Money Matters: This Week in Washington
This Week in Washington for July 24, 2017
By Dina Ellis and Casey Miller
As is usually true of the weeks leading up to August recess, the week was full of twists and turns.
Senator John McCain (R-AZ) Diagnosed with Brain Cancer: Senator John McCain was diagnosed with gliobastoma, an aggressive brain cancer, when he underwent a procedure to remove a blood clot over his eye on July 14. Senator McCain has friends and is receiving prayers from both sides of the aisle. Former President and 2008 campaign rival Barack Obama said that McCain is one of the “bravest fighters [he’s] ever known” and that “cancer doesn’t know what it’s up against.” With such a thin margin in the Senate, Senator McCain’s diagnosis calls into question the future of healthcare reform and possibly tax reform.
Obamacare Repeal Seeming Unlikely: Despite a White House meeting on July 19 and a late-night gathering of Senators, it seems less and less likely to repeal Obamacare in the coming days. Four Senators have announced opposition to starting debate, and more unannounced but likely members who oppose the legislation. Republicans had hoped to complete a repeal before August recess, but that is looking more and more unlikely—even if they stay in session a bit longer than planned.
White House Press Secretary Sean Spicer Resigned: According to a White House official, Press Secretary Sean Spicer resigned on July 21. According to the insider, Spicer resigned due to President Trump’s expected move to appoint Anthony Scaramucci as Communications Director. Scaramucci is a Wall Street financier and longtime Trump supporter. Sarah Huckabee Sanders will replace Spicer as White House Press Secretary.
On the Russia front: Sessions to Stay on as Attorney General: In response to President Donald Trump’s assertion that he would not have appointed Jeff Sessions as Attorney General had he known that Sessions would recuse himself from the Russia investigation, Sessions stated that he plans to continue to serve as Attorney General “as long as [it] is appropriate.”
Donald Trump, Jr. and Paul Manafort to Testify: Donald Trump, Jr. and former campaign Chairman Paul Manafort are scheduled to testify on Wednesday before the Senate Judiciary Committee. The hearing will cover Russia’s interference in the 2016 Presidential Election. Jared Kushner is to testify on Monday before the Senate Intel Committee.
Christopher Wray Approved by Senate Judiciary Committee: President Trump’s nominee to replace James Comey as FBI Director cleared the Senate Judiciary Committee on July 20, with a vote of 20-0. Wray is a former Justice Department official who has been in private practice for the last 12 years. Senate Majority Leader Mitch McConnell said that he intends to bring Wray’s nomination to the Senate floor before August recess.
Special Counsel Robert Mueller Asks White House to Save Russia Meeting Documents: Robert Mueller has asked the White House to preserve all documents that relate to the June 2016 meeting that Donald Trump, Jr., Jared Kushner, and Paul Manafort had with a Russian lawyer in Trump Tower.
ALSO LAST WEEK ON THE HILL
FY 2018 House Budget Released; Recommends Deregulation: The FY 2018 House budget proposal unveiled on July 18 includes deregulation of the financial services industry, recommending provisions of the
HOUSE FINANCIAL SERVICES COMMITTEE
- Mr. William Newcomb, Visiting Scholar, U.S.-Korea Institute, School of Advanced International Studies, Johns Hopkins University
- Mr. Anthony Ruggiero, Senior Fellow, Foundation for Defense of Democracies
- Ms. Elizabeth Rosenberg, Senior Fellow, Center for a New American Security
- Dr. John Park, Director, Korea Working Group, Belfer Center for Science and International Affairs, Kennedy School of Government, Harvard University
- Dr. George Selgin, Senior Fellow and Director, Center for Monetary and Financial Alternatives, The Cato Institute
- Dr. Mickey Levy, Chief Economist for Americas and Asia, Berenberg Capital Markets, LLC
- Dr. Jared Bernstein, Senior Fellow, Center on Budget and Policy Priorities
- Dr. Eric M. Leeper, Economics Professor, Indiana University Bloomington
Committee Members Send Letter to Trump on China: Twenty-four Members of the House Financial Services Committee, led by Reps. Andy Barr (R-KY) and Bill Huizenga (R-MI) sent a letter to the Trump Administration to pressure Chinese officials to permit non-China-based financial institutions to operate in the country. The letter came before the U.S. and China engaged in their Comprehensive Economic Dialogue on July 19.
SENATE BANKING COMMITTEE
- Ms. Brenda Hughes, Senior Vice President and Director of Mortgage and Retail Lending, First Federal Savings Bank of Twin Falls, on behalf of the American Bankers Association (ABA);
- Mr. Tim Mislansky, Senior Vice President and Chief Lending Officer, Wright-Patt Credit Union and President, myCUmortgage,LLC, on behalf of the Credit Union National Association (CUNA);
- Mr. Jack E. Hopkins, President and CEO, CorTrust Bank, N.A., on behalf of the Independent Community Bankers of America (ICBA);
- Mr. Charles M. Purvis, President and CEO, Coastal Federal Credit Union, on behalf of the National Association of Federally-Insured Credit Unions (NAFCU);
- Mr. Wes Hunt, President, Homestar Financial Corporation, on behalf of the Community Mortgage Lenders of America (CMLA); and
- Mr. Bill Giambrone, President and CEO, Platinum Home Mortgage and President, Community Home Lenders Association (CHLA).
LEGISLATION INTRODUCED AND PROPOSED
House Financial Services Ranking Member Maxine Waters
Despite the opposition of some Republicans, the House legislation has received the support of some groups that have previously opposed the bill, including the National Association of Realtors. This shows that the House bill is gaining support and progress is being made. The National Flood Insurance Program expires at the end of September and must be reauthorized or extended before then.
THIS WEEK ON THE HILL
Tuesday, July 25
Senate Banking Committee,
Mr. J. Paul Compton, Jr., to be General Counsel, U.S. Department of Housing and Urban Development;
Ms. Anna M. Farias, to be Assistant Secretary for Fair Housing and Equal Opportunity, U.S. Department of Housing and Urban Development;
Mr. Neal J. Rackleff, to be Assistant Secretary for Community Planning and Development, U.S. Department of Housing and Urban Development;
Mr. Richard Ashooh, to be Assistant Secretary for Export Administration, U.S. Department of Commerce;
Ms. Elizabeth Erin Walsh, to be Assistant Secretary for Global Markets and Director General of the United States and Foreign Commercial Service, U.S. Department of Commerce; and
Mr. Christopher Campbell, to be Assistant Secretary for Financial Institutions, U.S. Department of the Treasury.
House Financial Services Committee,
- H.R. 1624, the “Municipal Finance Support Act of 2017”
- H.R. 2864, the “Improving Access to Capital Act”
- H.R. 3110, the “Financial Stability Oversight Council Insurance Member Continuity Act”
- H.R. 3321, the “National Strategy for Combating Terrorist, Underground, and Other Illicit Financing Act”
- H.R. 3326, the “World Bank Accountability Act of 2017”
- H. Res. 442, Of inquiry directing the Secretary of the Treasury to provide certain documents in the Secretary’s possession to the House of Representatives relating to President Trump’s financial connections to Russia, certain illegal financial schemes, and related information.
Thursday, July 27
Senate Banking Committee,
Mr. Joseph Otting, to be Comptroller of the Currency; and
The Honorable Randal Quarles, to be a Member of the Board of Governors of the Federal Reserve System; Reappointment as a Member of the Board of Governors of the Federal Reserve System; and Vice Chairman for Supervision of the Board of Governors of the Federal Reserve System.
House Financial Services Committee, Hearing, “
The Honorable Steven Mnuchin, Secretary of the U.S. Department of the Treasury
Senate Agriculture Committee,
Rostin Behnam, to be a Commissioner of the Commodity Futures Trading Commission;
Dawn Stump, to be a Commissioner of the Commodity Futures Trading Commission; and
Brian Quintenz, to be a Commissioner of the Commodity Futures Trading Commission.
Treasury Department Seeking Industry Input on Financial Stability Oversight Council (FSOC): At a closed-door meeting on July 13, banks and securities firms spoke with officials at the Treasury Department about FSOC. According to those at the meeting, the Department was receptive to the input from industry. Among the ideas suggested was that FSOC stop designating companies as “systemically important,” a designation that subjects them to greater scrutiny.
Noreika also said that FSOC on July 28 will discuss the controversial propriety trading ban known as the Volcker Rule.
Securities and Exchange Commission (SEC) Rules Market Makers Can’t Trade Pre-Close: The SEC on July 14 disapproved a proposal by the New York Stock Exchange (NYSE) that would allow designated market makers to make trades that would establish a new high or low price in the last 10 minutes of trading. The SEC said that the NYSE hadn’t addressed the risk that market makers would engage in manipulative activity.
SEC Commissioner Michael Piwowar Says SEC May Unveil Small Business Advocate Office: Speaking in Washington on July 17, SEC Commissioner Michael Piwowar said that the agency may debut a small-business advocate office by the end of the year. The agency recently received approval to fund the office, which will be the Office of the Advocate for Small Business Capital Formation. The office will be responsible for identifying challenges that companies face in accessing capital, and recommending regulatory fixes.
Piwowar also commented on fintech innovations and the market for initial coin offerings (ICOs), saying that there is a challenging regulatory environment and many different federal agencies a startup must address. According to Piwowar, fintech is “transformational” and that the U.S. needs to make sure it is not “behind the curve” on the global phenomena.
NOMINATIONS, COMINGS AND GOINGS AT THE AGENCIES
President Trump Nominates Hester Peirce as SEC Commissioner: President Trump announced on July 18 his intention to nominate Mercatus fellow Hester Peirce as an SEC Commissioner. Peirce is a former Senate Banking Committee and SEC staffer.
OTHER NOTEWORTHY ITEMS
Coalition Pushes for New Market Access in China: The Engage China Coalition—a group of bankers, insurers, and other financial services providers—is putting pressure on the Trump Administration to try to open China’s market to foreign capital. China has places restrictions on the influx of foreign money into its markets. The group says that an upcoming bilateral summit is a good opportunity for the Administration to address the issue.
Paul Hastings’ Government Relations team is monitoring these issues. We help our clients craft strategies to address federal legislative and regulatory matters. Please reach out to us if your organization needs assistance with congressional or regulatory relations.