Politics
Obama to nominate Rep. Melvin Watt to head the Federal Housing Finance Agency
Watt, a senior member of the House Financial Services Committee and former chairman of the Congressional Black Caucus, played an influential role in the passage of a financial regulatory overhaul in 2010. That legislation, however, did not address the fate of the major mortgage lenders, an issue likely to come up during Obama’s second term.
Watt represents the Charlotte area, home base of behemoth Bank of America Corporation. He becomes yet another high-profile African-American and the second North Carolinian nominated by Obama in three days to a top government post. On Monday, Obama nominated Anthony Foxx, mayor of Charlotte, to head the Transportation Department.
Erskine Bowles, a fellow North Carolinian and former White House chief of staff under President Bill Clinton, praised Watts as a first-rate selection. Both men were classmates at the University of North Carolina at Chapel Hill. Bowles, who holds some sway with Republicans as the Democrat in a debt-tackling partnership with former Republican Sen. Alan Simpson of Wyoming, said Watts brings “a bright mind, great work habits and an understanding of how Washington works to the job.”
Hugh McColl, former Bank of America chairman and CEO, also welcomed Watt’s nomination. McColl says he has known Watt for four decades, first meeting him through his brother-in-law, former Rep. John Spratt, D-S.C., who attended Yale Law School at the same time as Watt.
“What he brings to everything, doesn’t matter the subject, is an open mind,” McColl said. “He has clarity of thought.”
Charlotte is a major banking center, and the top donors to Watt’s political campaigns over the years have been bank political action committees and bank officials and employees.
His nomination comes nearly a year after DeMarco, who has been acting director, stood by a decision to bar Fannie and Freddie from reducing principal for borrowers at risk of foreclosure, resisting pressure from the administration. DeMarco long has opposed allowing the mortgage giants to offer principal reduction.
In March, attorneys general from nine states, led by Democrats Eric Schneiderman of New York and Martha Coakley of Massachusetts, sent Obama a letter saying that under DeMarco, Fannie and Freddie have been a “direct impediment to our economic recovery.”
Copyright 2013 The Associated Press
