Senate Panel Considers Mel Watt’s Confirmation and GSE Reform

The coming week could be an important milestone in the march toward GSE reform as the White House comes under pressure to reveal its approach to winding down Fannie Mae and Freddie Mac.

The confirmation hearing on the president’s pick to be the new GSE regulator is slated for June 27.

When President Obama nominated veteran congressman Mel Watt, D-N.C., to be the new Federal Housing Finance Agency director, Senate Republicans demanded that the White House reveal its plan for housing finance reform.

In other words, the GOP will block Watt’s confirmation unless the Obama administration produces its plan for dealing with Fannie and Freddie, which are in conservatorship and under government control.

Sen. Bob Corker, R-Tenn., has been working on a measure to wind down Fannie and Freddie over five years and create a federally chartered insurance agency to provide a backup for a new secondary market regime.

Rumors are circulating that Corker will release his bill before Watt’s confirmation hearing on Thursday. But the senator’s office says it is working toward introducing the bill before the July 4 recess.

Sources indicate Corker is trying to round up more co-sponsors for the GSE reform bill he has crafted with Sen. Mark Warner, D-Va. The Tennessee senator is hoping to get Sens. Elizabeth Warren, D-Mass., David Vitter, R-La., Jon Tester, D-Mont., and Mike Johanns, R-Neb., as co-sponsors.