Weekly update from the National Housing Conference

Dear Friend,

As Washington, D.C. and the rest of the country begin to recover from the longest shutdown of most non-defense functions of the U.S. government, I’d like to share a few reflections with our members; a caution about the future of shutdown politics, and then move on to real policy making rather than manufactured crises. First and foremost, this shutdown will define the speakership of Nancy Pelosi and her future dealings with President Trump. Regardless of one’s political outlook, we are all served by the checks and balances that are the foundation of our Constitution. Speaker Pelosi gave us all a master class in political brinksmanship, negotiation and message discipline as well as a national civics lesson in the power of a co-equal branch of government and the office of the Speaker.

As I have said in past member notes and public comments, government shutdowns are bad for everyone and should never be a part of politics. Having said that, we can’t rule out that the president won’t choose to shut down the government again. NHC will be prepared to help our members, the people we all serve and federal workers navigate whatever comes in our mission to defend the American Home. Legislation to prevent future shutdowns has been proposed by Sen. Rob Portman (R-Ohio) and Sen. Mark Warner (D-Va.) in the Senate. Portman’s S. 104 would create an automatic continuing resolution to keep the government funded if appropriations bills are not completed on time. If no resolution is reached after the first 120 days, funding would decrease by 1 percent and would subsequently decrease by that amount every 90 days. Warner’s bill, S. 198, would automatically renew government funding except for the legislative branch and the Executive Office of the President, who would not be paid. In the House, similar legislation has been proposed by Reps. Brendan Boyle (D-Pa.) (H.R.696), Troy Balderson (R-Ohio) (H.R.791), Glenn Grothman (R-Wis.) and Dave Loebsack (D-Iowa) (H.R.797).

Returning to regular order, the Trump administration is widely reported to be close to launching its plan to reform the housing government sponsored enterprises, Fannie Mae and Freddie Mac. Last Thursday, Politico reported on the White House’s plan to announce a major overhaul of the housing finance system. The overhaul would end government control of Fannie and Freddie through administrative action rather than statutory reform, as efforts to do so in Congress have been stalled for over 10 years. In a recording obtained by Politico from a Jan. 17 staff meeting, acting FHFA Director Joseph Otting remarked, “In the next two to four weeks you’re going to be able to see some communication that comes out of the White House and Treasury that really sets a direction for what the future of housing will be in the U.S. and what the FHFA’s part of that will be.” On Friday, House Financial Services Committee Chairwoman Maxine Waters and Senate Banking Committee Ranking Member Sherrod Brown wrote a letter to Otting calling on him to explain the remarks. On Tuesday, the Wall Street Journal reported the White House is “playing down the idea the administration will seek to unilaterally release the firms from government control,” even though they expect to announce a framework for housing finance changes “shortly.” This is in line with my belief that the Trump administration will seek to leverage congressional action by slowly rolling out administrative changes. While conservatorship and some reforms can be accomplished administratively, legislation is required to address the most fundamental unresolved flaws in the housing finance system including paying for a government guarantee and preventing race to the bottom competition between Fannie Mae and Freddie Mac, which led to their conservatorship in the first place. I addressed these issues in two HousingWire articles on July 17, 2018 and July 24, 2018. NHC is convening a Housing Finance Reform Working Group in February and invite all interested members to join by contacting Tristan Bréaux at [email protected].

One final note, NHC’s membership drive is under way. We are grateful to all of you who have already renewed and ask the remainder to send your dues in as soon as possible. Second invoices will be sent out shortly. It is going to be a big year at NHC, and we look forward to working with you on issues that are critical to your work – and ours!

  

Sincerely,

David M. Dworkin

President and CEO

National Housing Conference