Inside Financial Services

Let’s Get These Banking Confirmations Moving

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From American Banker, last week:

Democrats are growing increasingly frustrated with delays to the confirmation process this year, particularly with the Senate Banking Committee which has 11 pending nominees before it.

Most recently President Obama named Kathryn Dominguez to fill the second of two open slots on the Federal Reserve Board, but few expect the Senate to vote on her—or many others—anytime soon.

The Senate Banking Committee is sitting on eleven pending nominees? I enjoy watching partisan gridlock as much as anyone, but even I will admit that certain government tasks really are important, and that qualified people ought to be in place to carry them out. One of the held-up nominees, for example, is Adam Szubin, who was tapped in April to serve as undersecretary of the Treasury for terrorism and financial crimes. That sounds like the sort of job that, one would think, both Republicans and Democrats would agree somebody ought to be in place doing diligently and full-time. At least Richard Shelby, the Republican who heads the Banking Committee, has set a confirmation hearing for Szubin—although it won’t happen until Sept. 10, after Congress returns from its summer break and a full five months after Szubin’s nomination. The delays for others are just as mysterious. Just when did Senate confirmation of, for instance, the director of the mint (ignored nominee: Matthew Jeppson) become a political football? Or Federal transit administrator (Therese McMillan)?

My understanding is that Shelby’s holding things up because President Obama refuses to nominate someone, as is required by Dodd-Frank, to the newly created position of Fed vice chair for supervision. The individual will be required to testify in front of Congress twice a year and so will be subject to some level of Congressional oversight. Obama is said to prefer to let Fed board member Dan Tarullo continue to oversee supervision on an ad hoc basis, not subject to oversight.

Wait a minute. If the president thinks Dodd-Frank—which only Democrats voted for, remember—is so vital to reforming the financial system and preventing another meltdown, I’m amazed that, five years after the law’s enactment, he hasn’t thought that it’s important enough to appoint a head of supervision. As for Congressional Democrats, this is their law! One would think they’d be as eager as Republicans to carry out oversight of bank supervision—if not more so. Instead, they seem to be MIA on the issue.

I can see Shelby’s objection broadly. But I also like to think that there are some government functions that are important enough that they rise above politics—and suspect that, say, combatting terrorism and cybercrime might be one of them.  The country can go without a director of the mint for a while longer, I suppose. Surely Sen. Shelby can find a way to spur the president to nominate a vice chair for supervision without shutting down the confirmation process entirely.

What do you think? Let me know!

4 Responses to “Let’s Get These Banking Confirmations Moving”

  1. Avatar Doug

    Agreed. Years ago, positions like the director of the Mint and lower level Judge appointees were confirmed out of respect for the President. If you didn’t like the nominee, too bad, the other party won. Supreme Court Justice and other high post warrant increased scrutiny, but they aslo warrant action. The ATF hasn’t had a permanent director since 2006, that’s two different administrations.

    • Avatar Paulo

      Life is short, and this article saved vaubllae time on this Earth.

  2. Avatar Bill Demmin

    I can understand why there are more and more folks who are independent. Neither of the 2 major parties seem to understand that politics involves negotiations and compromise and to implement policy and take reasonable actions. Actions like run of the mill nominations should be handled as routine without delay and stalling.

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