Donna Shalala Encapsulated Pelosi’s Embrace of Passivity as a Strategy

November 09, 2020

The American Prospect

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Democrats were expected to expand their House majority, but instead saw many seats slip through their hands. With several races uncalled, the majority could be cut by as much as seven to ten seats.

That includes the seat of Nancy Pelosi’s close ally Rep. Donna Shalala (D-FL), whom Pelosi chose for the CARES Act’s Congressional Oversight Commission (which monitors the Federal Reserve bailout). Shalala’s course over the past two years, from part of the promising blue wave to low-energy oversight leader, is the story of Democratic leadership in the 116th Congress in a nutshell.

Florida’s 27th Congressional District had been in Republican hands for three decades, but in 2018 the incumbent’s retirement created an opening. The race, between Shalala and Spanish-language news anchor Maria Elvira Salazar, was tight throughout. Salazar harped on Shalala’s lack of roots in the district (and her lack of Spanish language skills), while Shalala painted her opponent as a “cheerleader” for Trump. In a moment when many were desperate for someone to finally hold a lawless president accountable, Shalala prevailed.

Shortly after the pandemic struck, Shalala’s star rose. Not, as one might expect, because she had once led the apparatus that was so ineffectually responding to the public-health crisis. Instead, Speaker Pelosi tapped her to serve on the commission overseeing the CARES Act bailout. It was, on its surface, a puzzling choice—while Shalala had real expertise on health policy, her background hardly prepared her to examine the intricacies of Federal Reserve lending over and above other interested candidates. And it was really just another indication of the Speaker’s utter disinterest in holding the Trump administration accountable.

Pelosi appeared to want someone who would avoid being too aggressive. And Shalala was more than happy to play the role Pelosi had set out for her.

Her inauspicious tenure began with serious concerns over her financial conflicts of interest, concerns which quickly shifted into alarm at a pattern of legal violations and cover-ups. Financial-disclosure forms indicated that the freshman representative held stocks in several companies that stood to benefit from the CARES Act bailout, prompting calls for divestiture. Reassurances that the congresswoman had already sold the stocks raised a new question: Where were the mandatory transaction reports that she was required to file under the STOCK Act? Answer: They didn’t exist because she had not seen fit to follow the rules.

Whether this failure stemmed from a willful subversion of ethics law or mere negligence, it did not instill confidence in her ability to provide energetic or effective oversight leadership, when she couldn’t even be bothered with compliance herself. Several groups, including the Revolving Door Project, called for her to step down. After Nancy Pelosi reiterated that Shalala continued to have her support, however, it became clear she was not going anywhere.

While this rocky start might have spurred some to work harder, no such dynamic seems to be at play for Shalala. None of the qualms about her qualifications for such a critical oversight position, especially compared to the fellow freshman who had sought the position (Katie Porter), appears to have undermined her sense of entitlement in the role. Of course, what she considered to be qualifications—close relationships with the very people she has been charged with overseeing—others saw as a troubling sign that she would be soft on corruption. And her choice to denigrate close oversight as “nitpicking” overly focused on “mischief” did not help. With this as her opening message, it should hardly come as a surprise that she has not leveraged her role to maximum effect.

Structurally weak from the start, the installation of mostly lackluster leadership (with the exception of commissioner Bharat Ramamurti, who has tried valiantly to shed light on the bailout via his Twitter feed and op-eds) has further relegated the body to obscurity. Nearly eight months after being established, the commission still does not have a chair, a signal of the lack of seriousness about the enterprise. That spills over into its relative invisibility on the national stage; if the House leadership doesn’t care about this oversight panel enough to even name a leader, the media gets its cues to not care either. As billions of dollars pour out the door, quietly setting policy and shaping the economy for years to come, the public will suffer for this lack of an effective, dedicated advocate.

It’s not clear what Shalala hoped to achieve with her conciliatory posture, but if it was a second term, it clearly did not work. From small-business owners concerned about the survival of their business to homeowners in the district worried about coastal flooding accelerated by the Fed superfueling fossil fuel companies, aggressive oversight could have been a way for Shalala to fight for her constituents.

This is not to suggest that Miami-Dade County citizens voted against Shalala solely because of her oversight failures. While it was cited in opposition campaign ads, there were obviously other factors at play, particularly with Latino voters pulling away from Democrats in South Florida. It is, however, to say that viewing the oversight seat as an opportunity to not only achieve tangible outcomes, but dramatize the Trump administration’s corruption, could have helped her better make the case for a second term. In addition to being good policy, oversight is good politics.

Few lawmakers have internalized this maxim, despite ample opportunity to put it into practice over the last two years. Those that have, like Rep. Katie Porter, have widened their margins of support. The House Democratic Caucus more broadly, which has largely remained stuck under Nancy Pelosi’s thumb, vastly underperformed expectations.

It’s time to rip up this faux-savvy strategy of passivity with as much vigor as Pelosi tore Trump’s State of the Union address. To not only enact change in real time, but build power over the long term, lawmakers must approach their roles with energy and conviction. Failure to do anything else can only spell disaster.

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