July 22, 2019
Jeff Hauser and David Segal
The American Prospect, July 22, 2019
Already furious that Democrats aren’t standing up for themselves and the people who depend on them? Then … this article isn’t for you. Because we’re going to tell you about a seemingly inside baseball—but in fact quite consequential—way in which Senate Minority Leader Chuck Schumer continues to be out-hustled by both Donald Trump and Senate Majority Leader Mitch McConnell.
One of the cool things about leading the Senate party not in control of the White House is that for the past generation, you have gotten to choose your party’s “minority commissioners” on a wide swathe of independent agencies. That opportunity exists because critical five-member independent agencies like the Federal Trade Commission (FTC), National Labor Relations Board (NLRB), and Federal Communications Commission (FCC) are governed by statutes with requirements such as the law that created the FTC: “Not more than three of the Commissioners shall be members of the same political party.”
As we explained last month, this process has broken down under Trump, McConnell, and Schumer. Not only have Trump and McConnell destroyed pre-existing norms, but Schumer and the Democrats have been bizarrely quiet about it. But while the bigger picture requires attention, so do the smaller details. And just as with the bigger picture, on smaller details we worry that McConnell continues to this day to run circles around a seemingly low-energy Schumer.
Consider the Securities and Exchange Commission (SEC), the putative “cop on the beat” for Wall Street. Throughout the spring of 2018, progressives like us pushed Schumer to move faster on identifying a Democratic commissioner to succeed Kara Stein, whose term technically expired in 2017, and who could only hold her seat until the end of 2018. Those calls became more urgent when Republican commissioner Michael Piwowar announced on May 7, 2018, that he would step down in two months.
Mitch McConnell arguably understands, pursues, and wields power in Congress more effectively than anyone since Lyndon Johnson. So what came next was clear to McConnell. Less than a month after Piwowar’s announcement, an ideologically reliable Senate staffer named Elad Roisman was identified, recommended to Trump, and nominated. Only seven weeks later, Roisman had a confirmation hearing. Four weeks later Roisman was sent by the Banking Committee to the full Senate. And by September 4, 2018, Roisman had been confirmed—less than four months after Piwowar’s sudden departure was announced.
Schumer, who had known since 2017 that Stein could not serve past the end of 2018, did not move nearly as quickly. He did not recommend a potential nominee to Trump until the end of July 2018. Since Roisman’s Banking Committee hearing had already occurred, Schumer’s pick (Allison Lee) could not be paired with Roisman. Ultumately, Lee was not confirmed unil June 20, 2019—nearly a year after Roisman joined the SEC and nearly six months after Kara Stein’s last day of service.
That a Democratic seat at the SEC was empty for half a year was not just a matter of theoretical concern. Before Roisman’s confirmation, the less doctrinaire SEC Chairman Jay Clayton could formulate a working majority on enforcement with lone Democrat Rob Jackson against one outrageously pro-corporate Republican commissioner. Once Roisman took his seat, conservatives held two of the four commissioner slots and could block any vigorous action, so securities law violators faced much less significant penalties.
Don’t take our word on this—it is exactly what five excited partners at elite corporate law firm Debevoise & Plimpton wrote in Law 360. And it is not just Debevoise—prestigious Wachtell, Lipton, Rosen, & Katz just wrote a memo warning clients against ending compliance with the law simply because transgressions are rarely punished by Trump appointees. There is a need for as many bulwarks defending the importance of compliance as possible amidst the general decline from mediocre enforcement under Obama to nearly nonexistent enforcement under Trump.
Now, just as Allison Lee is seated, Robert Jackson’s term has expired, as Kara Stein’s had in 2017. Jackson cannot serve beyond 2020, and we hope he continues his strong performance until his successor is confirmed. But we also hope that Schumer acts expeditiously to accelerate the timeframe on which Jackson is replaced—ensuring that there is no gap and that his successor has a running start in front of whatever broader changes the agency undergoes after next year’s elections.
And yet, while Schumer has taken time from his busy schedule to issue numerous warnings about FaceApp, he has failed to act on the SEC selection, despite the fact that multiple well-qualified officials with serious records of public service commitment have made it known to his office that they are not only qualified for the SEC, they are eager to serve on it. We would hope that the lessons from the sloth in identifying Lee for Stein’s seat would be obvious.
Schumer has a spot to fill—a spot that wields great power. He has excellent candidates from which to choose. So, what, precisely, does he have to lose? Schumer should not waste another moment in sending a name to Trump. And if Trump refuses to move forward on a Democratic commissioner, Schumer needs to be willing to elevate public attention to McConnell and Trump’s stealth nuclear option and to urge the next Democratic president to consider a retaliatory nuclear strike of their own.