In May, president Obama nominated U.S. Rep. Melvin L. Watt, a Charlotte, N.C., Democrat, to head the Federal Housing Finance Agency (FHFA). The nomination has been in limbo ever since, and now it may be delayed further.
Watt has faced tough Republican opposition, with GOP senators contending he lacks the technical expertise for the job overseeing housing giants Fannie Mae and Freddie Mac. A prior White House nomination, Joseph A. Smith, a North Carolina banking commissioner, failed to win support in the Senate. Representative Watt is opposed by Republicans largely because he supports principal reduction for distressed homeowners.
Sen. Lindsay Graham, a South Carolina Republican, said that he plans to hold up all Senate appointments until the administration answers more questions about the Benghazi attack in September 2012.
The FHFA is the taxpayer-owned regulator which oversees mortgage giants Fannie Mae and Freddie Mac. A vote is scheduled later this week. After Senate leaders failed to get him confirmed before the annual summer recess, news reports suggest that some Capitol Hill Democrats are worried about the nomination. Watt needs 60 votes to be confirmed. North Carolina’s Richard Burr is the only Republican senator to so far come out in support of Watt publicly.
Watt is a lawyer who has represented North Carolina in Congress for the last two decades. If he is confirmed, he would become a powerful economic policy maker, as the housing market recovers and the federal government contemplates the future role of Fannie and Freddie.
The FHFA has been without a confirmed director since James Lockhart left the post in August 2009. Edward DeMarco, Lockhart’s deputy, took over as acting director and has overseen Fannie and Freddie as they returned to profitability last year. DeMarco has been acting director of the FHFA for more than three years.
Should Watt fail to win Senate confirmation, the White House could name him as a recess appointment.
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