Editorial: Watt faces uphill battle on Hill
North Carolinians who previously were oblivious to the Federal Housing Finance Agency are going to learn a lot more about the agency and its pivotal role in housing policy over the coming weeks, thanks to Rep. Mel Watt.
President Barack Obama on Wednesday nominated the longtime Democratic congressman from North Carolina to be director of the FHFA, which oversees federal mortgage giants Fannie Mae and Freddie Mac, the bailed-out lenders that hold or back roughly half of all U.S. home loans. The nomination immediately spurred speculation about potential candidates who might seek to replace Watt in the 12th District, the narrow, twisting district that stretches from Charlotte to Greensboro and includes portions of Rowan County. The district has re-elected Watt 10 times and in the 2012 presidential race gave Obama 79 percent of its vote.
But any prospective contenders for the seat probably don’t need to rush to assemble a campaign committee or start kissing babies. Veteran political observers believe Watt’s confirmation hearings in the Senate will, predictably, bring on a no-holds-barred battle from Republicans. The multibillion-dollar bailout of Fannie and Freddie was a flashpoint for GOP criticism of government intervention in the housing market. Republican leaders also favor the current acting director, Edward J. DeMarco, who has refused to allow Fannie Mae and Freddie Mac to forgive distressed borrowers’ housing debts. The president and many Democratic leaders want the two lenders to be more flexible in working with distressed homeowners to help them avoid foreclosure. Watt’s confirmation hearings will be a fight over two different visions for the role these agencies should play in economic as well as social policy.
Watt brings a solid resume to the table, one that fits well with the administration’s approach on housing policy and will find support from consumer advocates. During his two decades in Congress, the Yale-educated lawyer has served on the House’s financial services committee and has championed access to home loans for low-income borrowers, while also trying to stamp out predatory lending practices.
Watt has been an ally for lower-income constituents trying to find affordable housing or stave off foreclosure during the economic downturn, as well as being a vigorous advocate for other consumer-protection causes. His challenge now, however, will be to convince doubtful GOP senators that policies that have helped distressed homeowners while preserving Fannie and Freddie are also in the nation’s best longterm economic interests.