SEC Nominations (Apr. 20)

Mike & Co. — 

Hillary’s commanding victory in the New York primary last night is cause for celebration and bring the Secretary a decisive step toward  the Democratic nomination.  Tremendous effort and outcome —  congratulations all around. 

Speaking of nominations, the path forward has gotten still murkier this month in Senate Banking.  Four Committee Democrats are bucking  administration wishes, blocking its two outstanding and previously-agreed SEC nominees.  At stake is a progressive policy goal, one which HRC supports — requiring publicly traded companies to disclose their political donations.  More on this and the nominations below. 

Best,

Dana

 

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Banking Committee’s Recent Record

What was supposed to be a routine Senate Banking vote on the administration’s nominees for two vacant seats on the five-member Securities and Exchange Commission  during their confirmation hearing on April 7.

But without warning, four Committee Democrats refused to support their own party’s nominee.  The Democrats were joined by Tim Scott of South Carolina in voting “nay” on a group of five regulatory nominees, including two SEC commissioners.

The Committee has not yet held another vote on the matter, and there have been no hints from the Shelby office on the timing for a new vote.  It’s considered likely that the Banking Chairman will want to move before Memorial Day.   The Committee approved its first nomination in 15 months and faces nomination backlogs on several key fronts.

The Protest

Sens. Schumer, Menendez, Warren, and Merkley declared at the hearing that they would not support the nomination of Lisa Fairfax, a Democrat, or Hester Pierce, a Republican, until they were assured by each nominee that they would support rules requiring publicly traded companies disclose their political donations.

The only option to block each SEC hopeful was to block the nominees for other agencies bundled with them.  Conspicuously missing from the Democratic “gang of four” was committee Ranking Member Sherrod Brown.

The group’s actions caused Committee chairman Richard Shelby to withdraw the voice vote; he has not announced a return date.  With only five “nay” votes in Committee, Shelby could easily have ruled that the ayes have it and waved the package of nominees through to the full Senate.  Shelby has offered no insight on why he decided not to allow the vote to move forward.

It’s worth noting that HRC happens to agree with the position taken by the four Senators.  The Secretary has long called for businesses to disclose their political donations, and is on record calling on the SEC to draft a rule requiring such.

SEC Future

So the SEC will continue to operate at three-fifths capacity.  This has become the new normal — these two seats on the Commission have remained vacant since  mid-2015.  If the vacancies remain open for much longer, it may be difficult for Char Mary Jo White to push forward with her own policy agenda in what is likely her last year in the post.  The SEC requires a three-vote minimum to set an agenda or even hold a meeting.  As things stand the Republican voice on the commission, Michael Piwowar, holds an effective veto power over the action by the SEC.

Next Steps

The full set of nominees considered by the Committee included officials for Treasury, the FDIC, and the United States Mint.  As the Senate session creeps to a close observers believe that Majority Leader Mitch McConnell will devote little time on the floor to debate nominee confirmations, meaning that the best shot for many lingering nominees is for the full Senate to approve them by unanimous consent — which a single senator can block.  Democrats who object to the nominee’s lack of position on disclosure requirements need to ask themselves if they’d rather have a crippled SEC or one atbfull strength without securing a public commitment by the nominees regarding the public disclosure rule.

 

 

 

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