WASHINGTON-With NAFCU's Congressional Caucus starting this week and Labor Day marking the unofficial start of the fall campaign season, Credit Union Journal spoke with several political observers to get a better idea of how the mid-term elections could impact the community.
One of the most crucial components for credit unions during this election cycle, say experts and insiders, is whether the Republicans can take back the U.S. Senate.
If that happens, a number of credit union-friendly regulatory measures could come up for a vote, said Katie Marisic, VP of political affairs at NAFCU.
Marisic cited legislation such as privacy notice requirements and interest on lawyers' trust accounts that have passed the House but stalled in the Senate as items that would likely move forward in a GOP-controlled Senate.
"Those have passed the House, so it seems like the Republicans are more likely to deal with some of the regulatory burdens that have come from Dodd-Frank," she said. "They have not been quiet about their desire to do GSE reform, so there's a chance that could come up, and I'm sure there are a lot of other issues outside of the credit union realm that we've been hearing them talk about that could come up as well."
Chief among those is Obamacare, but there are a host of other, arguably higher-profile items on the GOP's agenda that could get their moment in the spotlight before credit union issues come to the fore.
So if the Republicans control Congress, how soon will it be before they actually get to credit union issues?
"That's impossible for me to answer," said Marisic. "I do think that because these have been issues that have come up repeatedly in the House, if the Republicans take back the Senate they would probably try and work as quickly as possible to make it look like there as forward movement in pieces of legislation."
Regardless of which side controls the senate, CUNA's Richard Gose, SVP of political affairs, noted that each party has its own set of issues, and credit unions generally do well on both sides of the aisle.
"Republicans, for example, are typically about less regulation, while Democrats are maybe a little bit more amenable to a cooperative structure," he said. "You can never tell, but I don't see it being a major difference. Most bills that are ultimately passed are bi-partisan bills."
Trey Hawkins, CUNA's VP of political affairs, added that because credit unions are a bi-partisan industry, credit unions have less to fear from changing political winds than other industries.
"If you are given completely to one side and the other side wins, they're not going to look favorably on you," Hawkins said. "We'll be well positioned whatever happens. The issues and the types of bills in the mix might vary, but we're confident we have friends on both sides of the aisle, so we don't worry too much about which side has control."
"Even if the Republicans take both chambers, they're not going to have veto-proof majorities, so that's really the end of the discussion," said John McKechnie, a former CUNA staffer who is not a partner at D.C.-based consulting firm Total Spectrum. "They may pass a lot of things to their liking, but [President Obama] isn't going to sign them into law without significant Democratic support. If the Republicans choose to reach across the aisle and try to attract centrist Democratic support for GSE or CFPB reform proposals in a way that can get to a veto-proof proposal, the president may have to sign it. The only hope is that they decide to pass a bill that's actually designed to become law, rather than one that's just meant to make a political point."
Individual Races Vs. Bigger Picture
Credit union political observers have identified multiple races that they believe are important to the community, and the first name NAFCU and CUNA reps mentioned was Mark Udall, the Democrat senator from Colorado facing a challenge Rep. Cory Gardner (R-Col.).
"Udall has been the author and sponsor and champion of member business lending in the Senate for credit unions, and we've got credit unions in the state that are engaged and reaching out to their members and encouraging them to vote for Udall," said Hawkins. "The banking industry has put a target on his back as somebody they'd like to take out because of his support for credit unions."
NAFCU is also supporting Udall, who Marisic noted has always been "willing to stand up and be on the record when it comes to credit union issues," citing his willingness to introduce standalone MBL legislation for credit unions. "He's someone we'd love to see come back to the Senate."
As far as open seats, both trade groups are also actively supporting U.S. Rep. Shelley Moore Capito (D-W.V.), running to succeed retiring U.S. Sen. Jay Rockefeller. Moore Capito, a member of the House Financial Services Committee, has been an important co-sponsor on credit union issues, said Marisic, pointing specifically to examination fairness and interchange as examples.
McKechnie, on the other hand, pointed out that the number of races each party wins is just as important as individual races.
"In both chambers, it's likely that the Republicans are going to pick up single-digit numbers of seats," he said. "The question really is if the Republicans pick up four, they don't get the majority; if they pick up eight, they probably do."
But, he added, there will be a few intricacies that complicate matters.
For example, a Louisiana law that requires a run-off election if no candidate receives 50% of the vote, means that the results of U.S. Sen. Mary Landrieu's (D-La.) campaign may not be known until December, making it difficult to determine which party holds the majority.
Further complicating things, said McKechnie, are Senators such as Angus King of Maine, an Independent who caucuses with the Democrats. King, said McKechnie, "has already declared that he's not committing to caucusing with anybody and instead of seeing that as opportunistic, people in Maine seem to like that and think he's trying to cut the best deal for their state."
Sen. Joe Machin (D-W.V.) is a conservative democrat who has also "always seemed to be somewhat uncomfortable with his party's national agenda," said McKechnie, which could also help tilt the balance toward the Republicans.
The Election After The Election
Regardless of which party controls Congress, one factor that could hamper progress during the upcoming Congressional term is the 2016 presidential election.
But those who spoke with CU Journal offered differing opinions on what role the next election might play in the next legislative cycle.
"People always think the world is going is going to be on hold because there's a presidential election coming up," said CUNA's Gose. "If you look at history, there's been a lot of legislation passed during presidential years. Some of it for political reasons, some because it's the last chance of an administration or certain retiring members can pass something they want to see passed. You have a lot of different agendas going on."
Time is also a factor for both parties.
McKechnie noted that during Obama's final two years in office it is "probably going to be very difficult" for the president to move a proactive agenda, but the Republicans may also be on a time crunch.
"Republicans have to be somewhat cautious about the fact that they have a fairly narrow window to get things done in the next two years, because I think 2016 is going to be a very different year than 2014, politically," McKechnie said, noting that all the Republicans elected in 2010 will be up for re-election next time around.
"Republicans have to get things done in the next two years, otherwise they may not get their agenda passed," he said. "They may well look at this as a two-year majority. They should be focusing that way, because that's the reality. That gets back to the idea of them trying to pass legislation that is a bit more bipartisan, because getting something is better than getting nothing."
The good news for credit unions during the upcoming term, said NAFCU's Marisic, is that being friendly on both sides of the aisle has its benefits. "Credit union issues aren't necessarily Democratic or Republican issues; it's something that goes across the aisle," she said. "We've got a credit union member in every single Congressional district, so we're lucky in that particular thing when we go to the Hill and lobby on those issues. I think that puts us almost in a more optimistic light than people with other issues, because we can go to the Hill and talk about the good work our [credit unions] are doing. And Congress knows that and sometimes will have a tendency to listen to us."
