Skip to content
Sign up to receive our free weekday morning edition, and you'll never miss a scoop.
Rep. Patrick McHenry (R-NC) watches as newly elected U.S. Speaker of the House Mike Johnson

What Speaker Johnson means for financial policy

Plenty of senators have been googling “Mike Johnson” since he ascended to the speaker’s office this week. Bank lobbyists have been doing the same.

The 51-year-old Republican from Louisiana is a mystery to the financial world’s most influential advocates. More than one lobbyist we asked described Johnson as a “black box.”

“General sentiment in our world is that he is a totally unknown figure,” one official working for a top bank trade group said.

That being said, Johnson’s no stranger to their campaign contributions. The American Bankers Association, for instance, has donated to Johnson’s congressional campaigns since his first run in 2016 and in every election since.

Some lobbyists told us the real story of Johnson’s speakership is less about his new job than the position that Rep. Patrick McHenry (R-N.C.) no longer has. Being speaker pro tem for the past three weeks took McHenry away from the House Financial Services Committee, where he serves as chair.

Wall Street was excited at the prospect that McHenry could be elected speaker pro tem into January or beyond. But bankers will certainly be happy to have him back on the committee as well.

Speaking to reporters Thursday, McHenry made it clear he was excited to get back to the Financial Services panel. “I’ve got a stack of policies that I want to get into end-of-year packages,” the North Carolina Republican said.

But let’s be clear: Johnson does have preferences that could ripple through banking policy.

The most obvious example is cannabis banking. Johnson voted against the SAFE Banking Act in 2019 when it passed the House for the first time. Former Speaker Kevin McCarthy was one of nearly a hundred Republicans who voted for it, which made advocates bullish about eventually getting a vote on the floor. Johnson’s ascendance seems to make that outcome less likely.

Then there’s flood insurance. The National Flood Insurance Program is a $20-billion fiscal mess that Congress has put off fixing for decades. Few states have as much of an interest in the NFIP as Johnson’s home base, the flood-prone state of Louisiana.

However, an interest in flood insurance from the speaker of the House doesn’t necessarily mean the policy is any more likely to get reformed. In fact, it might mean the opposite. Coastal state lawmakers like Majority Leader Steve Scalise have resisted efforts to raise homeowners’ flood insurance rates for years.

— Brendan Pedersen and John Bresnahan

Presented by The Coalition to Project American Jobs

It’s taking the IRS years to process a small business tax credit. 1M+ small business owners who filed for the Employee Retention Credit are stuck in backlog or waiting on payment for their claims. Tell the IRS to lift the moratorium now.

Editorial photos provided by Getty Images. Political ads courtesy of AdImpact.