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THE GOLDEN APPLE: Your report on the latest discord from GrayRobinson

March 8, 2019

You gotta play hurt — We would appreciate it if personal icons would stop dying, please. Late last night we learned of the death of legendary sports reporter Dan Jenkins, possibly best known for his golf writing but most treasured by us for his 1991 book You Gotta Play Hurt, which the Los Angeles Times called “insufferable” and Kirkus Reviews called “bawdy, bitter, very funny, and as absolutely tasteless as its subject matter.” Ah, literature. You could do worse if you’re looking for something to read this weekend.
 
House Ways & Means is ready to tackle infrastructure — The House Committee on Ways and Means found bipartisan agreement at Tuesday’s hearing on “Our Nation’s Crumbling Infrastructure and the Need for Immediate Action.” The nation’s roads, bridges, waterways, pipelines and more all need repairs, upgrades, and replacements. Committee Chairman Richard Neal (D-MA) said he had spoken to Secretary of Transportation Elaine Chao and Secretary of the Treasury Steven Mnuchin about this, and sees a real opportunity for action. Ranking member Rep. Kevin Brady (R-TX) agreed, and said he was committed to working on a bill. The obvious question is how to pay for it. The Chairman and ranking member of the House Transportation Committee outlined the needs and said the obvious first step would be an increase in the federal gas tax, which hasn’t risen since 1993. Both Chairman Peter DeFazio (D-OR) and ranking member Rep. Sam Graves (R-MO) said that a vehicle miles traveled (VMT) fee was an attractive option, but needed more study and would have to be a long-term solution. The presidents of the AFL-CIO and US Chamber of Commerce joined forces in calling for an increase in the gas tax, and representatives of the trucking industry and the American Society of Civil Engineers agreed on the need for immediate action.
 
“Prevention of harm” is the goal, Kraninger tells House Financial Services — Kathy Kraninger, Director of the Consumer Financial Protection Bureau, testified before the House Financial Services Committee for five hours on Thursday in a hearing that was partisan and occasionally contentious. Chairwoman Maxine Waters (D-CA) introduced her “Consumers First Act,” which she said was designed to roll back all changes made by Acting Director Mick Mulvaney, including restoring the Office of Fair Lending and Equal Opportunity and the Office of Students and Young Consumers. Kraninger told the panel she believed the Bureau’s fair lending activities had been strengthened by moving the function into the Office of the Director. She said that drawing up a new Memorandum of Understanding with the Department of Education would be a priority, and that the Bureau would need additional legislative authority before it could supervise or enforce compliance with the Military Lending Act. As her three-month listening tour comes to an end, Kraninger told the Committee she was still considering how best to measure the Bureau’s success, but she believed it would consist of preventing harm to consumers. She also said that her mind remained open about the proposed rollback of the small-dollar loan rule, but she wanted to make sure they were not limiting consumers’ access to credit.
 
Equifax “neglected cybersecurity” for years, says Senate report — The Senate Permanent Subcommittee on Intelligence issued a scathing bipartisan report on the Equifax data breach yesterday, and called Equifax CEO Mark Begor and Marriott CEO Arne Sorenson up to testify before the Committee on ways to prevent future data breaches. The report found that Equifax had “failed to follow basic cyber security protocols,” said Subcommittee Chairman Rob Portman (R-OH), waited six weeks to notify the public of the breach, and lost internal online chats about the discovery of the breach. Marriott disclosed a 2014 breach of its Starwood reservation database in November 2018, almost 12 weeks after it learned of the breach. At yesterday’s hearing, representatives of the GAO, the FTC’s Bureau of Consumer Protection, and the Center for Internet Security discussed recommendations for comprehensive privacy legislation.
 
House, Senate panels hear that the maritime industry needs the Jones Act — Hearings on the state of the maritime industry before the Senate Commerce Committee and the House Transportation Subcommittee on Coast Guard and Maritime Transportation painted different pictures of the health of the industry at hearings this week, but all the witnesses agreed: preserving the Jones Act is essential for the industry’s survival. The 100-year-old Jones Act requires that all vessels transporting goods from one US port to another be American-built, owned, crewed, and flagged, which witnesses said was important for both commerce and national security. The Senate hearing was more upbeat than the House hearing, focusing on the excellent jobs created by the maritime industry, while Rear Admiral (Ret.) Mark Buzby, Administrator of the Maritime Administration, expressed concern about low-cost foreign competitors driving US ships out of international markets. Personnel shortages in the industry are also a problem, and the President signed an executive order on Monday to make it easier for military personnel to transition to civilian maritime careers.
 
Confirmations, nominations, departures, etc. — FDIC General Counsel Charles Yi will leave that position at the end of March, he announced this week. Yi has held that position since January 2015; he previously served as staff director and chief counsel for the Senate Banking Committee; as deputy assistant secretary of the Treasury for banking and finance; and as counsel to the House Financial Services Committee.
 

Next Week in Washington:
 
March 12 — House Appropriations Subcommittee on Financial Services and General Government holds a hearing on “Treasury’s Role in Combatting Financial Crimes.” 2362-A Rayburn House Office Building, 10:00 a.m.
 
March 12 — House Budget Committee holds a hearing on the President’s 2020 Budget. 10:00 a.m., 210 Cannon House Office Building.
 
March 12 — House Energy and Commerce Committee holds a hearing on “Legislating to Safeguard the Free and Open Internet.” 10:00 a.m., 2322 Rayburn House Office Building.
 
March 12 — House Financial Services Committee holds a hearing entitled, “Holding Megabanks Accountable: An Examination of Wells Fargo's Pattern of Consumer Abuses.” 10:00 a.m., 2128 Rayburn House Office Building.
 
March 12 — House Transportation and Infrastructure Committee holds a hearing on “Looking Forward: Aviation 2050.” 10:00 a.m., HVC-210, Capitol Visitors Center.
 
March 12 — Senate Banking Committee holds a hearing on the Consumer Financial Protection Bureau’s Semi-Annual Report to Congress. 10:00 a.m., SD-538 Dirksen Senate Office Building.
 
March 12 — Senate Committee on Finance holds a hearing on “Approaching 25: The Road Ahead for the World Trade Organization.” 10:15 a.m., SD-215 Dirksen Senate Office Building.
 
March 12 — Senate Committee on Homeland Security & Governmental Affairs holds a hearing on “A Path to Sustainability: Recommendations from the President’s Task Force on the United States Postal Service.” 2:30 p.m., SD-342 Dirksen Senate Office Building.
 
March 13 — House Financial Services Committee holds a hearing entitled, “Preparing for the Storm: Reauthorization of the National Flood Insurance Program.” 10:00 a.m., 2128 Rayburn House Office Building.
 
March 13 — Senate Agriculture Committee holds a hearing on the nomination of Heath P. Tarbert to serve as Chairman and member of the Commodity Futures Trading Commission. 10:00 a.m., 328A Russell Senate Office Building.
 
March 13 — House Financial Services Subcommittee on National Security, International Development and Monetary Policy holds a hearing entitled, “Promoting Corporate Transparency: Examining Legislative Proposals to Detect and Deter Financial Crime.” 2:00 p.m., 2128 Rayburn House Office Building.
 
March 13 — Senate Budget Committee holds a hearing on the President’s budget request for 2020. 2:30 p.m., SD-608 Dirksen Senate Office Building.
 
March 13 — Senate Small Business Committee holds a hearing on “Cyber Crime: An Existential Threat to Small Business.” 2:30 p.m., SR-428A Russell Senate Office Building.
 
March 14 — House Ways and Means Committee hears testimony from US Treasury Secretary Steven Mnuchin on the President’s Fiscal Year 2020 Budget Proposal. 9:00 a.m., 1102 Longworth House Office Building.
 
March 14 — House Financial Services Subcommittee on Investor Protection, Entrepreneurship and Capital Markets holds a hearing entitled, “Putting Investors First? Examining the SEC’s Best Interest Rule.” 9:30 a.m., 2128 Rayburn House Office Building.
 
March 14 — Senate Banking Committee holds a hearing on the Financial Stability Oversight Council’s Nonbank Designations. 10:00 a.m., SD-538 Dirksen Senate Office Building.
 
March 14 — Senate Finance Committee holds a hearing on the President’s fiscal year 2020 budget for the Department of the Treasury. 1:30 p.m., SD-215 Dirksen Senate Office Building.
 

The Ellis Insight. Jim Ellis reports on political news: 
 
President
 
Stacey Abrams:  Reports from Georgia suggest that defeated gubernatorial candidate Stacey Abrams (D), who said she would decide about challenging Sen. David Perdue (R) by the end of this month, may now be on a different timetable that may extend well into April. In addition to determining if she might launch a Senate race or return in 2022 to challenge Gov. Brian Kemp (R), she also is contemplating whether to enter the presidential campaign. 
 
Michael Bloomberg:  Despite public comments that he would spend $500 million of his own money on a presidential campaign, hiring key political staff, designing a presidential logo, and planning an announcement tour beginning in his birth city of Boston, former New York City Mayor Michael Bloomberg announced that he will not run for president in 2020. While saying he believes he would match up well against President Trump in the general election, he doesn’t see a path to claim the Democratic nomination. 
 
Sen. Sherrod Brown:  Ohio Senator Sherrod Brown, who many believed was also preparing to enter the Democratic presidential nomination field, said yesterday that he will not. Citing a reason similar to that Michael Bloomberg articulated, Sen. Brown basically indicated that he did not see a victory path, meaning that he would be unable to attract many of the supporters he needs because of other similar candidates fighting over the same voter pool.
 
Gov. Jay Inslee:  As expected, Washington Gov. Jay Inslee became the twelfth official Democratic presidential candidate with decisions pending from former Vice President Joe Biden and ex-Rep. Beto O’Rourke (D-TX), but declined to rule out seeking a third term in his present position. 

Because the Washington candidate filing deadline is not until May of 2020, Mr. Inslee can stay in the race through the critical March 17th primary election day when 65% of the first ballot delegate votes will be committed. If not a factor headed toward the national convention at that time, he will easily have time to revert back into another race for Washington Governor.
 
Senate
 
Colorado:  Rep. Ed Perlmutter (D-Arvada), who entered the 2018 Governor’s race only to withdraw after two months and return to his safe House seat, said yesterday that he is not thinking about entering the 2020 Senate campaign and that, “he likes the House.” 
 
Democrats are in search of a stronger potential opponent to Sen. Cory Gardner (R) than the ones who have already announced: former state Senator and defeated gubernatorial candidate Mike Johnston, and ex-state House Speaker and twice defeated federal candidate Andrew Romanoff. The seat looks to be highly competitive since Colorado is moving distinctively toward the political left. But, it will likely take a stronger candidate than Messrs. Johnston or Romanoff to unseat Sen. Gardner, one of the GOP’s most talented candidates.
 
Kansas:  Dave Lindstrom, a retired Defensive End for the Kansas City Chiefs NFL Club (1978-85), is considering entering the open US Senate Republican primary. Currently, Mr. Lindstrom is the chairman of the Kansas Turnpike Authority and serves as a member of the Johnson County Community College Board. Johnson County, home of Kansas City, KS, is the state’s largest county by far, home to over 559,000 people. Sen. Pat Roberts (R) has already announced that he will not seek a fifth term in office.
 
North Carolina:  It has been no secret that the Democratic leadership has tagged state Attorney General Josh Stein as their top choice to challenge first-term Sen. Thom Tillis (R-NC). Yesterday, it was reported that the first-term AG is planning to eschew a Senate race, however, in order to run for re-election to his current post.
 
At this point, the Democrats have not fielded a Senate candidate with statewide name recognition. So far, state Sen. Erica Smith (D-Gaston) and Mecklenburg County Commissioner Trevor Fuller are the only announced Senate candidates. Since both are regional officials, each will first be tasked with becoming known on a statewide basis in order to position themselves as Mr. Tillis’ top challenger.
 
Oregon:  Late this week, two-term Sen. Jeff Merkley (D) announced that he will seek re-election next year. His declaration also means that he will not be a presidential candidate, which he acknowledged, because the Oregon political leadership would not adhere to his request to change election law so individuals could simultaneously seek more than one office. Sen. Merkley is a prohibitive favorite for re-election. 
 
Texas:  Rep. Joaquin Castro (D-San Antonio), the subject of much discussion about whether he will challenge Sen. John Cornyn (R-TX) next year, took an unusual step during the week.  The Congressman released a statement saying that he is “seriously considering a Senate 2020 campaign.” 
 
While former state Senator and 2014 gubernatorial nominee Wendy Davis (D) said she would yield to Rep. Castro if he chooses to oppose Sen. Cornyn, she would consider running for the Senate if the Congressman decides to remain in the House. The emergence of ex-Senator Davis would likely be a welcome sight for Sen. Cornyn and the Republicans. Against then-Attorney General Greg Abbott (R), Ms. Davis fared poorly, losing 59-39%.
 
House
 
CA-21:  Former Rep. David Valadao (R-Hanford/Bakersfield) lost a close re-election battle to businessman T.J. Cox (D-Fresno) in November, but recent developments suggest no rematch is likely at least in 2020. This week, Mr. Valadao and his wife filed for bankruptcy citing multi-million-dollar agribusiness losses. 
 
The 21st District is heavily Democratic, and Mr. Valadao had done well to hold the seat for three terms until what certainly proved to be a wave election in California swept him out of office. It is unlikely another Republican could do better in the future, so Rep. Cox may find himself in good shape for re-election.
 
CA-48:  Former state Assemblyman and Orange County Republican chairman Scott Baugh (R) announced this week that he will not challenge freshman Rep. Harley Rouda (D-Laguna Beach) even though he filed a fundraising committee with the FEC earlier in the year. Mr. Baugh, who finished a strong fourth in the 2018 jungle primary, was viewed as one of the Republicans’ strongest potential candidates for 2020. Mr. Rouda defeated 15-term Rep. Dana Rohrabacher (R-Costa Mesa), 54-46%, in the November election.
 
CA-49:  Freshman Mike Levin (D-San Juan Capistrano) proved to be an easy winner in November, converting this southern California Republican congressional district to the Democratic column. With incumbent Rep. Darrell Issa (R-Vista) not in the field, Levin cruised to a November victory over Board of Equalization member Diane Harkey, 56-44%. 
 
Late this week, one of the 16 candidates who ran for the open seat last year says he will run again in 2020. San Juan Capistrano Mayor Brian Maryott (R), who finished in the middle of the pack in 8th place, captured only 3% of the jungle primary vote. He will have to perform considerably better next year if he is to have a chance at unseating Rep. Levin.  At least in the early going, the new Congressman appears to be a lock to secure a second term.
 
NC-9:  We now know that North Carolina’s 9th Congressional District will remain vacant for exactly one year. On November 6th, Republican Mark Harris, the top vote getter in the 2018 general election, was not certified the winner because of voter fraud accusations in one particular county. On Monday, the NC State Board of Elections, after last week ordering a brand new vote, released the special election schedule.
 
The candidate filing deadline will be March 15th for the special primary now scheduled for May 14th. If a run-off is required – meaning no candidate received 30% of the party primary vote – such election will be conducted on September 10th. The special general election will occur November 5th. 

If no party requires a run-off, the general will move to September 10th. But, considering that Mr. Harris won’t run and the GOP side is wide open, it is highly likely that a run-off will occur. Democratic businessman Dan McCready, the ’18 Democratic nominee, is the prohibitive favorite to win the party nomination in the special election.
 
PA-12:  Republican delegates to the special district convention chose a party nominee for the May 21st special election to replace resigned Rep. Tom Marino (R-Williamsport) in a marathon seven-hour session last Saturday.
 
With 14 candidates entered into the nomination process, the delegates voted four times before a winner emerged with majority support. State Rep. Fred Keller (R-Mifflinburg) is the new party nominee defeating fellow state Rep. Jeff Wheeland (R-Williamsport) and the dozen others. He becomes the heavy favorite to succeed Rep. Marino in a central Pennsylvania district that voted 66-30% for President Trump. Mr. Keller will now face Democratic nominee Marc Friedenberg, a college professor who lost to Rep. Marino in November, 66-34%. 
 
TX-23:  Though 2018 Democratic nominee Gina Ortiz Jones has yet to confirm that she will again run for Congress, all signs are pointing to a re-match between she and three-term Rep. Will Hurd (R-San Antonio). In November, Ms. Jones lost to Congressman Hurd by just 926 votes.
 
While Ms. Jones has yet to declare her candidacy, Democratic Congressional Campaign Committee chair Cheri Bustos, who represents a district in Western Illinois, is telling Texas news reporters that there will be a re-match in 2020. We can expect another tight race from this highly volatile Lone Star State district. 
 
Governor
 
Louisiana:  Though House Minority Whip Steve Scalise (R-Slidell) has several times indicated he is not planning to run for Governor this year, political speculation continues that he may well reverse course and enter the jungle primary against incumbent Gov. John Bel Edwards (D). During the week the situation clarified as Mr. Scalise again reiterated that he is “not running for Governor.” 
 
Many Louisiana Republican leaders reportedly feel the party needs a stronger candidate than the two announced entries, Rep. Ralph Abraham (R-Alto/Monroe) and developer Eddie Rispone. GOP strategists are unhappy, for example, that Rep. Abernathy reported raising less than $400,000 before the end of last year. 
 
Mississippi:  At the beginning of this week Mississippi election officials released the candidate list for the 2019 state elections, thus the field for the August 6th party primaries are now set. If no candidate receives majority support in the first election, the top two finishers will run-off on August 27th. The general election is November 5th. 
 
In the Republican gubernatorial primary, to replace term-limited incumbent Phil Bryant (R), three candidates filed as expected. Lt. Gov. Tate Reeves, who Gov. Bryant has endorsed, retired state Supreme Court Justice Bill Waller Jr., and state Rep. Robert Foster (R-Hernando) are now the official contenders. 
 
For the Democrats, nine individuals filed paperwork to run. The prohibitive favorite for the gubernatorial nomination is four-term Attorney General Jim Hood. The other candidates of significance are Hinds County District Attorney Robert Shuler Smith, and former Natchez Mayor and ex-state Representative Phillip West. 
 
The large number of minor candidates suggest there is an outside possibility that Hood is forced to a run-off, but at this point he must be considered a clear favorite to win outright. Most observers believe that AG Hood gives the Democrats a legitimate chance to capture the Governor’s mansion for the first time since Ronnie Musgrove last won in 1999.
 

 
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