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October 13, 2022
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PRESENTED BY
THE TOP
Happy Thursday morning. There are 26 days until Election Day.
Over the next few weeks, we’re going to dig into the race for House majority whip. We’re not saying Republicans will win the House next month. But we do believe it’s worth exploring the various dynamics that will play out should Republicans take the five seats they need for control of the chamber.
Today we’re going to begin with Rep. Jim Banks (R-Ind.). Banks, 43, is the chair of the Republican Study Committee, once a power center in the House GOP. Banks has used this perch to bring in bold-faced names such as former Vice President Mike Pence and former Secretary of State Mike Pompeo to talk to the group. In fact, most potential Republican presidential candidates have been in front of the RSC this Congress, courtesy of Banks.
But as we all know, Banks is in a three-way race for majority whip against NRCC Chair Tom Emmer of Minnesota and Rep. Drew Ferguson of Georgia, currently the chief deputy whip.
Inside the House Republican Conference, Minority Leader Kevin McCarthy and Minority Whip Steve Scalise are set to be speaker and majority leader in a GOP-run chamber. Rep. Elise Stefanik of New York is the overwhelming favorite to remain as Conference chair. That leaves the majority whip post – the No. 3 spot – as the biggest prize up for grabs if Republicans win.
So we’ll start with our first SWOT (strengths, weaknesses, opportunities and threats) analysis of the majority whip race on Banks. We’ll follow up soon with the same for Emmer and Ferguson.
Strengths
Banks’ argument is that he’s the real conservative in the race. And although they may not say it publicly, Republicans realize that they’re going to have to take tough votes if they win the majority – approving more money for the war in Ukraine, funding social programs, and worst of all, lifting the federal government’s debt limit. Banks’ supporters say that he’d be an important validator for those causes since he has credibility on the right. Banks is relatively savvy on policy and understands what conservatives want. Of course, this is an argument we’ve heard in the past, and it doesn’t always work as planned. But it’s important to keep this in mind as Banks seeks to climb the leadership ranks.
As we’ve noted, Banks chairs the RSC, which has given him a platform to be in front of a few dozen members every week. If you talk to those involved with the right-leaning caucus, they say Banks has made it interesting and useful again. The RSC, however, is too large to be a monolith in a race like this. So while Banks will pull support from this group, so will the other two candidates.
Banks also has a strong relationship with former President Donald Trump and his orbit. The GOP is quite obviously dominated by Trump. Although he may not endorse, Banks’ relationship with Trump world could be a factor for GOP lawmakers. Banks also is a frequent presence on Fox News’ primetime programming, which is important to Republicans as they seek to move into the majority.
This GOP leadership team will be light on Midwesterners, so to the extent Banks can pull from that geographical region, that will be helpful for him. Emmer can play this up too. Banks’ working hypothesis is that he will need 120 votes to win. Probably a tad aggressive, but it’s better to be safe than sorry.
Weaknesses
Banks is relatively untested. In just his third term, Banks hasn’t been a top whip while Ferguson has, albeit in the minority. (Ferguson, also in his third term, isn’t in McCarthy’s daily management meeting, so his direct exposure to leadership interactions is somewhat limited.)
Some may take umbrage over Banks’ close relationship with Trump, but that’s a very small minority of Republicans at this point.
Banks isn’t a fundraising powerhouse, and he trails both Emmer and Ferguson significantly in this category. Banks travels to raise money and support candidates, but not nearly as much as Emmer, who’s on the road frequently and speaks with candidates on the phone weekly, if not daily.
And then there’s the overarching question of what Banks adds to the leadership equation. What new dynamic or skill does Banks bring to the table? Banks’ supporters would argue that he bolsters McCarthy’s conservative flank. But his detractors may make the argument that Banks doesn’t provide much value add.
Opportunities
When you view Banks’ chances versus Emmer and Ferguson, the Indiana Republican has been more aggressive. Emmer has asked lawmakers to keep their powder dry, although he quietly has allies doing his whipping. Ferguson has been in the race the longest, yet he has still drawn competition.
A race like this is unlikely to be decided on the first ballot. So here’s how Banks world thinks about a head-to-head race with either Ferguson and Emmer. Much of the conference understands that McCarthy isn’t very taken with Ferguson. And there’s a small clutch of social conservatives who have chafed at Emmer’s vote to codify same-sex marriage into law.
Threats
There’s a big threat here to Banks and it’s this – if the GOP has a big night on Nov. 8, the entire whip race can swing Emmer’s way. Emmer is the NRCC chair, and if Republicans win the majority, it will be tough to deny him a promotion. Especially since Emmer won seats in 2020 as well.
– Jake Sherman
INSURRECTION INVESTIGATION
Another big hearing for the Jan. 6 panel. Then what?
As the Jan. 6 select committee holds what may be its final public hearing today, it’s worth looking back for a moment at where the panel has been and how it’s changed congressional investigations – both good and bad.
Like the Jan. 6 insurrection itself, what the select committee has done is unprecedented. The panel engaged in an extraordinary legal, political and PR battle with former President Donald Trump, and it’s largely won. The committee has portrayed Trump and his allies as an ongoing threat to democracy, something the former president will have to deal with if he runs again in 2024. And it’s spurred the Justice Department to investigate many of the same allegations the panel uncovered.
A federal judge ruled that Trump and his allies likely committed criminal acts in seeking to overturn the 2020 elections, a stunning statement in itself. More than 2,300 texts from former White House Chief of Staff Mark Meadows were obtained – and then leaked – giving the panel a priceless window into what was happening in Trump’s inner circle and beyond. Committee investigators interviewed 1,000-plus witnesses and combed through millions of pages of documents, a herculean effort that’s produced numerous revelations. There are bound to be even more in the committee’s final report.
Through the skilled use of video, witness testimony and member questioning, the panel deliberately presented a TV-show quality production instead of the standard-fare congressional hearing. They wanted good TV and they got it. There were also some riveting moments, including former Trump aide Cassidy Hutchinson’s blockbuster revelations about a furious president throwing dishes against the wall in the White House and fighting with Secret Service agents who blocked him from traveling to the Capitol on Jan. 6.
Yet some of the very attributes that went into making the panel successful have been used by Trump and the Republicans to undermine it. Speaker Nancy Pelosi rejected several of House Minority Leader Kevin McCarthy’s picks for the select committee, which Republicans viewed as a shocking breach of tradition. McCarthy then withdrew all of his lawmakers from the panel. Pelosi responded by appointing two Republicans on her own. This gave Democrats a free hand during the investigation. But it also set a precedent that Republicans will emulate if they take the majority.
The select committee subpoenaed McCarthy and four other Republicans over their dealings with Trump up to and on Jan. 6, another surprising and unprecedented tactic. The Republicans refused to cooperate, setting two new precedents in the process. The House can subpoena its own members now as part of (non-ethics) investigations, and those members can blow off the subpoenas.
In today’s hearing, the select committee will offer an overview on all that went on before and after the insurrection, including Trump’s “state of mind,” according to committee aides.
While the panel will present new documentary and witness evidence, there won’t be any live testimony. Instead, the select committee will lay out the entire timeline surrounding the deadly attack on the Capitol.
A committee aide offered this preview:
Reps. Bennie Thompson (D-Miss.) and Liz Cheney (R-Wyo.), the chair and vice chair, will open the hearing, but the other seven members of the panel will present different elements of the narrative as well, aides noted. The hearing is expected to last roughly two-and-a-half hours.
In addition, the select committee has obtained hundreds of thousands of pages of internal documents from the Secret Service via subpoena that it plans to use for both today’s session and its final report.
– John Bresnahan
DEMOCRAT DISSENTS
Hickenlooper: Crypto rules needed, not just penalties
News: Sen. John Hickenlooper (D-Colo.) sent a warning letter to Gary Gensler, chair of the Securities and Exchange Commission, on Wednesday night. The message — it’s time for the agency to write rules for crypto securities in “a transparent notice-and-comment regulatory process,” Hickenlooper said.
Hickenlooper’s letter marks the first time a Senate Democrat has publicly offered any concern around the SEC and what’s sometimes called “regulation by enforcement.” That’s where an agency responds to a novel legal question through enforcement penalties. However, this approach lacks the public deliberation and comment process of a typical rulemaking.
“I recognize these questions are complicated,” Hickenlooper wrote. “But it is time for the SEC to engage.”
Here’s a key excerpt from Hickenlooper’s letter to Gensler:
Hickenlooper went on to suggest that the SEC could offer guidance on the rules surrounding initial coin offerings, digital security disclosures, as well as those governing trade and custody arrangements, among other topics.
The letter could be a bad omen for Gensler, suggesting his approach to digital assets is losing some support on the Hill. Furthermore, if Republicans win either chamber, the SEC will come under a microscope on Capitol Hill.
Since 2021, key Republicans – including the Senate Banking Committee’s Ranking Member Pat Toomey (Pa.) and House Financial Services Committee Ranking Member Patrick McHenry (N.C.) – have accused Gensler of crafting the SEC’s approach to digital asset policy haphazardly through enforcement actions. This has led to crypto firms getting penalized for breaking securities laws after the fact.
Here’s the deal: The SEC has published no crypto rules but it has imposed plenty of crypto penalties over the last year or so, including – quite notably – a $1.26 million settlement with Kim Kardashian last week. The billionaire failed to disclose she’d been paid to promote a crypto product in 2021.
At the same time, there’s no federal law on the books today that defines digital assets, let alone distinguishes when crypto should be supervised by a commodities regulator versus a securities one. That leaves Gensler in a tight spot.
The SEC did not provide a comment before publication time.
– Brendan Pedersen
PRESENTED BY DUKE ENERGY
As Duke Energy transitions to more affordable, reliable and cleaner energy, we’re investing in the workforce for the new energy landscape. Visit duke-energy.com/SmartInvestments.
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THE CAMPAIGN
| → | When you’re a Democratic candidate running in a district former President Donald Trump won, you’ve got to be creative in your ads. A new spot from Rep. Matt Cartwright (D-Pa.) takes this to heart. |
The ad features two men sitting on a bench. One man wears a “Make America Great Again” hat, the other wears a Biden 2020 shirt. The Trump supporter praises Cartwright for funding the police and for sticking up for the working class, while the Joe Biden voter thanks Cartwright for capping drug prices.
“So we agree on one thing,” the Trump supporter says. “One thing,” the Biden voter replies.
“Matt Cartwright!” they both say before Cartwright joins them on the bench.
| → | We have another new ad for you in the competitive race for New Jersey’s 7th District. Rep. Tom Malinowski (D-N.J.), who’s running against Republican Tom Kean Jr., is labeling Kean as “anti-choice” and “pro-Trump.” The spot says Kean supports a national abortion ban that would supercede New Jersey law. It’s yet another example of vulnerable Democrats focusing on abortion rights in their reelection messaging. |
| → | Ever wonder how House Minority Leader Kevin McCarthy is playing in swing districts? Rep. Abigail Spanberger’s (D-Va.) campaign has a new digital ad out slamming GOP opponent Yesli Vega for going back on her vow to vote against McCarthy for speaker. |
| → | Rep. Melanie Stansbury (D-N.M.) is also featuring abortion rights in a new ad, hitting her opponent Michelle Garcia Holmes for vowing to “fight against abortion.” |
| → | Democrat Wes Moore’s campaign for governor of Maryland has a new cable and broadcast ad out that highlights his military service in Afghanistan. The Maryland gubernatorial election is one of the top races House Majority Leader Steny Hoyer is tracking this cycle. Hoyer backed Moore in the primary. |
| → | The retiring Sen. Richard Shelby (R-Ala.) still has $9.5 million in his campaign account, according to a campaign finance report released Wednesday. |
| → | HUD Secretary Marcia Fudge gave $50,000 from her campaign account to the Ohio Democratic Party on Aug. 19. |
| → | Sen. Lisa Murkowski’s (R-Alaska) leadership PAC shipped $67,000 to the Senate Leadership Fund on Sept. 21. |
— Max Cohen and Jake Sherman
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Presented by Apollo Global Management
Learn how Apollo is rethinking retirement income to last the modern lifespan. Think It New.