With an immediate disclaimer that I actually was a Republican before Election Day, I can make some very preliminary, semi-educated guesses about the track the GOP will take following the landslide that gave them majorities in both the House and Senate for the first time since 2006.
For credit unions, I'd watch four issues for attempted action by the Republicans. President Obama is likely to veto the more ambitious parts of the GOP agenda, and attaining two-third of the House and Senate to override is mathematically and politically daunting.
Tax reform
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Much chatter has already circulated around Capitol Hill about Republicans making tax reform a priority. Incoming Ways and Means Chairman Paul Ryan (R-Wis.) has said he believes tax reform is "achievable and necessary," but he has also complicated the road to passage by stating that reform means both corporate, which could mean the credit union tax exemption is on the table, and individual tax reform.
Since the White House has indicated a preference for a corporate-only approach, that's already an issue to be resolved before the next Congress is even seated.
Dodd-Frank reform
If tax reform is contentious, efforts to repeal or even tweak the landmark Dodd-Frank law will be an all-out donnybrook by comparison. New Senate Banking Committee Chairman Richard Shelby (R-Ala.) will take aim at the CFPB and will be joined enthusiastically by House Financial Services Chairman Jeb Hensarling (R-Texas).
Controversy surrounding big ticket Dodd-Frank items may pave the way for regulatory relief issues of importance to credit unions and other small institutions. This is worth credit unions spending time proposing a variety of Dodd-Frank exemptions to ease our regulatory burden. Supplemental capital, anyone?
Housing finance reform
Similar to Dodd-Frank, Shelby and Hensarling are united in a desire to shrink the federal footprint in housing finance, eliminate Fannie and Freddie, and foster the flow of private capital into the system. However, they may be a minority in a majority as significant numbers of Republicans want to maintain a robust government presence in the housing finance market.
Data security
While there's support on both sides of the aisle for mandatory consumer notification for retailers, there is an equal amount of opposition. The dynamic here is not going to be noticeably different in the 114th Congress.
John McKechnie III is a partner at Total Spectrum. He can be reached at 202-544-9601 or [email protected].
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