By Mark Egan
Texan Frank “Frankie” Wilson Sr.’s ties to his employer, Gaumer Process, run deep.
Wilson, 60, recalls he started out making parts for Gaumer, a Houston-based supplier of heating equipment to GE power plants, at his father’s machine shop. Later, after working for three years at GE, Wilson landed his first job at Gaumer as a welder. Now, 18 years on, Wilson drives a Gaumer truck, a job he loves. Meanwhile, four of his close relatives and many of his friends also depend on the firm for their livelihood. “To my family,” Wilson says, “Gaumer means everything.”
Wilson doesn’t usually fret over the workings of the international financial system but these days, he’s concerned about a fight over the fate of the Export-Import Bank of the United States. The American credit agency guarantees loans to foreign companies that purchase U.S. products, and it is in danger of losing its charter on June 30.
If the U.S. Congress fails to renew the 80-year-old Ex-Im Bank’s charter, Gaumer will be forced to cut 60 of 150 jobs, say managers there. Thousands of small U.S. companies contracted to build equipment for GE and other export giants will face the same pressures.
A finished Gaumer Process 3-Zone Hot Oil Circulation system, loaded on a truck ready to be shipped to Canada.
The Wilson family could be hit hard. Frankie’s brother David and his son Frankie Jr. work in quality control. His wife, Guenseslada, is an executive assistant. His son-in-law Peter Stewart is an electrical foreman. So the Wilsons and their co-workers are watching the debate over the Ex-Im Bank closely. “For us, it affects so many lives, from my family to my grandchildren,” Frankie Wilson says. “Gaumer is our livelihood. We depend on it to pay the bills.”
Though Ex-Im is called a “bank,” it’s no ordinary lender. Instead, it plays a key helper role. Say a big overseas utility borrows money to purchase a GE power-plant system with gear from various suppliers like Gaumer. The overseas utility needs to reassure its lenders that they will be covered when the collateral for the loan (shiploads of valuable GE gear) is traveling over international waters. So the utility turns to the Ex-Im Bank, which—for a fee—guarantees the loan.
Opponents of Ex-Im insist that the private sector should be able to cover this sort of lending, and that Ex-Im shifts risk from corporations to taxpayers. However, dozens of countries around the world—including developing markets that are hungry for the power and healthcare equipment GE and companies like Gaumer team up to provide—require the backing of a government bank, not a private one, for large-scale infrastructure projects. Without a U.S. Export-Import Bank, those deals would go to companies from the 60 other countries in the world with their own Ex-Ims.
This would have real consequences for families like the Wilsons. Though Houston-based Gaumer is not a household name, the electric process heaters and engineered systems it makes for power plants and refineries and for the petrochemical and gas industries have been shipped worldwide. Gaumer corporate controller Patrick Patel says it’s a special company. “We are literally what made America great—a hard-core, sophisticated mechanical engineering firm working in a field where many countries simply cannot compete,” Patel says.
The Ex-Im Bank supported 164,000 American jobs last year and 1.3 million in the last six years, buoying an American manufacturing sector that employs 17 million people. At Gaumer alone, Patel says $10 million of Gaumer’s $35 million annual revenues depend on Ex-Im support—meaning if the bank loses its mandate, jobs will be cut.
“Losing those jobs will be devastating, but what is worse is that manufacturing skills are already dying in the United States,” he said. “The best technicians will be laid off and they will never teach the next generation the techniques of manufacturing.”
“Our life depends on this,” Patel said.
To learn more about the U.S. Export-Import Bank and why it matters to U.S. businesses, please visit http://exportersforexim.org/.