Will Trump Replace McWatters?

With the pandemic crisis taking up so much time and energy, it is understandable that people may forget about the everyday nuts and bolts of government.

Consider, for example, the NCUA board. The term of board member J. Mark McWatters expired in August. Sources in the credit union community said they have not heard any discussion of replacing him.

“It’s been very quiet on that front since last summer,” one source in the credit union community said.

The need to find a replacement for the Republican McWatters is not urgent, since he has said he will serve until a replacement is found. There is no huge rush, as long as Republicans are willing to gamble that President Trump will be reelected.

“Those in the administration who feel confident in the president’s reelection have no problem with McWatters remaining on the board for the remainder of the year,” said another source in the credit union community.

But if Trump is not reelected, Republicans risk losing the majority on the NCUA board.

Here are the possible scenarios:

  • Trump nominates someone before the election or during a lame duck session after Election Day and that person is confirmed by the Senate. Republicans would retain control of the NCUA board even if a Democrat is elected president since NCUA board members serve six-year terms.
  • Trump does not nominate someone or a person is not confirmed before the end of the year and Trump loses the election. This is the worst case scenario for the Republicans. It would allow the new Democratic president to nominate a member of his own party to replace McWatters. In that case, Democrats would control the agency board.

The Senate calendar remains in flux. Congress is certain to be dealing with the coronavirus crisis for the next several months. On the other hand, the Senate Banking Committee held confirmation hearings this week, so there may be a willingness to move some nominations.

Still, it will take time for the administration and the Senate to fully vet any nominee and it is an election year, when the congressional calendar is shorter so members can return home to campaign.

One source said there are good reasons to keep McWatters on the board for as long as possible. McWatters served as counsel to former Rep. Jeb Hensarling (R-Texas) on the congressional oversight panel for the Troubled Asset Relief Program. As a result, he has experience overseeing a financial recovery–an invaluable experience as the U.S. deals with the pandemic crisis.

“Bottom line, NCUA is low on the spectrum of changes anytime soon,” one source said.

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