Biden, in one of his first actions since taking office on Jan. 20, signed an executive order entitled “Tackling the Climate Crisis at Home and Abroad” which directs the Secretary of State and the Secretary of Treasury to coordinate with the Special Presidential Envoy for Climate in identifying ways the U.S can promote ending international financing of carbon-intensive fossil fuel-based energy while promoting renewable energy.
“The Ex-Im Bank is an affront to the taxpayer and free enterprise,” Toomey, the ranking member of the Senate Banking Committee, told FOX Business. “But if U.S. taxpayers are going to fund worldwide corporate welfare, then an obligation exists to award funds based on a recipient’s ability to pay the taxpayers back.
“The Biden administration’s decision to turn the Ex-Im Bank—which has consistently funded carbon-heavy projects—into an instrument supporting left-wing climate policy changes will almost certainly lead to an even greater risk of losses for the American taxpayer.”
EXIM Bank comes in after private-sector lenders are not able to provide financing or enough financing at market rates for the foreign buyer to purchase a U.S. export. EXIM provides a U.S. government guarantee on behalf of the foreign buyer, allowing the lender to proceed with the transaction.
Toomey, in a letter sent on Thursday, requested a briefing from the EXIM Bank no later than the week of Apr. 5 and asked EXIM to produce a list of former employees, including contractors, who will be participating in the climate finance plan and those who will be carrying out the order.
He also wants all records in EXIM’s possession pertaining to the order and a list of all of the projects the bank has financed since Mar. 1, 2016.
EXIM Bank did not respond to FOX Business’ request for comment.
Biden’s executive order calls on the U.S. to promote the flow of capital “toward climate-aligned investments and away from high-carbon investments.”
EXIM already provides financing for renewable exports. The bank, in 2009, established a $250 million credit facility to finance renewable energy exports, including solar, wind and geothermal.
Carbon-heavy industries are among the biggest beneficiaries of EXIM funding.
Some of the bank’s top borrowers over the years have included state-owned Mexican oil giant Petroleos Mexicanos (Pemex), state-owned airlines in Kenya and China, and Australian iron ore miner Roy Hill.
EXIM’s charter “does not allow the bank to choose which transactions to finance and which it won’t except on the basis of underwriting eligibility,” said Steve Renna, former chief banking officer at Export/Import Bank
He added there is no limit on any product or service the EXIM can provide financing to and that the “only limitation” is that the bank cannot finance sales to foreign defense ministries.
EXIM Bank has been given several Congressional “mandates” over the years which include things like quotas for small business lending, instructing the bank to lend more to Sub-Sahara Africa, and aiding U.S. exporters competing with China. However, those “mandates” are not enforceable because the bank is an independent agency.
Climate change has been at the center of Biden’s agenda, which aims to “transition” the U.S. away from its reliance on fossil fuels toward cleaner, renewable energy sources like solar and wind.
The president’s climate agenda uses Democratic Rep. Alexandria Ocasio-Cortez of New York’s Green New Deal as a “framework.” The plan calls on the U.S. to reach net-zero climate emissions by 2050.
Biden has in the early days of his administration rejoined the 2016 Paris climate agreement, revoked the permit for the Keystone XL pipeline and instituted a temporary ban on new permits and leases for drilling on federal lands and waters, among taking other climate actions.