White House, Democrats urge Senate Republicans to support Watt as top housing regulator

The White House made another plea on Wednesday for the Senate to confirm Mel Watt as one of the nation’s top housing regulators.

The North Carolina Democrat’s nomination is scheduled for a procedural vote on Thursday that, if successful, would pave the way for Watt to become the first confirmed director of the Federal Housing Finance Agency (FHFA) since the government took control of mortgage giants Fannie Mae and Freddie Mac in 2008.

National Economic Council Director Gene Sperling reiterated that Watt’s confirmation is “a top economic priority for this White House” and would provide “much needed certainty for the housing market and a much better foundation” to implement housing finance reform policies that can drive the sector’s recovery.

“I’m still waiting to hear a single good reason for voting against him,” Sperling told reporters on a conference call. 

He called it “unprecedented for a sitting member of Congress to be filibustered” and urged the Senate to end debate and give Watt and up-or-down vote. 

Housing and Urban Development Secretary Shaun Donovan told reporters on Wednesday that Watt should be confirmed because he has a “wealth of experience and knowledge” and has “worked tirelessly to expand economic opportunities for the middle class.”

Watt, who has served on the House Financial Services and Judiciary committees for the better part of 20 years, has faced Republican opposition since President Obama first announced his nomination in the spring.

He is not expected to garner the 60 votes needed to move forward to a final vote. Watt’s nomination was approved on a party-line vote by the Senate Banking Committee in July. 

Senate Republicans have argued that the Watt’s nomination is too political and that he would align himself with the housing principles being pushed by the White House instead of focusing on minimizing taxpayer exposure. 

They have expressed support for acting director Edward DeMarco, who has held that position for more than four years. 

Watt supporters have cast him as a consensus-builder who would do whatever necessary to overseeing the gradual wind down of Fannie and Freddie that would be implemented as part of any comprehensive legislation cleared by Congress. 

Senate Banking Committee Chairman Tim Johnson (D-S.D.) criticized Republicans for trying to block Watt because “he is a politician, not a technocrat.”

“But they forget that Congressman Watt has over 40 years of experience in housing, real estate and other financial services issues,” Johnson said on the Senate floor Wednesday. 

“If we had all listened to Congressman Watt before the housing crisis, then thousands of consumers might have avoided being scammed into unsafe mortgages that ultimately led to foreclosure,” he said. 

“There is no legitimate reason Congressman Watt should not be confirmed.”

House Financial Services ranking member Maxine Waters (D-Calif.) said Watt “is known as a legislator focused on openness, collaboration and good public policy. And he knows how to get things done.”

“I believe Mel Watt has the vision and experience necessary to lay the groundwork for its long-term stability. This is particularly needed as Congress begins to consider reforming a $10 trillion secondary mortgage market.”

Watt probably has about 58 votes, short of what is needed, which includes the support of colleague Sen. Richard Burr (R-N.C.). 

He does have the backing of many industry groups such as the National Association of Homebuilders, the National Association of Realtors and the Mortgage Bankers Association who have highlighted his decades of private and government experience, giving him unique insight into the inner-workings of the mortgage market. 

Amid the flood of support remained rumblings of opposition. 

The conservative Club for Growth and Heritage Action released statements on Wednesday urging senators to vote against Watt each saying they would key vote the cloture motion. 

“Congressman Mel Watt is not at issue — the policies he will pursue as head of FHFA are,” said Club for Growth President Chris Chocola. 

“Mel Watt will almost certainly pursue a write-down of mortgage debt, which is a massive taxpayer-subsidized bailout that would create a massive moral hazard.”

Heritage Action said it opposes the Watt nomination because his “past positions suggest he’ll be very aggressive in implementing many of the bad policies currently being blocked by the agency’s acting director, Edward DeMarco.”