House Democrats unveil America COMPETES Act

A quiet week in Washington, as both House and Senate were in District Work Periods. We’re hoping to escape a direct hit from the nor’easter expected this weekend, because next week’s schedule is filling up quickly.

House Democrats unveil America COMPETES Act
On Tuesday, the chairs of 11 House Committees jointly unveiled the text of the America Creating Opportunities for Manufacturing, Pre-Eminence in Technology and Economic Strength Act of 2022 (America COMPETES), the House’s companion bill to the Senate’s United States Innovation and Competition Act (USICA), which passed the Senate last June. Speaker of the House Nancy Pelosi said the bill would “supercharge our investment in CHIPS, advance manufacturing at home, strengthen our supply chain, transform our research capacity and advance our competitiveness and leadership abroad, plus many other key provisions.” It includes investments intended to reduce American reliance on Chinese products and technology, combat misinformation campaigns by the Chinese government, create foreign development projects to counter China’s Belt and Road Initiative, and impose sanctions for human rights offenses against the Uyghurs in Xinjiang. The House is likely to bring this to a floor vote as soon as next week, with a House-Senate conference to follow. President Biden called for legislators “to get this to my desk as soon as possible.”

Breyer to retire; Biden, Schumer promise quick action
Associate Justice of the Supreme Court Stephen Breyer announced yesterday that he will retire when the Court goes into summer recess this year, assuming a successor has been confirmed by then. President Biden said that it was a bittersweet day for him, noting that he and Justice Breyer had worked together when Breyer was Chief Counsel to the Senate Judiciary Committee. He pledged a “rigorous” selection process that would end in the nomination of the first Black woman to the Court. A nomination is expected by the end of February; Senate Majority Leader Chuck Schumer (D-NY) promised “a fair process that moves quickly” to confirm the nomination.

CFPB seeks comment on “junk fees”
This week the Consumer Financial Protection Bureau (CFPB) issued a request for information to solicit comments from the public, small business owners, nonprofit organizations, financial institutions, state and local government officials, and others about whether and how the Bureau should use its authority to reduce “junk fees,” such as punitive late fees and fees for overdrafts and non-sufficient funds. The Bureau said that these “back-end fees might obscure the cost of a product and undermine a competitive market.” Specifically, they’re asking for descriptions of consumers’ experiences with fees for things they believed were covered by a baseline price; unexpected fees for a product or service; fees that seemed too high for the service provided; and fees whose reasons were unclear. Comments are due to the CFPB by March 31.

SEC reopens comment period on proposed executive compensation rule
The public has an additional 30 days to comment on the SEC’s proposed rule that would require registered companies to describe how executive pay is tied to the company’s financial performance. The rule was originally proposed in May 2015, and is required by the Dodd-Frank Act. SEC Chair Gary Gensler said the Commission was “considering whether additional performance metrics would better reflect Congress’s intention,” due in part to changes in executive compensation practices since 2015. The new comment period will open as soon as the notice appears in the Federal Register.

SEC proposes new reporting requirements for private fund advisers
The Securities and Exchange Commission voted on Wednesday to propose amendments to its Form PF, the confidential reporting form used by certain SEC-registered advisers to private funds. The changes would require additional data reporting to help SEC supervise private fund advisers and protect investors, and to help the Financial Stability Oversight Council assess systemic risk. Chair Gary Gensler said he was pleased to support the amendments, which “would require certain advisers to hedge funds and private equity funds to provide current reporting of events that could be relevant to financial stability and investor protection.” The proposal will be open for comment for 30 days once it appears in the Federal Register.

Senate Banking nomination hearings for Fed candidate likely to be contentious
Senator Sherrod Brown (D-OH), Chair of the Committee on Banking, Housing, and Urban Affairs, wasted no time in scheduling a confirmation hearing for President Biden’s three nominees to the Federal Reserve Board: the Honorable Sarah Bloom Raskin to be Vice Chair for Supervision and Dr. Lisa Cook and Dr. Philip Jefferson to be Governors of the Board. The Committee will hear from the nominees next Thursday, February 3. Its ranking member, Senator Patrick Toomey (R-PA) said today that Committee staff had discovered “dozens of omissions” in the questionnaires submitted by Ms. Raskin and Dr. Cook, and that their “shoddy compliance” showed “a lack of respect for Congress and raises concerns about the nominees’ willingness to comply with future congressional inquiries.” Earlier this week, Toomey raised concerns about the lack of geographic diversity among the nominees, since Ms. Raskin and Dr. Jefferson reside in the Fifth Federal Reserve District, as do Chair Jerome Powell and Vice Chair Lael Brainard.

Federal Reserve affirms principles for monetary policy, announces plans for tightening
This week the Fed released a statement from the Federal Open Market Committee that lays out some specific plans for cooling the economy in response to rising inflation. While the Committee did not decide to raise the federal funds rate at its latest meeting, it said it “expects it will soon be appropriate to raise the target range.” The Fed’s net asset purchases, which have been slowing, will end in early March. The FOMC affirmed its Statement on Longer-Run Goals and Monetary Policy Strategy, which says that “inflation at the rate of 2 percent . . . is most consistent with the Federal Reserve’s statutory mandate” to promote maximum employment and stable prices.

Confirmations, Nominations, Departures

Rep. Jim Cooper (D-TN) announced on Tuesday that he will not seek reelection at the end of this, his 32nd year in office. Cooper serves on the House Budget Committee, and chairs the House Armed Services Subcommittee on Strategic Forces.

Diane Ellis, Director of the Federal Deposit Insurance Corporation’s Division of Insurance and Research, is retiring on May 31 after a 34-year career with the agency.

The Week Ahead

February 1 at 2:30 p.m. Senate Judiciary Subcommittee on Commerce, Justice, Science, and Related Agencies holds a hearing on “Expanding Broadband Access: Department of Commerce Broadband Programs in the Infrastructure Investment and Jobs Act.”

February 2 at 10 a.m. House Financial Services Subcommittee on Housing, Community Development and Insurance holds a hearing on “Housing America: Addressing Challenges in Serving People Experiencing Homelessness.”

February 2 at 11 a.m. House Transportation Subcommittee on Highways and Transit holds a hearing on “The Road Ahead for Automated Vehicles.”

February 3 at 10 a.m. Senate Committee on Banking, Housing, and Urban Affairs holds a hearing on the nominations of Sarah Bloom Raskin to be Vice Chair of the Federal Reserve Board for Supervision, and Dr. Lisa DeNell Cook and Dr. Philip Nathan Jefferson to be members of the Federal Reserve Board.

February 3 at 10 a.m. House Financial Services Subcommittee on Diversity and Inclusion holds a hearing on “Building Opportunity: Addressing the Financial Barriers to Women and Minority-Owned Businesses’ Involvement in Infrastructure Projects.”

The Ellis Insight - Jim Ellis on political news

SENATE
Arizona: The Data for Progress organization just released their major statewide poll in the Grand Canyon State of Arizona (1/21-24; 1,469 AZ likely general election voters; approximately 1/3 of which are likely Democratic primary voters; online & text). The DfP finds Sen. Mark Kelly (D) already falling into a tight battle with Attorney General Mark Brnovich, should the latter man win the GOP nomination. The ballot test projects Sen. Kelly holding a slight 49-47% edge but with a falling personal approval rating, 46:49% favorable to unfavorable.

Regarding Sen. Kyrsten Sinema, the poll finds deep trouble within her own Democratic Party, but she performs well among Republicans and breaks even with Independents in terms of job approval (20:76% among Democrats; 47:48% from Independents, but 66:26% among Republicans). In a preliminary 2024 Democratic primary pairing with Rep. Ruben Gallego (D-Phoenix), however, she would trail by a whopping 16-74%.

Georgia: Quinnipiac University released its first Georgia poll of the election season (1/19-24; 1,702 GA likely voters; 666 GA likely Republican primary voters; live interview) and finds Republican challenger Herschel Walker holding a slight 49-48% lead over Sen. Raphael Warnock (D) in what will be one of the most hotly contested races in the nation later this year. We can expect close polling in Georgia from today all the way through the November election.

Kentucky: With candidate filing officially now closed, The Mason-Dixon Polling & Strategy firm released the results of their new Kentucky statewide poll (1/19-22; 625 KY registered voters; live interview) and project Sen. Rand Paul (R) to be in strong position opposite his likely general election opponent, former state Rep. Charles Booker (D-Louisville). The ballot test gave Sen. Paul a 55-39% lead, with him carrying every region of the state with the exception of the Louisville metro sector.

HOUSE
CA-3: Sacramento County Sheriff Scott Jones (R), who challenged Rep. Ami Bera (D-Sacramento) in 2016 and lost in a 51-49% margin, announced that he will run in the new open 3rd District that stretches from the Sacramento suburbs all the way down the Nevada border into Southern California via Inyo County.

Sheriff Jones will at a minimum face state Assemblyman Kevin Kiley (R-Granite Bay), businessman Jim Scott (R), and physician Kermit Jones (D) in the June 7th jungle primary. The seat leans Republican, and carries a R+8 rating from the FiveThirtyEight statistical firm.

CA-13: Fresno Democrat Phil Arballo, a financial advisor who raised over $5 million in his 2020 challenge to then-Rep. Devin Nunes (R-Tulare) but lost 54-46%, was a candidate in the current special election to replace the resigned GOP Congressman in District 22. With the new redistricting map virtually eliminating that seat, meaning the winner will likely serve only one six-month term, Arballo has left the special election and announced he will run in new District 13, a Lean Democratic seat that touches the Fresno area and stretches to the San Joaquin Valley.

Mr. Arballo decided to run in CD-13 when Rep. Josh Harder (D-Turlock) announced that he was moving into retiring Rep. Jerry McNerney’s (D-Stockton) 9th CD. The CA-13 race is expected to be competitive. In the beginning, Mr. Arballo will at least face state Assemblyman Adam Gray (D-Merced) in the jungle primary scheduled for June 7th.

NE-1: Nebraska Rep. Jeff Fortenberry (R-Lincoln) is now seeing his federal indictment for campaign finance violations and allegedly lying to federal authorities hurt him politically. Last week, state Sen. Mike Flood (R-Norfolk), a former Speaker of the unicameral legislative body, announced that he would challenge the Congressman in this year’s Republican primary. Over the succeeding weekend, Gov. Pete Ricketts (R) and former Gov. Dave Heineman (R) both endorsed Mr. Flood’s challenge to Rep. Fortenberry, signaling a serious challenge ahead.

Ex-Gov. Heineman indicated that he is concerned about the Republicans winning in November against state Sen. Patty Pansing Brooks (D-Lincoln) should a politically crippled Fortenberry again become the party nominee. He also brought attention to the Lincoln Congressman being the only Nebraska member ever indicted. Gov. Ricketts supported his endorsement of Sen. Flood by saying the district would get “the full-time attention it deserves.”

TN-5: On passage of the new Tennessee congressional redistricting map that would significantly change the Nashville area, veteran Rep. Jim Cooper (D-Nashville) quickly announced that he will not seek re-election later this year.

Mr. Cooper is serving his 16th term in the House, winning his first election from the state’s east/southeastern 4th District in 1982, which he represented until he ran unsuccessfully for the US Senate in 1994. He returned to the House from the Nashville district in 2002 when then-Rep. Bob Clement (D-Nashville) left the seat to challenge then-Sen. Fred Thompson (R), the same man who defeated Mr. Cooper in his statewide bid.

During his second tour of duty in the House, Rep. Cooper was not seriously challenged for re-election. It appeared he was preparing for a Democratic primary challenge this year, but such is moot now that the new 5th District becomes decidedly Republican. Rep. Cooper is the 29th Democrat not to seek re-election. Counting the Democratic and Republican retirements along with the new and created (through redistricting) open seats, the House will see a minimum of 50 new members coming into office at the beginning of 2023.

Redistricting: In a surprising move from an Alabama three-judge Republican panel, the enacted GOP congressional map was declared void this week because it did not create a second African American district as the Democratic plaintiffs claimed it could. Immediately the Republican legislative leadership announced they will appeal the decision.

Upon filing their objection, the map would then go directly to the US Supreme Court, and the high panel must hear the redistricting challenges. As part of the ruling, the Alabama candidate filing deadline was moved from January 28th to February 11th. The court returned the map to the legislature ordering a new map by February 7th. If the GOP legislators follow through with their Supreme Court appeal, it is likely they will not respond to the court order.

In addition to Mississippi Gov. Tate Reeves (R) signing his state’s redistricting measures, state legislatures in Kansas, South Carolina, and Tennessee sent their congressional maps to respective Governors Laura Kelly (D), Henry McMaster (R), and Bill Lee (R). Gov. Kelly, because the map makes the Democratic 3rd District of Rep. Sharice Davids (D-Roeland Park) more competitive, is likely to veto the plan and send it back to the legislature. The Republican majority in the House may be a few votes short of having the 2/3 super majority to enact the map.

Govs. McMaster (SC) and Lee (TN) are expected to sign the legislatures’ redistricting bills. The South Carolina map strengthens the politically marginal 1st District for freshman Rep. Nancy Mace (R-Charleston), while the Tennessee plan will likely add one more Republican district to their state delegation at the expense of retiring Rep. Jim Cooper (D-Nashville).

GOVERNOR
Georgia: As shown above in the Georgia Senate post, Quinnipiac University released its first Peach State poll (1/19-24; 1,702 GA likely voters; 666 GA likely Republican primary voters; live interview), and their gubernatorial results are as close as what was found in the Senate race.

Matched with consensus Democratic candidate Stacey Abrams, the 2018 gubernatorial nominee and former state House Minority Leader, Gov. Brian Kemp (R) posts a small 49-47% lead. The Governor’s personal favorability, however, is upside down at 36:51%, while Ms. Abrams is better but certainly not stellar at 44:45% positive to negative.

In the Republican primary, Gov. Kemp leads former Sen. David Perdue, 43-36% with ex-DeKalb County Executive Vernon Jones pulling 10% support. If Mr. Perdue were the Republican nominee against Ms. Abrams, the two would be tied at 48%.

Illinois: The Victory Research firm tested Illinois Democratic Gov. J.B. Pritzker (1/18-20; 1,208 IL likely general election voters) against five potential Republican opponents. Businessman Gary Rabine (R) fares best against the Governor, but even he trails by a huge 52-28% margin. Gov. Pritzker remains in strong shape in his bid for a second term. Other tested GOP candidates are state Sen. Darren Bailey (R-Louisville), Aurora Mayor Richard Irvin, former state Sen. Paul Schimpf, and venture capitalist Jesse Sullivan.

Massachusetts: US Labor Secretary Marty Walsh, the former Boston Mayor, said that he will not return to Massachusetts to enter the open Democratic gubernatorial primary, choosing to stay in his present position. Earlier, Attorney General Maura Healey (D) said that she would run. Democrats are favored to convert this Governorship. Incumbent Gov. Charlie Baker (R) is not seeking a third term.

Michigan: Regular Michigan pollster EPIC-MRA (1/15-20; 600 MI likely general election voters; live interview) finds Gov. Gretchen Whitmer (D) leading former Detroit Police Chief James Craig (R) with a 46-41% margin according to the results of its latest survey.

Though Gov. Whitmer has an edge on the outside of the polling margin of error, there are several negative points that should worry her. In a ratio of 35:45%, the respondents believe Michigan is on the wrong track. Her job approval stands at 45:52% positive to negative. Perhaps the worst part of the survey for Gov. Whitmer, however, is that President Biden’s job approval is a woeful 32:66% positive to negative, and the respondents rate the economy only 29:65% positive to negative.

Ohio: A Fabrizio Lee research firm survey (1/11-13; 800 OH likely Republican primary voters; live interview) finds GOP Gov. Mike DeWine, one of the leading Covid shutdown Governors, in trouble against his Republican primary opponent, former Congressman Jim Renacci. According to the poll, Mr. Renacci would top Gov. DeWine in his quest for re-nomination by a surprising 46-38% margin.

The Governor’s job approval rating among Ohio Republicans is a poor 48:49% positive to negative and his personal approval ratio is an even worse 44:52%, with 33 of the 52% saying very unfavorable. Mr. DeWine’s re-elect score is troublesome for any incumbent. A full 50% of his own party respondents say they definitely or probably won’t vote for DeWine. This race has been rather quiet to this point, but the May 3rd Republican gubernatorial primary has just become much more interesting.

On the Democratic side, former Dayton Mayor Nan Whaley released her Clarity Campaign Labs poll that posts her to a 33-20% lead over ex-Cincinnati Mayor John Cranley in the battle for their party’s gubernatorial nomination.

Rhode Island: Rhode Island General Treasurer Seth Magaziner (D), one of five Democrats challenging new Gov. Dan McKee (D) in the party primary, announced that he will end his statewide campaign and instead enter the open RI-2 congressional district race for the office from which veteran Rep. Jim Langevin (D-Warwick) is retiring.

Mr. Magaziner’s departure leaves Secretary of State Nellie Gorbea, former Secretary of State Matt Brown, corporate CEO and Harvard University Board Member Helena Foulkes, and physician Luis Daniel Munoz in the nomination race. The Rhode Island primary isn’t until September 13th.