    Mr. Gowdy. Yes, sir.
    Chairman Huizenga. Again, seeing no colleagues on the 
Democrat side who have not had their opportunity to ask a 
question in the first round, we will go to Mr. Schweikert of 
Arizona for 5 minutes.
    Mr. Schweikert. Thank you, Mr. Chairman.
    And some of the mechanical questions. Let's do something 
that we would find interesting, or some of us would. Discuss 
with me the definition you would use for ``impairment'' of both 
guaranteed debt and actual debt you have extended. Because you 
keep using ``default.'' And I am not after default. I am 
asking, what is impairment? Is it when there is a violation of 
reps and warrants, when a payment is delayed? Give me a 
definition of what you use as impairment.
    Mr. Hochberg. We report our defaults to Congress.
    Mr. Schweikert. I am not asking defaults. One more time. 
Impairment, just like every other institution has to do with 
when there is a violation of reps and warrants. I have already 
looked through the statements. And you used some very 
interesting definitions. So walk me through why your 
definitions are so different than the rest of the world.
    Mr. Hochberg. When we issue a default report to Congress--
    Mr. Schweikert. Not default. One more time. Impairment.
    Mr. Hochberg. In that report, we have an aging report. We 
have amounts that are overdue, that are not in default, they 
may be in technical default.
    Mr. Schweikert. Okay. So when I looked at your report and I 
started saying, here is my violation of reps and warrants, 
where do I find that line on there?
    Mr. Hochberg. I will have to get back to you on that.
    Mr. Schweikert. When I go through your reports and I look 
for where I find the number of folks who--excuse me--the number 
of debt you have outstanding that have missed a payment, are 
delayed in the payment or have not fully paid the payment, 
where do I find it?
    Mr. Hochberg. We have an aging report that is--
    Mr. Schweikert. Not aging.
    Mr. Hochberg. This indicates when someone is in arrears: 
less than 30 days; 60 days; 90 days; or 150 days.
    Mr. Schweikert. And within there, I can see where it is 
saying this is part of the scheduled agreement within the reps 
and warrants--
    Mr. Hochberg. No. They are overdue.
    Mr. Schweikert. Okay. So when you are marking it as a 30-
day delay, that is absolute impairment on there?
    Mr. Hochberg. That is impairment. But then we are looking--
    Mr. Schweikert. So if I were to look at your complete loan 
book right now of everything, what is your actual percentage of 
all impairments and all reps and warrants violations?
    Mr. Hochberg. I will get back to you. I am not going to, I 
don't want to speculate--
    Mr. Schweikert. --it borders on almost sort of a fraudulent 
discussion around here when we say well, we only have this 
percentage of default, but if I had a money center bank here, 
you all know, all of you from the banking business, we would 
not be talking about default. We talk about impairment on the 
book.
    Mr. Hochberg. The report we send to you, sir, GAO has 
approved that it is consistent with congressional intent and we 
are following the law. So we are reporting--
    Mr. Schweikert. Okay. No, no, no, no. I look forward to you 
going through it and walking me through the numbers. Because I 
have dug. I have a 5-hour flight home. I have taken your stuff 
and dug and tried to understand where--because it doesn't look 
the same as every other money center institution I would look 
at how they would provide me with that data.
    Could you walk me through just a couple of other mechanics, 
just so I understand? How much of your book right now is direct 
loans, and how much of is it actually enhancements, guarantees?
    Mr. Hochberg. I will give you a number off the top of my 
head. I don't have that number memorized.
    Mr. Schweikert. Okay. Just give me your best guess.
    Mr. Hochberg. Roughly speaking--
    Mr. Schweikert. And I won't hold you to it.
    Mr. Hochberg. Roughly speaking--and I will confirm this in 
writing--it is about 10 percent of our loans are direct and the 
rest are guarantees.
    Mr. Schweikert. Okay. So I am holding 90 percent over here 
are enhancements. Now, on much of the enhancements you are 
doing, you are doing actually 90 percent of the liability 
ladder?
    Mr. Hochberg. No. Well, banks pay us a fee. They pay 
essentially an insurance fee--
    Mr. Schweikert. Look, everyone in this room understands 
mortgage insurance and those things. And so we are all 
familiar. So you are covering the top 90 percent of the 
liability?
    Mr. Hochberg. No. We provide a 100 percent guarantee.
    Mr. Schweikert. Oh, you do a 100 percent guarantee?
    Mr. Hochberg. And they pay a fee for that.
    Mr. Schweikert. Okay. So unlike any other loan enhancement 
I have ever heard of, you are guaranteeing 100 percent--
actually, the American taxpayers are ultimately guaranteeing 
100 percent of that. Now, on your syndication, do you do any 
syndication of that risk?
    Mr. Hochberg. Currently, we are part of larger 
syndications, but--
    Mr. Schweikert. Okay. But--
    Mr. Hochberg. --our loan book, we do not syndicate our 
loans.
    Mr. Schweikert. No, no, no, no. I only have, like 40 
seconds--
    Mr. Hochberg. We do not--
    Mr. Schweikert. --I wish we had more time because this is--
    Mr. Hochberg. I would be happy to come to your office--
    Mr. Schweikert. But the syndication of your risk to private 
entities is how much of that 90 percent of your book?
    Mr. Hochberg. The loans that we guarantee, we guarantee 100 
percent of those loans to foreign buyers.
    Mr. Schweikert. That wasn't the--how much of then that 90 
percent, on the 90 percent, are you syndicating the risk to 
outside entities?
    Mr. Hochberg. We do not syndicate to outside entities.
    Mr. Schweikert. Why?
    Mr. Hochberg. We have--
    Mr. Schweikert. There is a vibrant syndication market out 
there of doing enhancements. So remember, there is another 99 
percent of our Nation's exports that go out with surety bonds, 
and other types of exports credit. So there is this robust 
world out there happening. Why aren't you reaching out and 
participating in some of that?
    Mr. Hochberg. Because generally speaking, we are in the 
deal because the private sector cannot--
    Mr. Schweikert. Even if you were taking part of the ladder 
of risk, they wouldn't participate?
    Chairman Huizenga. The gentleman's time has expired.
    Mr. Schweikert. I'm sorry. I know I am over, Mr. Chairman. 
But it is an interesting question of why they don't 
participate.
    Thank you, sir.
    Chairman Huizenga. Thank you. We are hoping to do a second 
round, so if you want to stay close, you might have another 
chance.
    With that, we will go to Mr. DeSantis of Florida for 5 
minutes.
    Mr. DeSantis. Thank you, Mr. Chairman.
    Good morning, Mr. Hochberg. I noticed that Ex-Im 
beneficiaries have donated to the Clinton Foundation. Was there 
any communication between Hilary Clinton when she was Secretary 
of State and you or your staff about any authorizations?
    Mr. Hochberg. Not that I recall.
    Mr. DeSantis. Would you be able to check and get back to us 
about that on the staff level?
    Mr. Hochberg. We would be happy to.
    Mr. DeSantis. Okay. Thank you. The survey in 2013--I think 
you have been asked about this at previous hearings. But 50 
percent of the employees at the Bank said that--only 50 percent 
said they were free to disclose a suspected violation of any 
law, rule, or regulation without fear of reprisal.
    Do you think that that culture is problematic and is linked 
to some of the instances that have been discussed where there 
may be impropriety?
    Mr. Hochberg. In each case where there has been some 
impropriety--and let me remind everybody that in all but four 
cases, they are outside of the Bank, they are customers and 
companies trying to defraud the U.S. Government--they were 
identified by and large by employees who saw something that was 
suspicious and brought it to someone's attention.
    Mr. DeSantis. Very well. Understood. People were going to 
try to look at different data about the Bank earlier in this 
year. Because I guess you had listed the Bank with the funds. 
But then the data was removed without warning. So one, what was 
the reason for that? And two, has the data been put back up?
    Mr. Hochberg. All of the data has been put back up. It was 
down for about 2\1/2\ weeks. This was a government regulation 
that goes back to 2007-2008 where we posted data, and it came 
to our attention that a customer, an exporter, felt that there 
was too much business confidential information on the Web. We 
took the data down, reviewed it, and we made adjustments so we 
would not hurt any U.S. exporter, at the same time trying to be 
transparent. And so we are trying to balance those two.
    Mr. DeSantis. Understood. The Ex-Im authorized more than 
$450 million in loan guarantees for First Solar, which I guess 
was selling, as I understand it, solar panels to itself. So how 
do those transactions and that setup benefit U.S. exports?
    Mr. Hochberg. Every transaction that--if there is a related 
part, they are all done at an arm's length transaction. This 
was a company set up in Canada. It was a special purpose 
vehicle (SPV) that was then going to sell power to the Canadian 
grid. That was approved by the Bank. In fact, at the end that 
bank, we did not disburse that loan. That loan, the project was 
able to secure private sector financing, which we were happy to 
do. And so we never implemented that loan.
    Mr. DeSantis. There has been talk with the impending 
reauthorization that if the Bank is not reauthorized, you have 
a lot of transactions that have been done, and that somehow the 
jobs linked to Ex-Im financing are ``at risk.''
    But as I understand it, if the Bank is not reauthorized, 
that does not shut down any of the current streams of financing 
that have already been authorized, correct?
    Mr. Hochberg. Well, yes. If we have authorized a loan, we 
have made a firm commitment and we will execute that. We will 
not do any new loans.
    Mr. DeSantis. Exactly. So any of the jobs that are 
specifically linked to the financing that has already been 
done, if people are saying that it is going to cost jobs, they 
have to put that aside and show how without having the Bank 
operating, originating new loans, then how that would cost 
jobs. But you can't say that the jobs that are linked to the 
current financing are going to be in jeopardy, is that correct?
    Mr. Hochberg. Right. The quote I read about Don Nelson in 
California said that he would have to lay off between 50 and 60 
people if Ex-Im Bank Bank is not there. That is just his quote.
    Mr. DeSantis. But what he is saying is that he wants to 
have the financing for future deals.
    Mr. Hochberg. For future transactions.
    Mr. DeSantis. And he is, I guess, implying that there will 
not be financing on the private market for those transactions. 
And I think that is a matter that is subject to dispute. I know 
you would probably agree with him. I know many members of the 
panel would think that you may see that.
    But I appreciate your testimony. I have a little bit of 
time left, but I will go ahead and yield back, because I know 
some people want to get in round two.
    Chairman Huizenga. The gentleman yields back.
    And again, seeing no new Members on the Democrat side of 
the aisle, we will continue on the Republican side with Mrs. 
Love of Utah for 5 minutes.
    Mrs. Love. Thank you, Mr. Chairman.
    I have a couple of questions. I am new here, so you are 
going to have to help educate me on some of these things. Is it 
your goal to wind down the Bank so that the private sector can 
participate in some of the export finance?
    Mr. Hochberg. Our goal is to fill in gaps in the private 
sector. During the financial crisis, we were called to do more 
of that.
    Mrs. Love. Did you ever talk about winding down the Ex-Im 
Bank?
    Mr. Hochberg. No, I didn't talk--
    Mrs. Love. In 2012, you never talked about getting to a 
point where you can wind down so that the private sector can 
take up more of the export financing?
    Mr. Hochberg. We step back when the private sector steps 
forward. That is why our loans are off by almost 50 percent 
from 2 years ago.
    Mrs. Love. But you never talked about winding down the Bank 
at all?
    Mr. Hochberg. I guess I don't--maybe I don't fully 
understand the question, then.
    Mrs. Love. Oh, okay. Well, that is interesting. Because I 
have all sorts of memos here that talk about what you are 
required to do, what the reauthorization in 2012, how you got a 
broad support and things that you had promised that you were 
going to do. And one of the things that you talked about was--
one of the things that was discussed was winding down.
    Mr. Hochberg. The Treasury Department was called to do that 
if the Bank is not reauthorized.
    Mrs. Love. Okay. So I am trying to figure out what the 
goal--how do you reach that goal so you are not in direct 
competition with our private sector here?
    Mr. Hochberg. Exactly. We are brought in, in almost every 
single case, by the private sector. A bank says to their 
customer, we can't make this loan unless we get a guarantee. An 
insurance broker says, I can't find you private sector 
insurance, let's go to the Export-Import Bank.
    So it is private sector insurance brokers, private sector 
banks that say we need to guarantee a loan because we cannot 
make the loan on our books without it.
    Mrs. Love. Okay. So do you have a set of steps, a set of 
stages, different things that you can actually give to this 
body for perusal on how you are going to get to that goal to 
allow some of the private sector to get into this?
    Mr. Hochberg. The private sector is in every one of those 
deals. So they bring us in. The private sector says we need a--
    Mrs. Love. Do you have any goal at all to limit your 
footprint in this market? Or do you have a goal to expand it?
    Mr. Hochberg. No. I have tried to say, our loan volume is 
running almost half what it was 2 years ago because there is 
less need for us today.
    Mrs. Love. Okay, so over a 6-year period from 2008 to 2014, 
the Bank's outstanding financial commitments nearly doubled, 
growing from $59 billion to $112 billion. This unprecedented 
growth has been attributed largely to the financial crisis and 
resulted as a retreat of the private sector lending from that 
market.
    I have a problem with that. I think the biggest problem 
that we have with Ex-Im Bank is that it is not listening to 
Congress, not implementing the reforms that it has said that it 
would implement. And I would like to talk about something else 
before I lose my time.
    Advocates for the Bank like to point out that the Bank is 
needed to counter foreign competition, that is to say that 
foreign ECAs, counter foreign ECAs, thereby leveling the 
playing field for U.S. companies. Yet, according to the Bank's 
own data, only about a third of the Bank's activity is 
characterized as countering foreign competition.
    So does that mean that two-thirds aren't to counter foreign 
competition?
    Mr. Hochberg. No, the other two-thirds are filling in the 
gap when the private sector won't make the loan.
    Mrs. Love. Okay.
    Mr. Hochberg. For example, in sub-Saharan Africa, there are 
very few private banks that will do a deal with Africa. That is 
why we have such a large portfolio in sub-Saharan Africa.
    Mrs. Love. Okay. Again, I am having a really hard time 
here. The biggest problem--when everybody asks me what is the 
biggest surprise, the biggest surprise is that entities like 
this aren't accountable to Congress. They don't keep promises 
that they make. And then they come back and they say yes, we 
need your reauthorization. We understand that we are in 
trouble, we understand that there is all sorts of fraud going 
on. But we need you to trust us.
    When do we get to the point where we trust the American 
people again--
    Mr. Hochberg. We have complied with every single--
    Mrs. Love. --to fill in the gaps?
    Mr. Hochberg. --every single requirement that this 
committee has asked us to do. And I enumerated that in the 
committee hearing 2 weeks ago.
    Mrs. Love. Okay. Here is what I am saying. I just got a 
text from my 15-year-old. She has eight classes that she is 
taking right now, and is getting seven As and one C. And right 
after that text that she said to me, ``Mom, by the way, don't 
worry, I am getting that C up. It will be done by the end of 
the year. I am making up this paper, and this is a plan, and I 
will have straight A's.'' Great. There is a plan from a 15-
year-old. I think we can do a better job in making sure that we 
are showing a clear plan on how we are going to limit our 
footprint and allow the private sector to become more involved 
in what we are doing here.
    Thank you. I yield back the remainder of my time.
    Chairman Huizenga. The gentlelady's time has expired. I 
will now recognize Mr. Ellison from Minnesota for 5 minutes.
    Mr. Ellison. I would like to thank the chairman and the 
ranking member for the time.
    Sir, welcome to the committee. And we do appreciate your 
presence here and do want to observe that it is the protocol to 
be respectful to all of the witnesses who appear before us. So 
I want to let you know that I personally make that commitment. 
Thank you for your presence, and thank you for your hard work 
on behalf of the American people.
    Mr. Hochberg. Thank you.
    Mr. Ellison. If Congress didn't reauthorize the Ex-Im Bank, 
would there be a job impact? I don't want to put you on the 
spot and ask, how many jobs? Because, of course, if you know, 
that is fine. But I wouldn't expect you to know. But would 
there be a job impact? And can you kind of describe what it 
might look like?
    Mr. Hochberg. It would be a large impact. Last year, as I 
mentioned, we supported 164,000 jobs. I read a letter from Don 
Nelson that talked about laying off as many as 50 to 60 
employees. I visited a company in the State of Illinois, the 
Matthews Company, that makes grain silos. With our support, 
instead of laying people off in the winter months when there is 
not a demand in the United States, they do exporting.
    So sometimes I get questions about support. That way, he 
keeps his employees year round on a 12-month basis versus 
having to lay them off 4 or 5 months a year. So all those jobs 
would go out the window.
    Mr. Ellison. Do you think there would be an impact in the 
manufacturing sector?
    Mr. Hochberg. This grain silo is a manufacturer. Don Nelson 
is a company that manufactures. I was talking to Congressman 
Gibbs about a company in New Hampshire that is now 90 percent 
exports. We worked with a company in Congressman's--the 
Congressman has left--in Florida, that sells medical supplies, 
medical technology. He is 90 percent exports at this point. And 
we help them finance this insurance to places like Egypt, Iraq, 
and Sri Lanka, very difficult markets where he cannot get 
private sector insurance.
    Mr. Ellison. If you don't mind me interrupting for a 
moment, I have a business in my district, which is an 
engineering company, that does business in Senegal, that 
employs a number of people, not just engineers. And they have 
nothing but good things to say about the help they have 
received from the Ex-Im Bank. So I can tell you from my own 
district, the work you do is well-appreciated.
    Now, I have a question for you. There has been some 
questioning that has implied that this committee has asked the 
Export-Import Bank to do certain things, and there is some 
implication that you didn't do them. Are you aware of any 
outstanding demands the Ex-Im Bank has been charged with, but 
has yet to complete?
    Mr. Hochberg. This hearing was originally on mandates. The 
last hearing was on the requirements of the 2012 
reauthorization. And I brought with me that time a stack of 
every single report the committee asked for, a copy of the 
report, and the date we submitted it to the committee, whether 
it was on defaults, the Federal Register, the textile report, 
the small business report. Every one of those that were 
enumerated we have complied with and sent copies to this 
committee.
    Mr. Ellison. Yes, I am looking at a document here that 
looks like--
    Mr. Hochberg. Yes.
    Mr. Ellison. --kind of a list of all the things we have 
asked you to do.
    Mr. Hochberg. Precisely.
    Mr. Ellison. I see the word ``closed'' or ``responded'' 
after a lot of them. ``Fully implemented'' is commonly 
observed. And it looks like you have been doing what we asked 
you to do.
    Mr. Hochberg. We got 16 recommendations from GAO, for 
example, and we have complied with 15 and we are working on the 
16th.
    Mr. Ellison. Yes, yes.
    Mr. Hochberg. Some of them were received more recently. 
They were not all received in 2012, obviously.
    Mr. Ellison. Yes, I understand. Let me ask you this though, 
in 2002 Congress had directed the Bank to promote export of 
goods and services relatable to renewable energy sources. And 
although it is not explicitly part of the Bank's charter, since 
2008 appropriators have included language directing the Bank to 
make available not less than 10 percent of its aggregate 
authority to finance renewable energy exports.
    What type of financing does Export-Import Bank make 
available to exporters in renewable energy products?
    Mr. Hochberg. Most of the work that we do in the renewable 
energy sector has been on guaranteeing loans to foreign buyers: 
wind turbines in Central America and South America; solar 
panels in India. There is a solar project in South Africa. So 
they are usually guaranteed loans so the foreign buyer chooses 
an American product versus solar panels from Germany or China 
or Japan or so forth.
    Mr. Ellison. Does that help domestic makers?
    Mr. Hochberg. One, it puts the jobs here. Two, it provides 
them with sufficient volume that they also can provide those 
products here, as well.
    Mr. Ellison. Yes. And why are the loan terms generally 
longer for energy projects?
    Mr. Hochberg. By international agreement, the renewable 
energy can go as long as 18 years. That is the global standard. 
So to be consistent, and to have a level playing field, we 
provide that as well.
    Mr. Ellison. I want to thank the gentleman and I yield back 
the time that I think I don't have any more left of.
    Chairman Huizenga. That is accurate. But we were being 
generous.
    With that, we are going to go to a second round of 
questioning. And the Chair will recognize Mr. Mulvaney, from 
South Carolina, for 5 minutes.
    Mr. Mulvaney. Thanks, Mr. Chairman.
    Mr. Hochberg, I probably won't take the whole 5 minutes. I 
want to clean up and follow up on some questions that some 
other folks have started with you.
    Mr. Jordan was asking you about the Ex-Im project in Papua, 
New Guinea. And I think you said--and I couldn't get a 
transcript since you made the comments earlier this morning--
that the IG's office asked you for invoices on the $500 million 
of local expenditures, is that correct?
    Mr. Hochberg. $500 million was certified by Exxon Mobil.
    Mr. Mulvaney. Right.
    Mr. Hochberg. That money was extended for the project.
    Mr. Mulvaney. But what did the IG ask again? I am just 
asking what--
    Mr. Hochberg. The IG was asking to see the actual invoices 
that Exxon Mobil had.
    Mr. Mulvaney. And you said?
    Mr. Hochberg. We do not have those, nor did any of the 
banks in the consortium. There were over--
    Mr. Mulvaney. Why couldn't you--why not?
    Mr. Hochberg. None of the banks in the consortium required 
that. So we were at odds with the rest of the--
    Mr. Mulvaney. But you changed your policy on that sense 
or--
    Mr. Hochberg. We are now asking for more in-depth, yes.
    Mr. Mulvaney. So you were able to do it before, and you 
just chose not to do it?
    Mr. Hochberg. It was not part of our standard. Listen, one 
of the good things about the inspector general, why I work with 
him closely, why I meet with him, is to get better ideas of how 
to operate the Bank.
    Mr. Mulvaney. Again, when I am accusing you, you will 
probably know. I am just actually trying to figure out what the 
follow-up was to Mr. Jordan's question.
    Mr. Schweikert asked you a question about the aging report. 
And here I will be a little more tongue-in-cheek with you, 
because you and I have done this before. Where is Cuba on that 
aging report--pre-Castro Cuba? How many days would that be?
    Mr. Hochberg. That would be very long, sir.
    Mr. Mulvaney. What about the loans to government Chiang 
Kai-shek's in--before Mao took over mainland China--that are 
still on your books? How long have those been there?
    Mr. Hochberg. I will have to get back to you on that, sir.
    Mr. Mulvaney. Okay. They are still there, aren't they? Both 
of those are still there?
    Mr. Hochberg. Those are still--
    Mr. Mulvaney. Those are still deemed to be performing loans 
at the Export-Import Bank, the loans to pre-Castro Cuba and 
Chiang Kai-shek--
    Mr. Hochberg. No, they are not performing. They are just 
not written off.
    Mr. Mulvaney. They are not default. They are not--
    Mr. Hochberg. No, they are not performing loans, but we 
don't write them off because we are actually--in some cases, we 
can collect, believe it or not, 20 years later. So we don't 
write them off, but they are written down.
    Mr. Mulvaney. Speaking of which, by the way, you haven't 
asked the Administration to talk about the loans Cuba owes us 
from before Castro as part of the current discussions about 
changing relations with Cuba, have you?
    Mr. Hochberg. We have not had any discussion on that.
    Mr. Mulvaney. Okay. Just checking. Mrs. Love asked you a 
question about the 2012 reauthorization and you said--I thought 
I heard you say that it was your interpretation that it was up 
to the Secretary of the Treasury to talk about winding down the 
Bank, was the term you were using, but getting out of various 
segments of your business, if the Bank was not reauthorized. 
That is not your testimony, is it?
    Mr. Hochberg. I thought there were two separate questions, 
if I understand it, sir.
    Mr. Mulvaney. Yes.
    Mr. Hochberg. One was about if we are not authorized, the 
Treasury winds down the Bank. A second requirement of the 
reauthorization was to negotiate an end to export credits in 
general globally.
    Mr. Mulvaney. Correct. And that second piece is a legal 
obligation of the Treasury Secretary right now under the 
current law, correct?
    Mr. Hochberg. And they have sent three reports to Congress 
on their performance on that--
    Mr. Mulvaney. How often do you talk to Mr. Lew about that?
    Mr. Hochberg. I have talked to Mr. Lew, I have talked to 
Under Secretary Sheets about it.
    Mr. Mulvaney. No. How often have you talked with Mr. Lew 
about that?
    Mr. Hochberg. I talk with Mr. Lew perhaps twice a year on 
that. And I talk to Under Secretary Sheets far more frequently.
    Mr. Mulvaney. So your testimony is that several times a 
year, you will sit down with representatives of the Treasury to 
go over the implementation of Section 11 of the 2012 
reauthorization?
    Mr. Hochberg. Without question, several times.
    Mr. Mulvaney. And who is the Under Secretary of whom you 
are speaking?
    Mr. Hochberg. It is now Nate Sheets. Before that, it was 
Lael Brainard.
    Mr. Mulvaney. Were you aware that the CEO of Delta was here 
and testified under oath that Lael Brainard told him that she 
never intended to implement those reforms in the 2012 law? Are 
you aware of that testimony?
    Mr. Hochberg. I heard about that. I am not aware of the 
specifics of it, sir.
    Mr. Mulvaney. And I recognize the fact that she is no 
longer employed by you. But did you follow up on that? Did that 
surprise you? Is that consistent with the law, in your mind?
    Mr. Hochberg. She was the Under Secretary of the Treasury.
    Mr. Mulvaney. Right.
    Mr. Hochberg. That is not--I Chair the Export-Import Bank.
    Mr. Mulvaney. And I recognize, as I say, that she doesn't 
work for you. And I guess I said she doesn't work for you 
anymore. That is right, she has never worked for you.
    But was it unusual? Did you think it was unusual for the 
Under Secretary of the Treasury to say--or at least allegedly 
to say, pursuant as we have it from sworn testimony--that she 
was not going to implement the law?
    Mr. Hochberg. That has not been my experience with the 
Treasury Department. I think they have acted very aggressively 
and have submitted a report to this committee every year in 
November.
    Mr. Mulvaney. Lastly, I know we made a big deal earlier 
this morning about the newspaper articles with Mr. Boehner's 
quotes in it about the importance of the Bank. I was just 
wondering if you were aware of older newspaper articles 
regarding the Bank where Boeing actually said that if the 
Export-Import Bank were to go away, it would not affect their 
deliveries, and that the company was, ``confident they could 
find alternative funding sources for customers that would not 
require it to boost its support of aircraft sales.'' Are you 
aware of that position by Boeing?
    Chairman Huizenga. The gentleman's time has expired, but I 
will allow you to answer.
    Mr. Hochberg. The position that--I am not going to comment 
on that. I don't have the specifics in front of me, sir.
    Mr. Mulvaney. Okay.
    Chairman Huizenga. And the gentleman's time has expired.
    With that, we will go to Ms. Moore of Wisconsin for 5 
minutes.
    Ms. Moore. Thank you so much, Mr. Chairman.
    Mr. Hochberg, you just have been a marvelous witness under 
fire here. You just have been pilloried here today about 
everything from fair value accounting to this being corporate 
welfare. I never heard of welfare where you return money to the 
Treasury and support jobs.
    But you have been under particular attack with regard to 
the mandate of the Bank to support environmentally-sustainable 
projects. So I will give you a chance to sip some water, 
because I am just going to sort of talk for a couple of my 
minutes here.
    We once had a speaker here who was oft-quoted by both 
Democrats and Republicans who said that all politics was local. 
So it really doesn't surprise me that between these two 
committees, by my count--and it is a rough count--there are no 
less than seven Members from Texas, and they are valiantly 
protecting the petroleum business.
    Koch Industries, for example, is the second-wealthiest, I 
guess, company in the Nation. And they manufacture and refine 
fossil fuels, chemicals. And we have talked a whole lot about 
lawsuits. Just between 1999 and 2003, they have been fined at 
least $400 million in fines, penalties, and judgments. People 
have died because of oil spills across six States. They have 
paid almost $300 million in wrongful death suits because of a 
ruptured pipeline. And of course, most of the people in the 
fossil fuel energy support stuff like the Keystone Pipeline, 
even though they are very dangerous.
    Koch has had the largest civil fine ever under Federal 
environmental law. I just want you to understand that it is not 
personal, Mr. Hochberg. They are defending the oil 
```bidness,'' as they say.
    In 2000, a Federal grand jury returned a 97-count 
indictment against Koch Industries for environmental crimes. So 
I just wanted you to know the environment that you are in so 
that you can appreciate that it is not personal. People are 
just simply decrying one of the mandates that you have.
    Just quickly, would Koch Industries qualify for support 
under the Ex-Im Bank? They say we pick winners and losers and 
so on. And if Koch Industries were to engage in any of the 
other activities as other smaller businesses, would they 
qualify for your financing?
    Mr. Hochberg. Yes, they would. And they, in fact, have been 
a beneficiary of Ex-Im financing in the past.
    Ms. Moore. Okay. Very good. There was also discussion of 
your financing Solyndra. There was a lot of criticism around 
their solar modules. Did you finance Solyndra? I wasn't aware 
that you had done that.
    Mr. Hochberg. I am glad you asked that question. There have 
been a lot of rumors to that effect. No, we did not. We 
financed a company in Belgium that was looking to buy solar 
panels. They had a choice between German, Chinese, and 
American. And they chose panels from the United States, and 
they chose panels actually manufactured by the Solyndra 
Corporation. We lent money to the Belgian company. And as a 
result they bought American panels and supported jobs in our 
country versus China or Germany.
    Ms. Moore. And so those rooftop solar panels are providing 
energy for a distribution center, an international supermarket 
chain?
    Mr. Hochberg. Yes, and the loan is performing and is being 
paid back.
    Ms. Moore. Okay. Very good. I wanted to know that.
    I would like to yield my last minute to Mr. Heck.
    Mr. Heck. I didn't see that one coming, but I am grateful 
for it. Thank you.
    There was a lot of talk in my earlier question about small 
business. And we have had previous talks about where our 
country would be rendered as the only developed country without 
an export credit authority, should we allow it to expire.
    Just briefly, however, to put it in another perspective, 
how big would our Export-Import Bank have to be in order to be 
comparable to the four that China has?
    Mr. Hochberg. Oh, goodness. Well, China has one called 
SINOSURE that does their credit insurance like we do, and they 
do it in the range of $325 billion, $350 billion a year. We did 
in total--not just insurance, but in total--$20 billion last 
year.
    Thankfully, we have a better private sector. We have a 
better banking system so that--we are a capitalist society. 
Companies can rely on the private sector and don't have to only 
look to us. They look to us when the private sector is not 
there.
    Chairman Huizenga. The gentlelady's time has expired.
    And with that, we will recognize Mr. Hice of Georgia for 5 
minutes.
    Mr. Hice. Thank you, Mr. Chairman. You said that you have 
complied with every request of this committee. I just find that 
to be absolutely false. We have not received, for example, a 
response to any of my requests from a couple of weeks ago 
regarding a full accounting of all the missing Ex-Im data on 
data.gov 2 weeks ago. Why have we not received that, sir?
    Mr. Hochberg. I thought the question, sir, was about the 
requirements of the 2012 reauthorization act. I was referring 
to, we have fully complied with every requirement of the 2012 
act.
    We have received over 24 letters from this committee and 
subcommittee since July. And we are replying to every one of 
those as quickly as possible.
    Mr. Hice. When can we expect to have it?
    Mr. Hochberg. Actually, we have responded to your letter, 
sir. We sent you a letter--we did respond.
    Mr. Hice. Why have we not received it?
    Mr. Hochberg. We sent it to the committee on Friday.
    Mr. Hice. Okay. We will check into that and we will getting 
back with you if that is not here. But as of a few moments ago, 
it had not been received.
    Let's go on. Also at our last hearing, you promised to 
provide this panel with information explaining how Boeing knew 
about Delta's FOIA request for communications between Boeing 
and Ex-Im. You said that Boeing had knowledge of the request 
because the Bank notified Boeing that its information was being 
sought. But yet, this information was not included in your 
response to the panel. Again, why have you not provided that 
information?
    Mr. Hochberg. What I tried to explain is that under FOIA 
rules--and I am not a lawyer--if a company is the subject of a 
FOIA request, we are obligated to inform the party that we are 
providing information subject to a FOIA request.
    Mr. Hice. And that was not done?
    Mr. Hochberg. We did provide that information--
    Mr. Hice. You didn't provide it to us, and you didn't 
provide it to Delta, either. Again, as of--
    Mr. Hochberg. Delta was the one who asked for it. So we had 
to--
    Mr. Hice. We asked for it as well in this committee. And we 
did not receive it. And I want to know why.
    Mr. Hochberg. That letter was sent to the committee on 
Friday, April 24th.
    Mr. Hice. All right. So you are saying again that that has 
been received?
    Mr. Hochberg. We sent the letter to the committee on the 
24th.
    Mr. Hice. All right. Why was Delta not notified?
    Mr. Hochberg. I am not sure I understand the question--
notified about--
    Mr. Hice. According to your rules, your policies regarding 
FOIA requests and regulations, the Bank shall notify the 
requester--in this case Delta--in writing whenever a business--
that would be you, the Bank--is given a pre-disclosure 
notification. And that has never been received by Delta. Even 
up to the last few minutes before I walked in here, Delta has 
never heard anything. And why is that?
    Mr. Hochberg. If I understand correctly, sir, and if I am 
not--I will get back to you. But if a company request, a FOIA 
request or--we inform the company that--whose data we are 
therefore sharing with an outside party. Delta was the 
requester, not the subject of the FOIA.
    Mr. Hice. Delta submitted a FOIA request in October of 
2012. In February 2013, Boeing submitted its FOIA request for 
Delta's FOIA. On April 2013, Ex-Im published a FOIA log showing 
Delta's request was not started. So it didn't even acknowledge 
that Delta had put forth a request. We are clearly missing some 
communication here from the Bank to Boeing between October of 
2012 and February of 2013. And we expect a response.
    Mr. Hochberg. The letter I sent to the committee on April 
24th explained--fully outlined all of the answers to the 
questions you are asking. I am sorry that somehow from the 
committee to your office, that letter didn't--
    Mr. Hice. This has been going on for years.
    Mr. Hochberg. We just got the letter request from you at 
the hearing 2 weeks ago. And I submitted a response on April 
24th.
    Mr. Hice. Why has it taken so long to fill the request?
    Mr. Hochberg. Sir, listen, we have gotten from this 
committee and from Chairman Issa--we have submitted 100,000 
pages of documents over the last several year, 50,000 of those 
in the last--
    Mr. Hice. All right. Let me go back to this one, because I 
have just barely over 30 seconds.
    On November 19, 2014, Delta submitted FOIA request number 
two. On January 12th of this year, they paid an over $90,000 
invoice. As of April of this year, April 20th, the latest 
status update from Ex-Im, there has still been no response to 
Delta. Why is it taking so long?
    Mr. Hochberg. Sir, we have gotten this year already as many 
FOIA requests as all of last year. We are running at double the 
level. And we have also, as I have said--we prioritize 
responses to Congress over FOIA requests. So we just submitted 
50,000 pages to Congress in the last 6, 7 months.
    That said, I would like to improve our FOIA response. I 
think we need to get better at it and move faster.
    Mr. Hice. I think you do, as well.
    Chairman Huizenga. The gentleman's time has expired.
    Mr. Hice. Thank you, sir.
    Chairman Huizenga. With that, we will recognize the ranking 
member of the Health Care, Benefits and Administrative Rules 
Subcommittee, Ranking Member Cartwright, for 5 minutes.
    Mr. Cartwright. Thank you, Mr. Chairman.
    Mr. Hochberg, I want to pick up on some questioning from 
Mr. Hensarling who, unfortunately, has stepped out. But he 
raised the possibility that I have misquoted the Speaker of the 
House on the question of support for the Ex-Im Bank and the 
jobs that it creates.
    And I can tell you that I have now looked at both Politico 
and Reuters, and they are quoting the same thing exactly word-
for-word from Mr. Boehner, who said this: ``There are thousands 
of jobs on the line that would disappear pretty quickly if the 
Ex-Im Bank were to disappear.''
    Both Politco and Reuters said that. And I take it you still 
agree with that statement, Mr. Hochberg?
    Mr. Hochberg. Yes, I do, sir.
    Mr. Cartwright. All right. And I want to talk about the 
bipartisan support the Ex-Im Bank and its mandates have 
received over the past few decades. Congress has reauthorized 
the Ex-Im Bank 16 times, am I correct in that?
    Mr. Hochberg. That is correct.
    Mr. Cartwright. All right. And as Business Insider has 
noted, 14 of the 16 times the Bank's reauthorization has come 
up for a vote, it has passed by either a unanimous consent or 
voice vote, which is tantamount to a unanimous vote, in at 
least one chamber of Congress.
    In addition, H.R. 597, the Reform Exports and Expand the 
American Economy Act--and I think you talked about this a 
little bit--which would reauthorize the Bank while instituting 
certain reforms, has 60 Republican cosponsors, as of now.
    Also, H.R. 1031, the Promoting U.S. Jobs Through Exports 
Act of 2015, which would also reauthorize the Bank, has 189 
Democratic cosponsors.
    Taken together, these two bills make it clear that the Ex-
Im Bank has the support of a majority of the House of 
Representatives, and that those who are raising their voices 
against it in this committee here today are a very, very small 
but very vocal minority.
    Chairman Hochberg, I would like to turn now to the specific 
Bank mandates under discussion today and their support by both 
Democratic and Republican leaders. First, the devoting a 
portion to small businesses. The Ex-Im Bank Act Amendments of 
1983, the bill that first directed the Ex-Im Bank to devote a 
portion of its financing to small businesses, was signed into 
law by President Reagan, correct?
    Mr. Hochberg. That is correct.
    Mr. Cartwright. And the Ex-Im Bank Reauthorization Act of 
2002, which increased the small business lending target to 20 
percent of the Bank's authority, was signed into law by 
President George W. Bush, am I correct in that?
    Mr. Hochberg. That is correct, yes sir.
    Mr. Cartwright. And that same 2002 act signed by President 
Bush also established the Bank's renewable energy mandate, am I 
correct in that?
    Mr. Hochberg. Exactly, sir.
    Mr. Cartwright. The same mandate that has been objected to 
by my colleagues across the aisle today.
    I would also like to discuss the history of the Ex-Im 
Bank's sub-Saharan African mandate, which requires the Bank to 
expand its commitments in that region. Chairman Hochberg, this 
mandate was established in an amendment adopted under 
Republican Financial Services Committee Chairman Jim Leach, am 
I correct in that?
    Mr. Hochberg. That is correct, sir.
    Mr. Cartwright. And this amendment received bipartisan 
support before being incorporated into the Ex-Im Bank 
Reauthorization Act of 1997, correct?
    Mr. Hochberg. That is correct, sir.
    Mr. Cartwright. Is it fair to say then that Members of both 
parties, including Republican and Democratic Presidents, have 
supported this Bank and its specific commitments to small 
businesses, renewable energy, and also sub-Saharan Africa?
    Mr. Hochberg. That is absolutely correct, sir.
    Mr. Cartwright. Thank you, Chairman Hochberg. I find it 
hard to say, speaking for myself, that I understand why, after 
this longstanding bipartisan support for something that is a 
win-win for American taxpayers and American jobs, this Bank is 
suddenly the focus of political controversy at all. So I thank 
you for appearing here today--
    Mr. Hochberg. Thank you.
    Mr. Cartwright. --and putting up with this committee.
    And I yield back, Mr. Chairman.
    Chairman Huizenga. The gentleman yields back.
    And with that, we recognize Health Care, Benefits and 
Administrative Rules Subcommittee Chairman Jordan, from Ohio, 
for 5 minutes.
    Chairman Jordan. Thank you, Mr. Chairman.
    Mr. Hochberg, how much financial assistance did the Export-
Import Bank provide to Solyndra--or actually, not to Solyndra; 
you told the gentlelady from Wisconsin that it was a Belgian 
company that you provided assistance to who bought panels from 
Solyndra. How much was that package, that authorization?
    Mr. Hochberg. The loan was $10 million.
    Chairman Jordan. $10 million. And do you recall when the 
Bank approved this financing that benefited the Belgian 
company, which then benefited Solyndra?
    Mr. Hochberg. It was a loan to the Belgian company that was 
approved by the board in February of 2011.
    Chairman Jordan. And at that same time, our records show 
that Solyndra was in serious trouble and it was renegotiating a 
loan guarantee it already had with the Department of Energy. 
Are you aware of that.
    Mr. Hochberg. I am aware of that, sir.
    Chairman Jordan. You are aware of it now. But I am asking, 
were you aware of it then?
    Mr. Hochberg. I can't recall. That was over 4 years ago 
whether--
    Chairman Jordan. No, no, no. This is kind of important. 
This is the company that went bankrupt. This was the poster 
child for those of us who thought this 1705 program at the 
Department of Energy was goofy, where they had 23 companies get 
$15 billion and they all had junk bond credit ratings, double 
D-minus ratings.
    So Solyndra is in trouble. They are refinancing, and 
redoing their loan with the Department of Energy. And at the 
same time that happens, you are saying it is just coincidence 
that the Ex-Im Bank is doing a $10 million financing deal with 
the Belgian company who is going to buy solar panels from 
Solyndra?
    Mr. Hochberg. Without question, sir. That Belgian company, 
I tried to mention, was looking at Chinese, German, and 
American panels--
    Chairman Jordan. When you--
    Mr. Hochberg. --and they chose American panels--
    Chairman Jordan. --approved the $10 million in financing to 
help the Belgian company buy panels from Solyndra, did you know 
that Solyndra was in the process of refinancing with the 
Department of Energy?
    Mr. Hochberg. I can't answer that question, sir, because I 
don't know the answer.
    Chairman Jordan. Did anyone at the Ex-Im Bank, to your 
knowledge, get on the phone and call people at the Department 
of Energy and ask what may be happening with this Solyndra loan 
at the Department of Energy at the same time you were getting 
ready to approve a deal that was going to benefit Solyndra?
    Mr. Hochberg. The loan was made to the Belgian company. The 
panels were put in place, ensured that they were actually 
operating as planned before any disbursement was made. That 
loan is on the books. It is being paid back on time. So that 
loan is a good loan--
    Chairman Jordan. But that is not--my question is not about 
the loan. My question is, was Solyndra benefiting from what you 
were doing? I want to know if you also knew they were getting 
other taxpayer assistance from the Department of Energy? And 
did that factor into your decision?
    Mr. Hochberg. That normally would not factor into our 
decision.
    Chairman Jordan. I am not asking if it normally did. I am 
asking if it did?
    Mr. Hochberg. Sir, that was over 4 years ago. In my tenure 
at the Bank--
    Chairman Jordan. No, but Mr. Hochberg, you knew in February 
2011 when you did this, that it was $10 million, which was--
    Mr. Hochberg. Actually, it was--
    Chairman Jordan. --kind of a high-profile issue at the 
time.
    Mr. Hochberg. I stand corrected. It was--
    Chairman Jordan. This was the company that went--it was 
sort of the poster child for this program at the Department of 
Energy. It went bankrupt, costing the taxpayers millions of 
dollars. And at the same time that was going on, you were 
financing a company that was going to buy Solyndra panels.
    Mr. Hochberg. And that loan is being paid back and the jobs 
were created and we are getting paid back in full.
    Chairman Jordan. I know. I didn't dispute that. I am just 
asking, did you know and did you coordinate with the Department 
of Energy when all this was happening?
    Mr. Hochberg. No, we don't coordinate with the Department 
of Energy--
    Chairman Jordan. Did you talk to anyone at the White House, 
anyone at the Department of Energy, when you were doing this 
Belgian deal that benefited Solyndra?
    Mr. Hochberg. Oh, absolutely not.
    Chairman Jordan. All right. Let's go back to this.
    Mr. Hochberg. And the loan was made in June or July of that 
year. I just want to make sure--
    Chairman Jordan. How many project authorizations does the 
Ex-Im Bank do in a typical year? How many did you do last year?
    Mr. Hochberg. In the range of 3,500.
    Chairman Jordan. 3,500. For how many of those 3,500 did the 
recipient pay for some travel for Ex-Im employees while those 
Ex-Im employees were in that timeframe of deciding whether this 
entity was going to get financing?
    Mr. Hochberg. Sir, as I mentioned, we have travel that is 
paid for by our sponsor for large projects so that--
    Chairman Jordan. I am asking--3,500? How many of them did 
the recipients pay for travel?
    Mr. Hochberg. I would be happy to get back to you on that. 
I don't have the precise numbers.
    Chairman Jordan. Take a guess.
    Mr. Hochberg. I have no--I am not going to take a--I don't 
want to mislead you.
    Chairman Jordan. Half of them?
    Mr. Hochberg. No. I don't want to mislead you.
    Chairman Jordan. 20 percent?
    Mr. Hochberg. I am not going to speculate.
    Chairman Jordan. What we do know is the one I referenced in 
my opening questions--$97,000, 4 employees. And those four 
employees got to travel to places like Tokyo, London, and the 
South Pacific paid for by Exxon, and Exxon got a $3 billion 
deal.
    Mr. Hochberg. Sir, those travel--it is just like a codel. 
This is about going to investigate. Negotiations happened in 
London, they happened in Japan, and then there were visits to 
Papua, New Guinea. This was a large project with a large--
    Chairman Jordan. Mr. Hochberg, I would like for you to 
supply, or provide to the committee how many of the 3,500 deals 
you did last year involved travel paid for by the entity 
getting the loan, getting the guarantee, getting the financing, 
I want to know how many of those 3,500 had that practice in 
place.
    Mr. Hochberg. I would be happy to provide that. And that 
practice is consistent with law. I should also add that board 
members who vote on these transactions never take part in those 
trips.
    Chairman Jordan. I yield back, Mr. Chairman.
    Chairman Huizenga. The gentleman's time has expired.
    The gentleman from Washington, Mr. Heck, is recognized for 
5 minutes.
    Mr. Heck. Thank you, Mr. Chairman.
    I seek unanimous consent to insert in the record letters 
from the Export-Import Bank dated April 16th and April 24th to 
these combined subcommittees to remove any mystery about 
receipt of these letters. The committee has received them, with 
your permission, sir.
    Chairman Huizenga. Without objection, it is so ordered.
    Mr. Heck. Secondly, my friend, Mr. Mulvaney, made reference 
to a dated comment by the Boeing company about the impact of 
the elimination of Ex-Im. I don't know what the date was on 
that. But let me give you one from the last several days from 
Reuters.
    ``Boeing Company may have to relocate U.S.-based businesses 
and manufacturing jobs overseas if Congress eliminates funding 
for the U.S. Export-Import Bank. On Thursday, Chief Executive 
Jim McNerney said, `Most of my engineering and manufacturing 
jobs are in the United States and I would like to keep it that 
way. But without Ex-Im, you would have to start asking the 
question about where they should be.'''
    I have said before and I say in the most serious and somber 
of tones, we are playing with fire. We are playing with fire of 
the heart of the manufacturing base in America if we continue 
down this path.
    My friend from South Carolina, whom I am very sorry left, 
asked a pretty spectacular question earlier; namely, in the 3 
years since the Ex-Im was reauthorized, what happened to cause 
it to go on life support? What happened to cause it to go from 
330 votes in favor of to life support?
    The problem with that, of course, as the Chair of the 
Export-Import Bank began to outline, is that it is not on life 
support. It does, in fact, have 250 cosponsors of two bills. 
And my friend--I think Ms. Moore referred to 189. That is 
wrong. It is 190. And there are 60 from the other side of the 
aisle for Mr. Fincher's version.
    The problem here isn't that it is on life support. The 
problem is that it hasn't been subjected to a vote. There is 
not a person sitting in this room who would dispute the fact 
that the votes are there to reauthorize the Export-Import Bank 
if it will but come to a vote.
    But it is a fair question. What happened since that 
reauthorization? That Chair hasn't changed. That Chair has. Mr. 
Baucus, who chaired this committee when it was reauthorized, 
led it through regular order. Last year, when it was 
reauthorized for a short period of time, it was outside of 
regular order. Earlier in this term, this winter, we had an 
amendment to the committee oversight bill, very innocuous, very 
neutrally-worded, suggesting that consideration of 
reauthorization of the Export-Import Bank ought to be subjected 
to regular order.
    And the new Chair, the factor that has changed, opposed it 
and it was defeated. Now, if I were a cynic, I would say that 
is because he is afraid. He knows the votes are here. He knows 
darn well the votes are here. That is why he won't bring it to 
regular order.
    Mr. Gowdy asked another interesting question of Mr. 
Hochberg. Not a terribly fair one, but an interesting one: Did 
he think that facts would persuade the Chair of the committee? 
Well, the truth is, they don't. And the truth is, I don't even 
blame the Chair for that. This is a matter of philosophy and 
values. And the Chair of the committee, who is opposed to 
regular order, who has publicly announced he is opposed to 
reauthorization of the Export-Import Bank will not have his 
mind changed by facts because it is a matter of philosophy.
    And he is 100 percent entitled to that philosophy. But it 
does not represent the majority point of view of the United 
States House of Representatives by any stretch of the 
imagination. If that were true, then he would bring Mr. 
Fincher's bill to markup. But he hasn't. And he hasn't 
scheduled it. And I think it is highly unlikely that he will 
schedule it.
    Because, again, he knows the votes are there: 190 Democrats 
on Ms. Water's version of the bill, Ms. Moore's and mine; 60 on 
Mr. Fincher's. The votes are there to reauthorize the Export-
Import Bank. He has his foot on the air hose as a matter of 
philosophy. He doesn't believe in Ex-Im. He is entitled to that 
point of view. I don't believe he is entitled to keep the will 
of this body from manifesting in consideration of this 
institution, this 80-year-old institution that creates jobs for 
Americans.
    And with that, I yield back the balance of my time.
    Chairman Huizenga. The gentleman's time has expired. And 
with me being the last questioner, I appreciate your time. I 
recognize myself for 5 minutes.
    But I do want to quickly explore something that was maybe 
touched on, but you said you talk to Secretary Lew about twice 
a year about particular projects.
    Mr. Hochberg. A few times a year. I don't keep a journal on 
how many times--
    Chairman Huizenga. All right. How many times do you talk to 
Under Secretary Sheets?
    Mr. Hochberg. Many times.
    Chairman Huizenga. How about the State Department 
interaction? Who and how often do you speak with at State 
Department?
    Mr. Hochberg. Currently, I work with Under Secretary 
Novelli, who is in the economics. Obviously, interaction, I 
just saw Secretary Kerry when I was in--
    Chairman Huizenga. So you do speak with the Secretary 
level, correct?
    Mr. Hochberg. If I am on a trip--sometimes we have traveled 
together. I was with him coming back from Panama, in fact.
    Chairman Huizenga. Yes, I had seen that in the paper. I 
assumed you had talked to him then.
    So did you do any of those types of trips with Secretary 
Clinton, as well?
    Mr. Hochberg. I traveled with Secretary Clinton once to 
China and once to Africa.
    Chairman Huizenga. And how often would you talk to her 
beyond that?
    Mr. Hochberg. Oh, I speak to Secretary Kerry more 
frequently.
    Chairman Huizenga. Okay. Well, she very publicly talked 
about the Russian airline deal and had said in 2009 that the 
Export-Import Bank would be looking for their application.
    So is there interaction directly? Did she have interaction 
on that particular deal with you?
    Mr. Hochberg. No. Not to my knowledge.
    Chairman Huizenga. But she threw it out there rhetorically?
    Mr. Hochberg. We are a part of--part of our State 
Department is also part of economic state to craft economic 
diplomacy. So when we are overseas, we are trying to sell 
products, we are trying to advance American interests. So it is 
not unusual for other members of the Administration to invoke 
our name.
    Chairman Huizenga. So to invoke your name and presumably 
follow up on that?
    Mr. Hochberg. Sometimes--
    Chairman Huizenga. I would hope so.
    Mr. Hochberg. Sometimes there is, sometimes there isn't.
    Chairman Huizenga. All right. How about Cuba? Have you 
granted any deals into Cuba?
    Mr. Hochberg. No. We have been closing Cuba. And it is in 
our charter, a prohibition on Cuba. And it is also we have--
this Congress has sanctions on Cuba. We do no business in Cuba.
    Chairman Huizenga. Okay. But obviously, the Administration 
is changing that. Do you plan to approve any deals into Cuba?
    Mr. Hochberg. Our charter prohibits it.
    Chairman Huizenga. Okay. I am also just a little bit 
curious, and the hearing was supposed to be a little more on 
the mandates, the elements that you are required to do, both 
the renewable energy portfolio, as well as sub-Saharan lending.
    Do you acknowledge that there are not enough deals to hit 
your 10 percent mandate?
    Mr. Hochberg. In the--
    Chairman Huizenga. In renewables?
    Mr. Hochberg. Yes. There are not enough exports to hit that 
number.
    Chairman Huizenga. Okay. So do you believe that should be 
in there?
    Mr. Hochberg. I think the mandates have been good. I think 
they--what we have done--
    Chairman Huizenga. But they are not achievable.
    Mr. Hochberg. That is a target that is in there. But--
    Chairman Huizenga. But you could argue that you are 
mandated to do that, just as you are mandated to not do deals 
into Cuba. What if there is a renewable energy deal in Cuba? 
You have conflicting--
    Mr. Hochberg. No. No, we would not--there are a number of 
countries we do not do business in. We don't do business in 
Cuba. We don't do business in Venezuela, North Korea. There are 
a large number--
    Chairman Huizenga. Okay.
    Mr. Hochberg. There are a number of countries. I am not 
going to quantify that.
    Chairman Huizenga. So you are not open to removing the 
renewable energy mandate?
    Mr. Hochberg. Mr. Chairman, that is in the hands of 
Congress. Now, these three mandates were put in place by 
Congress, and we will execute them. It is their decision--your 
decision to make whether you want to continue them or not.
    Chairman Huizenga. In general, what are the parameters of 
the sub-Saharan lending, and are you able to achieve those?
    Mr. Hochberg. The sub-Saharan lending does not have a 
particular target in mind. So that we simply make extra effort. 
I travel there once a year. Our vice chair, that is part of her 
portfolio. We have two people who do business development there 
to make sure that companies understand if they are afraid of 
exporting there because of financing, we can let them know what 
tools we have.
    Chairman Huizenga. And I am being requested for 5 seconds. 
So I will recognize my friend from Wisconsin.
    Ms. Moore. Thank you so much, Mr. Chairman.
    I just wanted to point out there are a billion people in 
Africa. We really do need their business.
    Chairman Huizenga. All right. And with that, I would like 
to recognize my friend from South Carolina for my remaining 
time.
    Mr. Mulvaney. Mr. Cartwright asked why this wasn't an easy 
thing to do, why it was a big deal. I want to read something:
    ``The purpose of the Export-Import Bank is to create 
American jobs for American workers. Unfortunately, the Bank has 
a history of providing assistance to companies that have been 
exporting American jobs and hiring cheap foreign labor. For 
example, the Export-Import Bank insured a $3 million loan to 
help General Electric build a factory where Mexican workers 
will make parts for appliances that will be exported back to 
the United States. As a result, 1,500 American workers will 
lose their jobs to Mexican workers who will be paid only $2 an 
hour. I urge my colleagues to oppose S.1372, the Export-Import 
Bank Reauthorization Act.''
    That was the gentlewoman from California, Maxine Waters, in 
June of 2002. So it is of interest, no doubt.
    Chairman Huizenga. And at this time, I would like to thank 
Chairman Hochberg for being here, for taking your time today to 
be with us. There is no further business.
    The Chair notes that some Members may have additional 
questions for this witness, which they may wish to submit in 
writing. Without objection, the hearing record will remain open 
for 5 legislative days for Members to submit written questions 
to this witness and to place his responses in the record. Also, 
without objection, Members will have 5 legislative days to 
submit extraneous materials to the Chair for inclusion in the 
record.
    The hearing is adjourned.
    [Whereupon, at 4:48 p.m., the hearing was adjourned.]

                            A P P E N D I X


                            April 30, 2015
                            
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