Slideshow Exit, stage right: Key Republicans retiring this year

Published
  • January 15 2018, 8:15pm EST
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More than 30 Republicans have said they plan to retire at yearend, a significantly high level for the party in charge of Congress, the White House and Supreme Court.

Several key policymakers affecting banking are among those exiting, including House Financial Services Committee Chairman Jeb Hensarling and Sen. Bob Corker, a top GOP member of the Senate Banking Committee. Another retiring lawmaker, meanwhile, Sen. Orrin Hatch of Utah, could cause a change of leadership of the Senate banking panel as Chairman Mike Crapo may take control of a different committee.

Most observers see the departures as a clear indication that Democrats have momentum headed into the election. The opposition party typically gains seats in a midterm election year, and President Trump remains widely unpopular, with an approval rating below 40%.

"There are a few factors driving the House retirements," said Kyle Kondik, managing editor of Sabato's Crystal Ball at the University of Virginia's Center for Politics. "One is the political environment, which seems bad for Republicans, at least at the moment. Even safe-seat members might have an incentive to retire if they believe they will go from the majority to the minority, and swing-seat members may be worried about winning reelection and instead have decided to go out on their own terms."

Such factors appear to have persuaded lawmakers like Reps. Ed Royce and Darrell Issa, both of California, to retire. Both are from districts won by Hillary Clinton in 2016, signaling that Democratic opposition is likely to be strong.

But that is not the situation for Rep. Jeb Hensarling, the Texas Republican who chairs the House Financial Services Committee and whose seat is considered safe. But he was facing the end of his chairmanship due to GOP term restrictions.

"Many of these members are losing their chairmanships and they don’t want to go back to being a rank-and-file member in the majority or, even worse, the minority," Kondik said.

Still others, including Rep. Steve Pearce of New Mexico, are leaving one political office in an effort to gain another.

Following are the key Republicans set to leave at the end of the year.

House Financial Services Committee Chairman Jeb Hensarling

Of the pending wave of departures, House Financial Services Committee Chairman Jeb Hensarling is the most important for banks and credit unions.

The Texas Republican has been at the forefront of banking policy for far longer than the six years of his chairmanship. He was an outspoken and influential conservative voice during the debates leading up to the Dodd-Frank Act, frequently clashing with then-Chairman Barney Frank.

Hensarling is likely leaving because his term as chairman is due to expire at yearend. His impending exit has already provided an extra incentive to try and cut a deal on a longstanding policy goal of devising a new housing finance system. Though Hensarling has long pushed to get the federal government out of the mortgage market, but said last month that he was open to a government guarantee if it would help win bipartisan support.

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Sen. Orrin Hatch, R-Utah

It is not a shock that Sen. Orrin Hatch, 83, who chairs the Finance Committee, is announcing his retirement, likely paving the way for Mitt Romney to claim his Senate seat.

But his departure may set off a musical chairs for committee leaders, resulting in a new head of the Banking Committee even if Republicans keep control of the chamber.

Senate Banking Committee Chairman Mike Crapo, R-Idaho, is third in seniority among Republicans on the Finance Committee. He may want to trade up to what is viewed as a more prominent chairmanship, leaving an opening atop the banking panel. That would likely mean Sen. Pat Toomey of Pennsylvania would become chairman.

Crapo could face competition to chair the Finance Committee, including from Sen. Chuck Grassley, R-Iowa. He is a past chairman and still has two years of eligibility under Republican term limits. However, Grassley also currently serves as chairman of the Senate Judiciary Committee, another highly regarded panel.

Sen. Bob Corker, R-Tenn.

Sen. Bob Corker was a key player in the debate over the Dodd-Frank Act and has long been an advocate for housing finance reform. But he officially announced late last year that he would not run for re-election.

The decision appears in part related to a likely primary challenge. Though Corker was re-elected easily in 2012, he's viewed with skepticism by some on the right.

Since his decision, Corker has publicly tangled with President Trump — at one point Corker said that the White House was like an "adult day care center" — but more recently he appears to have made up with the president, traveling with him on Air Force One to Tennessee.

Rep. Ed Royce, R-Calif.

Rep. Ed Royce, a high-ranking member of the House Financial Services Committee, was thought to be a potential successor to the retiring chairman, Jeb Hensarling, next year.

But the California Republican said this month he would not run for re-election, likely because Trump's unpopularity would have made re-election difficult.

The departure is a blow to credit unions. Royce has been a fierce credit union advocate during his time in Congress, and is considered almost irreplaceable to that industry.

“Ed Royce and his support for credit unions is in a league of its own,” said Ryan Donovan, chief advocacy officer at the Credit Union National Association. “It would be unrealistic and imprudent to think that any member of Congress would come in and fill those big shoes.”

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Rep. Darrell Issa, R-Calif.

Rep. Darrell Issa, R-Calif., is not central to banking policy, but as the former chairman of the House Committee on Government Oversight, he launched investigations into the Obama administration's policies concerning the Troubled Asset Relief Program and the Financial Crisis Inquiry Commission.

More recently, Issa in 2014 pursued the Justice Department's Operation Choke Point, which targeted banks and payment processors that did business with high-risk firms. Issa echoed concerns by online lenders that the Justice Department was trying to shut down legal businesses.

Issa's retirement is not a shock. Though first elected in 2000, he barely won reelection in 2016, clearing by a small margin of roughly 3,000 votes.

But he may not be gone for long. Not long after announcing his retirement, media reports indicated that Issa may seek to run for re-election in a neighboring district considered more favorable to Republicans.

Rep. Steve Pearce, R-N.M.

Rep. Steve Pearce has been a reliably conservative voice on the House Financial Services Committee. He has pushed for regulatory relief for banks, and in particular sought to make it easier for lenders to provide mortgages for manufactured housing.

Pearce may prove an ally for banks in another role. He is leaving Congress to run for governor of New Mexico, though he faces an uphill battle. Political analysts say the race currently favors Democrats.

Sen. Jeff Flake, R-Ariz.

Sen. Jeff Flake was considered one of the most conservative voices in the Senate, but he announced his retirement for fear he would face a primary challenge that would knock him out of contention.

During his retirement speech, he launched an attack on President Trump, arguing that he was weakening political norms and hurting the Republican Party.

His loss isn't a substantial blow to banks, as his seat is considered safely Republican. However, Flake was a reliable vote on core banking issues, including voting to overturn the Consumer Financial Protection Bureau's rule to ban mandatory arbitration clauses in financial contracts.

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Rep. Luke Messer, R-Ind. (pictured at left with House Speaker Paul Ryan)

Rep. Luke Messer is another reliably conservative vote on the House Financial Services Committee who has blasted the Dodd-Frank Act, arguing it helped the big banks and federal regulators but hurt consumers. He said the bill had tightened credit for mortgages.

Messer also introduced a bill in 2017, now part of the House-passed Choice Act, that would allow a private company in an administrative proceeding with the CFPB to move it to civil court.

Messer is leaving his congressional seat to run for Senate. He won the straw poll Saturday for the GOP primary but faces several challengers to receive the nomination. If he wins the nomination, he will face off against Sen. Joe Donnelly, D-Ind., who is considered the most vulnerable Senate Democrat of the midterm election cycle.

Rep. Dave Trott, R-Mich.

Rep. Dave Trott beat a lot of Republicans to the punch last September, when he announced he would not run for re-election even though he was seen as likely to win.

Though he only joined the House Financial Services Committee in 2016, Trott had sharply criticized the Dodd-Frank Act and pushed for regulatory relief for banks.