Affordable housing could be the surprising beneficiary of a switch to Republican control of the Senate.
Republicans, under a Sen. Richard Selby-chaired Senate Banking Committee, might "target lack of access to affordable housing" to gain a reputation for producing legislative results, Michael Borden, a counsel for Silbey Austin, said Monday at the Mortgage Bankers Association annual convention in Las Vegas.
His fellow panelist Paul Bock, a partner at Holland and Knight, agreed. If Republicans regain control of the Senate, current Minority Leader Sen. Mitch McConnell of Kentucky "has got to pass some bills" and "put some points on the board" (assuming Sen. McConnell, wins re-election).
But the panelists also suggested chances are good legislative gridlock will continue even if Republicans have control of both chambers, with mortgage issues like government-sponsored enterprise reform casualties of the standoff.
Edward Hill, a public policy executive for Bank of America, said a Republican-controlled House and Senate is a likely outcome. If so, Republicans "will have to show how they can govern," he said. They will need to avoid "narrowly tailored ideas," especially on the House side, "and target ideas that can get bipartisan support." Next year, before the Presidential election of 2016 revs up, might be a window of opportunity for such efforts.
Borden estimated an 80% chance Republicans will win the Senate, while Bock said he thinks it possible there will be a 50-50 split, which would give Vice President Joe Biden the tiebreaker as President of the Senate.
If the GOP takes both houses, look for an aggressive attempt to rein in the Consumer Financial Protection Bureau, said Borden, and install a five member ruling commission to replace the single director in effect now.
Borden said he thought regional and super-regional banks might be beneficiaries in the next Congress, as there may be a "sweet spot" to relieve some of the regulations on them.
Bock said it would be important for Republicans to work with Democrats, though he said this may take a big effort and be the domestic equivalent of Nixon going to China.
Borden disagreed, pointing to cooperation between Sens. Bob Corker, R-TN and Mark Warner, D-VA and Sens. Tim Johnson, D-SD, and Mike Crapo, R-ID on GSE reform.
Bock said the continuing dysfunction of Congress means any changes from a change in control may be modest. "It matters [which party is in power], but it’s not dramatic," he said.
Borden disagreed there as well, saying the switch would be "really significant" as Republicans would set the agenda. At a Senate Banking Committee under Shelby (Republican of Alabama), "the focus of the committee would be dramatically different."
