GR’s lobbyists among top “hired guns”
Congratulations to our own Doyle Bartlett, Chris McCannell, and Blair Hancock, named among Washington’s top lobbyists in the annual list published by The Hill. It’s a particular honor to be listed alongside our friends and clients Tori Emerson Barnes of US Travel Association and Tim Daly and Jillian Pevo Coughenour of Western Union. As the article notes, lobbyists this year “played a key role in shaping an avalanche of legislation in 2022,” including the Inflation Reduction Act, the CHIPS and Science Act, and—fingers crossed—the National Defense Authorization Act (NDAA), which the House passed this week with amendments to be approved by the Senate. It’s been a long year but a successful one, and we’re grateful to be able to do this work for you.
McHenry to chair House Financial Services Committee
As expected, the Republican Steering Committee chose Rep. Patrick McHenry (R-NC) to chair the House Committee on Financial Services in the 118th Congress at its meeting on Wednesday. McHenry has served as that committee’s ranking member since 2019; he previously chaired the Subcommittee on Oversight and Investigation. He has been a member of the Financial Services Committee since his service in the House of Representatives began in 2005.
Republicans chose Rep. Tom Cole (R-OK) to chair the House Rules Committee, Rep. Jim Jordan (R-OH) to chair the House Judiciary Committee, Rep. Glenn “GT” Thompson (R-PA) to chair the House Agriculture Committee, and Rep. Bruce Westerman (R-AR) to chair the Committee on Natural Resources. The Steering Committee was not able to reach agreement on the leadership of several other major committees, including Ways & Means, Budget, Education & Labor, and Homeland Security. Those positions may not be settled until after the House elects a Speaker on January 3.
McCarthy announces China Select Committee, with Gallagher as chair
House Republican Leader Kevin McCarthy (R-CA) announced yesterday that Rep. Mike Gallagher (R-WI) will chair a new Select Committee on China, building on the Republican-led China Task Force. McCarthy called the Chinese Communist Party (CCP) “the greatest geopolitical threat of our lifetime,” and called for a whole-of-government approach to address the security and economic challenges the CCP poses. Gallagher, elected to the House in 2016, spent seven years as a Marine, with two tours in Iraq, before becoming a senior staff member of the Senate Foreign Relations Committee. He holds a PhD in International Relations and currently serves on the House Armed Services Committee.
Senate Democrats elect leaders
The Senate Democratic Caucus met yesterday to choose its leaders for the next Congress, reelecting Senator Chuck Schumer (D-NY) as Majority Leader and Senator Dick Durbin (D-IL) as Majority Whip. Senator Patty Murray (D-WA) will serve as Senate president pro tem; Senator Debbie Stabenow (D-MI) will chair the Democratic Policy and Communications Committee (DPCC); and Senator Amy Klobuchar (D-MN) will chair the Steering Committee.
SEC may propose new equity trading rules
The Securities and Exchange Commission is ending the year with a jam-packed meeting next Wednesday. The agenda includes a vote on a proposed amendment to insider trading rules, as well as votes on whether to propose amendments to Regulation NMS that would set new requirements for disclosure of order execution, make changes to order pricing and disclosure, and require that certain retail equity orders be exposed to competition through auctions. The Commission will also discuss proposing a new Regulation Best Execution, which would set a standard, require detailed policies and procedures for brokers and dealers, and impose new conflict of interest rules.
Confirmations, Nominations, Departures
Senator Raphael Warnock (D-GA) won reelection in Tuesday’s runoff election, giving Democrats a 51-seat Senate majority for the 118th Congress.
Senator Kyrsten Sinema (I-AZ) announced this morning that she is changing her party affiliation from Democrat to Independent. She will continue to caucus with Democrats, as fellow Independents Angus King (ME) and Bernie Sanders (VT) do, and is not expected to lose seniority on her committees.
Yesterday the Senate confirmed the nomination of Shailen Bhatt to serve as Administrator of the Federal Highway Administration, by voice vote.
The Week Ahead
December 15 is still the target date for Congress to adjourn sine die. December 16 is the expiration date of the current federal spending bill. It’s going to be a busy week.
December 12 at 1:00 p.m. The Federal Housing Finance Agency continues its roundtables on “The Federal Home Loan Bank System at 100: Focusing on the Future” with a session in Baltimore that focuses on FHLB support for communities of color and closing the racial wealth gap.
December 12 at 5:30 p.m. Senate Banking Committee meets in executive session to consider the nominations of Martin J. Gruenberg to be a member and Chair of the Board of Directors of the Federal Deposit Insurance Corporation (FDIC); Travis Hill to be a member and Vice Chair of the FDIC Board; Jonathan McKernan to be a member of the FDIC Board; and Dr. Kimberly Ann McClain to be an Assistant Secretary of Housing and Urban Development.
December 13 at 10:00 a.m. House Committee on Financial Services holds a hearing on “Investigating the Collapse of FTX, Part I.”
December 13 at 10:00 a.m. Senate Commerce Subcommittee on Communications, Media, and Broadband holds a hearing on “Ensuring Solutions to Meet America’s Broadband Needs.”
December 13 at 2:30 p.m. Senate Banking Subcommittee on Securities, Insurance, and Investment holds a hearing on “Examining How Capital Markets Serve Diverse Entrepreneurs and Investors.”
December 14 at 10:00 a.m. House Financial Services Committee holds a hearing on the semi-annual report of the Consumer Financial Protection Bureau (CFPB). Director Rohit Chopra will be the only witness.
December 14 at 10:00 a.m. Senate Banking Committee holds a hearing on “Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers.”
December 14 at 10:00 a.m. Securities and Exchange Commission meets to consider five sets of regulatory changes, including whether to propose new rules to establish a best execution standard.
December 14 at 2:30 p.m. Senate Committee on Small Business and Entrepreneurship holds a hearing on improving access to capital in underserved communities, focusing on the Community Advantage program, microloans, and other Small Business Administration initiatives.
December 15 at 10:00 a.m. Senate Banking Committee holds a hearing on the Consumer Financial Protection Bureau’s semi-annual report to Congress. CFPB Director Rohit Chopra will be the only witness.
December 15 at 1:00 p.m. The Federal Housing Finance Agency continues its roundtables on “The Federal Home Loan Bank System at 100: Focusing on the Future” with a session in Philadelphia that focuses on FHLB membership requirements, collateral, and safety and soundness.
The Ellis Insight - Jim Ellis on political news
PRESIDENT
Primaries: The DNC’s Rules & Bylaws Committee approved President Biden’s suggested alterations for the 2024 primary schedule. This means that South Carolina moves into the first primary position on February 3, 2024. Following on February 6 will be New Hampshire and Nevada. The newcomers to the early group are Georgia, slated for February 13, and Michigan two weeks later on February 27.
Republicans say they will maintain the traditional schedule kicking off with the Iowa Caucus and New Hampshire primary with Nevada and South Carolina following. The New Hampshire Democrats are objecting to being moved from the first primary position and state law allows them to ignore a political party’s rule. Though this is the first definitive step to nomination rules changes, more details must be finalized before any schedule takes effect.
SENATE
Florida: Quelling political speculation that he would run for President in 2024, Sen. Rick Scott (R-FL) early this week made clear his intentions for the next election. Saying in a response to a question from radio host and national commentator Hugh Hewitt, Sen. Scott said, “I have no plans to run for President and I have a 100% plan to run for the US Senate [in 2024]. I’m running for re-election for Senator from the great state of Florida.”
Speculation is also surfacing that outgoing US Rep. Stephanie Murphy (D-Winter Park) may challenge Sen. Scott. In a response to a reporter’s inquiry, Rep. Murphy didn’t close the door on such an option and pointed out that Florida is still not as “red” as the electorate voted in the 2022 election. Of the 11 Republican in-cycle seats for 2024, the Florida campaign could be the most competitive, but even here Sen. Scott must be rated a heavy early favorite for re-election.
Georgia: As predicted, Georgia Sen. Raphael Warnock (D) defeated GOP former professional football player Herschel Walker (R) in the Senate runoff election, but the approximate 51-49% contest was much closer than many prognosticators expected. The Warnock win gives the Democrats a 51-49 majority in the Senate, a net gain of one seat from the present 50-50 split. The outright majority will give the party at least one more vote than the Republicans on every Senate committee and make it easier for the leadership to confirm Administration appointments, including federal judges.
The secondary election was necessitated under Georgia election law because neither Sen. Warnock nor Mr. Walker received majority support in November. Unlike in most states, an absolute majority is required to win a Georgia general election.
Sen. Warnock has now secured a full six years in the Senate after winning the 2020 special election to fill the balance of then-Sen. Johnny Isakson’s (R) final term. Sen. Isakson resigned at the end of 2019 due to health reasons and then later passed away. Gov. Brian Kemp (R) then appointed businesswoman Kelly Loeffler (R) to fill the post until the 2020 special election of which Rev. Warnock won in that cycle’s subsequent runoff.
Indiana: Early political reports coming from the Hoosier State suggest that Gov. Eric Holcomb (R) will not pursue a 2024 US Senate bid when his tenure as Governor comes to an end. Mr. Holcomb is ineligible to seek a third term.
When asked about running for the Senate this week on wishtv.com, however, Gov. Holcomb replied, "there’ll be time for me to think about the future in the future. But it would be next to irresponsible for me to take my eye off the job that I’ve got."
This response suggests the Senate race door is not fully closed and will certainly remain an option for Mr. Holcomb as time moves forward. With universal statewide name identification and the ability to quickly raise large amounts money, Gov. Holcomb has the luxury of waiting to make a decision until he sees how an open Senate field develops. First-term Sen. Mike Braun (R) is a clearly preparing a run for Governor, thus leaving his Senate seat open.
Reports from the state have also surfaced indicating that former Gov. Mitch Daniels (R), who has ruled out a run for his former job, is making moves to assess his chances for a political comeback in an open US Senate race.
Nebraska: Cornhusker State Junior Senator Ben Sasse (R) has now set January 8, 2023, as the date he will officially resign his elected position in order to become president of the University of Florida. Governor-Elect Jim Pillen (R), who will appoint a replacement for Sen. Sasse, has asked individuals who want to be considered for the Senate appointment to apply before December 23rd. One person who confirmed he will apply is outgoing Gov. Pete Ricketts (R).
In the open Republican gubernatorial primary back in May, Gov. Ricketts became actively involved and endorsed Mr. Pillen, a University of Nebraska Regent, over eight other Republican candidates including Trump endorsed businessman and rancher Charles Herbster. Mr. Pillen would win the Republican primary with four percentage point margin and claimed the general election with just under 60% of the vote.
Though others will apply for the soon-to-be vacant Senate position, Gov. Ricketts is viewed as the clear favorite for the early January appointment. The new Senator then will stand for election in 2024 to fill the unexpired portion of Sen. Sasse’s final term. The seat is next in-cycle for a full six-year term in 2026.
Ohio: Two Republicans are already reportedly beginning to test the waters about challenging three-term Sen. Sherrod Brown (D) in the 2024 election. Both Secretary of State Frank LaRose (R) and US Rep. Warren Davidson (R-Troy) are admitting to be at least considering entering the upcoming Senate race.
Sen. Brown was first elected in 2006, when he unseated then-Senator and now Governor Mike DeWine (R), and has averaged 53.4% of the vote in his three elections. Previously, Sen. Brown served seven terms in the US House, as Ohio’s Secretary of State, and in the state House of Representatives.
HOUSE
CA-13: The final unresolved House race was called last weekend, and California Republican John Duarte, an agriculture-related businessman, was projected a 565-vote winner over Democratic state Assemblyman Adam Gray (D-Merced). The victory gives the Republicans a 222-213 House majority and provides GOP Leader Kevin McCarthy (R-CA) a much-needed vote for Speaker, this one from a neighboring district part of which touches his own CA-20 CD.
The race is officially over even though final numbers have not yet been recorded. Mr. Gray conceded the race to Mr. Duarte and, since California has no automatic recount law the outcome is final.
CA-22: California Rep. David Valadao (R-Hanford) is tied for representing the most Democratic seat in the country that sends a Republican to the US House. Long Island Rep-Elect Anthony D’Esposito (R-Hempstead) holds the other. The FiveThirtyEight data organization rates both Mr. Valadao’s CA-22 and Mr. D’Esposito’s NY-4 at D+10.
Despite the odds stacked against him, Rep. Valadao was able to post a 51.5 – 48.5% victory over state Assemblyman Rudy Salas (D-Bakersfield) in November, who was arguably the most difficult opponent Mr. Valadao faced in his five winning electoral campaigns. Late this week, Mr. Salas, who risked his Assembly seat to run for Congress, filed a committee to seek a re-match in 2024. If he ultimately follows through and runs two years from now, this race will again become a top national Democratic conversion target.
GOVERNOR
Indiana: US Ambassador to the Holy See and former US Senator Joe Donnelly (D), who also served three terms in the House, is apparently not closing the door on entering the open 2024 Governor’s race back in his home state of Indiana. While Mr. Donnelly is serving as the Ambassador in Rome, most politico observers believe he will return to again run statewide.
Superintendent of Public Instruction Jennifer McCormick (D) has already filed a gubernatorial committee, but says she will make a final decision about running after the first of next year. Sen. Mike Braun (R) is in a similar situation to Ms. McCormick, as he, too, has filed a gubernatorial committee without making a formal announcement, but will likely do so as early as next week. Should Messrs. Donnelly and Braun run and win their party nominations, it would set up a re-match of the 2018 US Senate race, a contest that Mr. Braun won 51-45%.
In preparation for launching a gubernatorial bid, he just released the results of an internal poll. The study, from the Mark It Red research group (11/18-22; sample size not released), finds Sen. Braun opening with a large Republican primary advantage in what will be an open race for Governor. According to the survey results, Sen. Braun would lead Lt. Gov. Suzanne Crouch and venture capitalist Eric Doden, 47-10-5%, respectively.
West Virginia: Sen. Joe Manchin (D) said that he has not made up his mind whether to seek re-election, run for Governor, or retire. Sen. Manchin said he will make a decision about the 2024 election after the first of next year.
The interesting part of his statement is acknowledging that another run for Governor is an option on his political table. Before winning a special 2010 US Senate election, Mr. Manchin served as Governor from January 2005 to November of 2010, having won two elections to the state’s top elected post.
Early polling suggests he would not fare well in a Senate race against Gov. Jim Justice (R), who is ineligible to seek a third term, and Rep. Alex Mooney (R-Charles Town). This makes West Virginia the top early 2024 election cycle Republican conversion opportunity.
STATE AND LOCAL
North Carolina: The North Carolina partisan gerrymandering case that was heard before the US Supreme Court this week is a potential landmark case, but some North Carolina state political sources suggest the arguments may go by the proverbial wayside.
The high court will rule before the end of June, but before that occurs, the new North Carolina legislature may draft new redistricting plans for the US House, state Senate, and state House of Representatives. Since a court map is only an interim plan, the legislature can replace it with a permanent draw at any time.
If this occurs as described, and new maps are enacted — remember, in North Carolina, the Governor has no veto power over redistricting legislation — the action could render moot the case before the Supreme Court. If so, the issue of whether the Constitution views state legislatures as solely independent when handling redistricting could well go unanswered.