Your Weekly Report on the Discord from Washington, D.C.
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Senate approves budget in move toward tax reform — Last Thursday the Senate voted 51-49 to approve a budget resolution close enough to the House version to avoid a conference committee, making it possible for the House to act on the proposal this week. If the House passes the resolution, the only reconciliation provision directs the Ways and Means Committee to overhaul the tax code. Adding tax reform to the budget resolution in Ways and Means would allow the legislation to bypass the House Budget Committee and move straight to the House floor. Speaker of the House Paul Ryan (R-WI) has said he expects to send tax reform legislation to the Senate in early November.
Equifax breach exposes limits in federal law, consumer protection — State-by-state laws on data security make it harder to prevent and punish breaches such as those experienced by Equifax, witnesses told the Senate Banking Committee last Tuesday. Committee members discussed the use of Social Security numbers as personal identifiers, the expansion of credit reporting models, and whether federal legislation is necessary to clarify credit reporting agencies’ fiduciary duty to consumers and to harmonize state requirements. Members agreed that it should be easier for consumers to freeze their credit reports, and noted that the cost of freezing these reports varies from agency to agency and even from state to state.
CFPB publishes consumer protection principles for third-party data access — As anticipated, the Consumer Financial Protection Bureau announced a set of principles designed to protect consumers who authorize financial data sharing and aggregation by financial services providers. The Bureau said that the principles “do not establish binding requirements,” and should not be seen as guidance for future supervisory or enforcement actions. But in general, access to financial services should not require that consumers share account information with third parties; consumers should have all the information they need to maintain control of access to their financial information; authorized data access is not the same as authorizing payments; consumer data should be secure at all times; consumers should be able to easily see who has access to their financial information, and should easily be able to stop or prevent access; and commercial participants should have efficient and effective accountability mechanisms in place.
Congress can challenge agency guidance on leveraged lending, says GAO — In response to an inquiry by Senator Pat Toomey (R-PA), the Government Accountability Office (GAO) has concluded that the federal banking agencies’ Interagency Guidance on Leveraged Lending, issued in March 2013, qualifies as a rule for the purposes of the Congressional Review Act. The GAO letter acknowledged that the agencies do not agree, but “an agency’s characterization is not determinative of whether it is a rule under CRA.” As a “general statement of policy,” the GAO said, the guidance “is a rule subject to the requirements of CRA.”
Redfearn named SEC Director of Trading and Markets — The Securities and Exchange Commission announced last Wednesday that Brett Redfearn will be Director of the Division of Trading and Markets. Redfearn was most recently Global Head of Market Structure for the Corporate & Investment Bank of J.P. Morgan, where he also served on the SEC’s Equity Market Structure Advisory Committee. His career began with the American Stock Exchange, and he has served on the boards of Bats Global Markets, the Chicago Stock Exchange, BIDS Trading, and the National Organization of Investment Professionals.
CSBS names Fintech Industry Advisory Panel — The Conference of State Bank Supervisors (CSBS), which represents state regulators of financial institutions, announced the creation of last week of a 33-member Fintech Industry Advisory Panel. Through three working groups — on money transmission and payments, lending, and community banking and innovation — members will identify ways to improve licensing and supervision across state lines. The group will meet by conference call later this month.
Next Week in Washington:
House Financial Services Subcommittee on Housing and Insurance holds a hearing on “The Federal Government’s Role in the Insurance Industry.” Witnesses include representatives of the insurance industry and Connecticut Insurance Commissioner Katharine Wade on behalf of the National Association of Insurance Commissioners. 10:00 a.m., 2128 Rayburn House Office Building.
Senate Committee on Banking, Finance and Urban Affairs holds a hearing on the nominations of David J. Ryder to serve as Director of the U.S. Mint, and Hester M. Peirce and Robert J. Jackson Jr. to serve as members of the Securities and Exchange Commission. 10:00 a.m., SD-538 Dirksen Senate Office Building.
House Financial Services Subcommittee on Housing and Insurance holds a hearing on “Sustainable Housing Finance: Private Sector Perspectives on Housing Finance Reform.” 10:00 a.m., 2128 Rayburn House Office Building.
House Committee on Financial Services continues its hearing on “Examining the Equifax Data Breach.” 2:00 p.m., 2128 Rayburn House Office Building.
House Oversight Subcommittees on Health Care, Benefits, and Administrative Rules and Government Operations hold a hearing on “Ongoing Management Challenges at IRS.” 2:00 p.m., 2154 Rayburn House Office Building.
Senate Banking Committee holds a hearing on the nominations of Brian D. Montgomery as Assistant Secretary of Housing and Urban Development for Housing and Federal Housing Commissioner; Robert Hunter Kurtz as Assistant Secretary of Housing and Urban Development for Public and Indian Housing; and Suzanne Israel Tufts to serve as Assistant Secretary of Housing and Urban Development for Administration. 10:00 a.m., SD-538 Dirksen Senate Office Building.
The Ellis Insight. Jim Ellis reports on political news:
Alabama: A new Fox News poll (10/14-16; 801 AL registered voters) finds the Alabama special general election between former State Supreme Court Chief Justice Roy Moore, the Republican nominee, and former US Attorney Doug Jones, the Democrat evolving into a 42-42% tie. But, this poll appears to have a significant Democratic skew. Conversely, a new Raycom News Network survey (10/16, 3,000 AL likely voters) finds a drastically different result. As with other polls released before the Fox results, Raycom finds Judge Moore to be holding a substantial lead. According to their numbers, the spread is 51-40% in favor of the Republican candidate.
California: Sen. Dianne Feinstein (D-CA) drew a major opponent last Sunday just days after she formally announced her run for a fifth full term. State Senate President Kevin de Leon (D-Los Angeles) declared his challenge to the veteran office holder and it will be decidedly from the left. Meanwhile, US Rep. Eric Swalwell (D-Pleasanton/East Bay Area) who originally didn’t close the door about running now has done so. On Friday, the three-term Congressman not only announced that he won’t run for the Senate, but he publicly endorsed Sen. Feinstein’s re-election bid.
Mississippi: Democrats may be on the verge of recruiting a credible candidate in the Mississippi Senate race. Public Service Commissioner Brandon Presley, who represents the northern sector district on the three-member statewide body, is reportedly considering entering next year’s race. Mr. Presley is a cousin to the late rock and roll legend Elvis Presley, since his grandfather and the world famous singer’s grandfather were brothers. Though Mr. Presley is credible, the Republicans are still strong favorites to hold the Magnolia State seat.
Missouri: Remington Research went into the field just as Attorney General Josh Hawley (R) was announcing his challenge to Sen. Claire McCaskill (D). The survey (10/11-12; 965 MO likely voters) finds the incumbent trailing early. According to the ballot test data, Mr. Hawley jumps out to a tight 48-45% edge over the two-term Senator. Interestingly, though President Trump (48:47% favorable to unfavorable) and Gov. Eric Greitens’ (46:39% positive to negative) job approval indexes were tested, the questionnaire apparently did not include such a question for either Sen. McCaskill or AG Hawley.
Tennessee: After originally saying he would not run for the Senate, Tennessee former Gov. Phil Bredesen (D) is now admitting that he is re-thinking his position and will consider forming a new statewide campaign. Democrats need him in the race to make this open seat competitive, since they have so few Republican targets in 2018. Even if Mr. Bredesen becomes a candidate, the GOP will be favored. Rep. Marsha Blackburn (R-Brentwood) appears to be the early leading contender, but former US Rep. Stephen Fincher (R-Crockett County) appears poised to also enter the race. Sen. Bob Corker (R) is retiring upon completion of his second term.
IN-6: Greg Pence, the brother of Vice President Mike Pence, announced that he will enter the open 6th District congressional race, from the seat that his sibling once held. Current incumbent Luke Messer (R-Greensburg/Muncie) is running for the Senate, a campaign effort with which Greg Pence was originally finance chairman. This is a developing story, but the Vice President’s brother certainly must be considered a very serious open seat candidate from a solid Republican district that has already elected a Pence multiple times.
ME-2: The Global Strategy Group ran a survey for what they term is an unidentified outside organization, testing two-term Maine Rep. Bruce Poliquin (R-Oakland/Bangor) and environmental activist Lucas St. Clair (D). The poll (10/2-5; 625 ME-2 interviews; 400 likely 2018 general election voters; 300 likely ME-2 Democratic primary voters) finds that Mr. St. Clair, the son of Burt Bees products co-founder Roxanne Quimby and who led the charge for the Katahdin Woods and Waters National Monument projects, easily leading the Democratic nomination battle. According to the GSG results, Mr. St. Clair has a 40-8% advantage over state Rep. Jared Golden (D-Lewiston). When the Democratic polling leader is paired with Rep. Poliquin, the Congressman clings to a 44-41% edge.
OH-12: Late last week, nine-term Rep. Pat Tiberi (R-Galena/Franklin County) made public his intention to resign from the House before January 31st in order to become president of the Ohio Business Roundtable organization. Earlier, Mr. Tiberi flirted with running for the Senate and went on a fundraising tear, only to leave it all behind just a few months later. His campaign treasury exceeds $6 million, which could go to the national party, help fund an affiliated political action committee, or remain in the bank in case the Congressman decides upon a future return to elective politics. The departure will necessitate Gov. John Kasich (R) calling a special election to fill the seat that he, himself, held for 18 years.
PA-10: The controversial Washington Post and 60 minutes stories attacking Rep. Tom Marino (R-Williamsport) for his role in advocating a new law that allegedly makes it more difficult for the Drug Enforcement Agency to stop opiates has resulted in the Congressman withdrawing his name as the nominee to head the National Drug Control Policy agency. This means that his 10th District seat is no longer open, at least for the time being. It is now certain there will be no special election here, but Mr. Marino did not mention whether he would seek re-election to the House since he will not be moving into the Administration.
UT-3: A Dan Jones & Associates poll (10/9-16; 410 UT-3 registered voters) finds Provo Mayor John Curtis (R) in strong shape as we head into the final weeks of the special election campaign to replace resigned Rep. Jason Chaffetz (R-Alpine/Sandy). According to the Jones company results, Mr. Curtis has a commanding 46-19% lead over physician Kathryn Allen, the Democratic nominee. Considering that Hillary Clinton even failed to place second here last November, this poll is likely in the correct realm even though it appears to have some methodological flaws. Expect Mayor Curtis to hold this seat for the GOP on November 7th.
UT-4: Two-term Rep. Mia Love (R-Saratoga Springs) has drawn a major opponent for her second re-election campaign. Salt Lake County Mayor Ben McAdams announced last Thursday that he will seek the Democratic nomination for the purpose of challenging Ms. Love in the general election. The Congresswoman, while winning two of her three congressional campaigns, has under-performed the average Republican vote percentage. Therefore, against Mr. McAdams, who has won countywide as a Democrat, we can expect a relatively competitive general election.
Alaska: The Alaska political parties can now adopt an Independent candidate as their individual nominee according to a Superior Court ruling in Alaska, this week. The door is now open for the Democratic Party possibly awarding their ballot line to Independent Gov. Bill Walker in his campaign for re-election. Mr. Walker was the de facto Democratic nominee in 2014, when he ousted Gov. Sean Parnell (R) as an Independent with a Democratic running mate. The ruling may be moot from a practical standpoint, however, if former Sen. Mark Begich (D) decides to enter the race, which he admits to be considering. If so, an interesting three-way race will develop. If not, watch the Democrats again coalesce behind Walker as a way to defeat an eventual Republican opponent.
Maine: Sen. Susan Collins (R) has now made public her long-awaited decision about running for Governor next year. In a series of interviews, Ms. Collins indicated her belief that she can best help her constituency by staying in the Senate, a body of which she has been a member since 1997. Therefore, she will not run enter the 2018 open Governor’s contest. Sen. Collins was in favorable position to run for the state’s top post because she would not have had to risk her current position. Her particular Senate seat next comes in-cycle in 2020.
New Jersey: Fairleigh Dickinson University surveyed the New Jersey electorate in advance of the state’s November 7thgubernatorial election and unsurprisingly found the same basic result that all other pollsters have determined. The poll (10/11-15; 658 NJ likely voters pulled from a registered voters list complete with voter history) projects former US Ambassador to Germany and Wall Street executive Phil Murphy (D) to be leading Lt. Gov. Kim Guadagno (R), 47-33%. Again, Gov. Chris Christie’s unpopularity is a factor. Only 16% of those sampled gave the Governor a positive rating, with 43% saying he is a “major” factor in this election. Within this latter subset, 79% say they support Mr. Murphy.
Virginia: After a long series of polls favorable to Lt. Governor Ralph Northam (D) in his quest to outpace Republican Ed Gillespie and succeed term-limited Governor Terry McAuliffe (D), the new Monmouth University poll (10/12-16; 408 VA likely voters) produces the opposite result. The Monmouth data shows Gillespie now pulling into a slight one-point 48-47% lead. The movement could relate to ads the Gillespie Campaign has been running, attacking Northam for what the script calls his weak record on law enforcement as it relates to immigration and sanctuary cities.
A day after Monmouth University publicized its data, Quinnipiac University released their own survey (10/12-17; 1,088 VA likely voters) that sees the race moving in the opposite direction. According to the Q-Poll data, Northam commands the race, 53-39%. Though the Monmouth poll may well be too favorable for Gillespie, there is no sustained credible evidence to suggest that Northam has anything close to a 14-point lead, particularly when late momentum appears to be moving Gillespie’s way.
Wisconsin: It has been presumed for months that two-term Governor and former Republican presidential candidate Scott Walker would run for a third term, and now he has made the speculation official. Late last week, Mr. Walker declared his candidacy for re-election and appears in a credible position to win again. Thirteen Democrats are in the race, but likely the most prominent contenders are Superintendent of Public Instruction Tony Evers and Madison Mayor Paul Soglin. Gov. Walker can expect a competitive general election regardless of whom he eventually faces. The Wisconsin primary won’t be until August, so it will be months until we see how the Democratic primary actually unfolds.