Washington Watch: Bank causing split in the GOP

“The Republican Party is the party of small business, not big business.” Rep. John Fleming, R-Minden

In the Regency Ballroom of the Omni Shoreham Hotel on June 21, the hundreds of diners attending the Faith and Freedom Foundation’s conference were treated to a video tribute to conservative icon Phyllis Schlafly and a keynote speech by Gov. Bobby Jindal.

Scattered around the sign-in tables by the ballroom entrances were free copies of the then-current June 23 issue of The Weekly Standard, the magazine that’s been called the bible of neo-conservatism and that serves as a vehicle for some of the leading theorists on the political right.

While the mood in the ballroom was festive and celebratory of a rising tide of anti-leftist sentiment, The Weekly Standard was far more pessimistic about the conservative movement and its political representative, the Republican Party.

The themes sounded in the June 23 issue by the magazine’s founder, William Kristol, and other writers point to a potential realignment of forces and allegiances across the political spectrum, with substantial implications for Republicans and Democrats and for future election outcomes. It’s a ferment that has divided the Louisiana Republicans in the U.S. House over an issue highlighted by the magazine and now on Congress’ plate: the U.S. Export-Import Bank.

The cover illustration for the June 23 issue is a cartoon inspired by the startling defeat of U.S. House Majority Leader Eric Cantor in a June 10 Republican primary in Virginia. Cantor played a major role in winning House approval of the 2012 re-authorization of the bank, which provides government-backed loans and credit guarantees to support exports by U.S. companies. Of the current members of the House delegation from Louisiana, Republicans Charles Boustany, of Lafayette, and Bill Cassidy, of Baton Rouge, supported the bank in 2012, as did Democrat Cedric Richmond, of New Orleans, and every other Democrat who voted on the bill.

But Republicans John Fleming, of Minden, and Steve Scalise, of Jefferson, voted no. Bravo for them, the Standard says.

The bank is up for re-authorization again this year, with a Sept. 30 deadline for Congress to act. Boustany has taken a prominent role in pressing for approval of the re-authorization. He argues that the bank benefits businesses in Louisiana and across the nation in competition with foreign companies aided by their own national financing tools.

Swelling the pro-bank ranks are the U.S. Chamber of Commerce, the National Association of Manufacturers and other leaders of the business establishment long allied with the Republican Party. Now those capitalist paladins are marching arm-in-arm with the Democrats, who solidly support the bank.

But the bank, in the opinion of the magazine and ideological conservatives like Fleming and Scalise, is an example of “crony capitalism,” and of a too-cozy relationship between government and big business that does nothing to help middle-class voters.

It was a countervailing message of “economic populism” that helped propel little-known college professor David Brat to his upset win over Cantor, the Weekly Standard says. And that banner, writer Jay Cost says in the magazine, must be seized by the Republicans.

In what Cost calls hypocrisy, given their own coziness with Wall Street and corporate America, the Democrats nonetheless have succeeded in “creating the widespread impression that the (Republican) party stands not with the middle class, but with the wealthy and well connected.

“If the GOP political class ever wants to return to a national majority, it needs to change that impression,” Cost writes. “The party’s reputation needs to be drastically reformed. It has to cleanse itself of cronyism and clientelism, then call for a similar purification of the federal government.”

Fleming, it seems, has heard that call.

“The Republican Party is the party of small business, not big business,” Fleming said recently in discussing the Ex-Im Bank, which funnels most of its support to large companies.

If conservatives want to reform welfare for individuals, then they should favor ending corporate welfare, too, Fleming said.

“We want big-corporate America to do well,” he said. “We just think they don’t need government to do well.”

Gregory Roberts is chief of The Advocate Washington bureau. His email address is groberts@theadvocate.com. Follow him on Twitter @GregRobertsDC.