D.C. Download: Bank failures, tranquilizers, TikTok, and crime

1 April 2023

It’s been a busy week at the Capitol, with federal lawmakers examining what caused Silicon Valley Bank to fail and whether TikTok is a big enough national security risk to warrant banning the app. Meanwhile, Sen. Catherine Cortez Masto (D-NV) introduced a bill to crack down on a dangerous tranquilizer that’s drawn the attention of leadership, and Rep. Steven Horsford (D-NV) is ensuring House Democrats and the White House are aligned over the latest Republican effort to rewrite local laws in Washington, D.C.

Cortez Masto investigates bank failures

Cortez Masto questioned top financial regulators this week about the collapse of Silicon Valley and Signature banks, revealing her concerns about the state of financial regulation and joining calls to penalize bank executives.

Cortez Masto used her seat on the Senate Finance Committee to question whether the Federal Reserve is capable of engaging in an unbiased analysis of its own behavior in regards to regulating mid-sized banks like SVB — a position echoed by Democrats such as Rep. Maxine Waters (D-CA), the ranking member on the House Financial Services Committee — and that will likely lead to congressional investigations. 

While she took a wait-and-see approach to diagnosing what caused the banks’ failure, Cortez Masto gave a nod to critics of the 2018 law that rolled back some of the regulatory rules from the 2010 Dodd-Frank law on small and medium-size banks, which progressives, including Sens. Bernie Sanders (I-VT) and Elizabeth Warren (D-MA), have said contributed to the bank failures. 

“If you find that that change in the law impacted the Fed’s ability to conduct the appropriate test based on the bank’s tiering of assets, would you be forthcoming with that and say so?” she asked Michael Barr, the Fed’s vice chair for supervision.

Cortez Masto joined 30 Senate Democrats in opposing the law, which President Donald Trump signed in 2018; several other moderate Democrats supported it.

But while she waited for more answers, she joined two of the Senate’s most populist members — Warren and Sen. Josh Hawley (R-MO) — to introduce legislation to claw back compensation from the bank executives. The Failed Bank Executives Clawback Act — which is supported by President Joe Biden and would ease any perceptions that the government bailed out the banks by making depositors whole — would empower the Federal Deposit Insurance Corporation to claw back compensation that the bank’s executives earned in the five years leading up to the collapse.

“It’s unacceptable for the executives at Silicon Valley Bank or any major financial institution to pay themselves millions in bonuses while running their banks into the ground,” Cortez Masto said in a statement. 

The legislation was also sponsored by Sen. Mike Braun (R-IN).

In addition, Cortez Masto signed multiple letters to officials, including one to the chairman of the Securities and Exchanges Commission, asking for an investigation into the stock trades SVB made in the months leading up to its collapse, another to the Comptroller General calling for a review of the supervisory practices of bank regulators, and one to Secretary of the Treasury Janet Yellen.

Taking on the banking sector has long been a part of Cortez Masto’s political history — as Nevada’s attorney general her office sued Bank of America in 2010 over deceptive mortgage practices.

Cortez Masto and Rosen break from party

A Wednesday Senate vote on a Biden water regulation presented the rare occasion in which both of Nevada’s senators broke with Democrats to vote down an administration priority.

The two joined Sens. Joe Manchin (D-WV), Jon Tester (D-MT) and Kyrsten Sinema (I-AZ) in voting with Republicans to overturn the Biden administration’s Waters of the United States rule, which had expanded the federal definition of what constitutes water and thereby what is protected by the environmental regulations in the Clean Water Act. 

That definition has taken different shapes under different administrations — it was expanded in 2015 by the Obama administration to include more streams and wetlands, and then weakened by the Trump administration in 2017, rolling back protections on certain wetlands and removing water-related various land use regulations. The Biden rule restored the definition to pre-2015 levels, which had been in place since the Reagan era. 

The measure also passed the House, with the support of Rep. Mark Amodei (R-NV) but none of the state’s House Democrats. The president said he will veto the resolution.

In an interview with The Nevada Appeal, Cortez Masto said Nevada’s arid climate necessitates unique water rules, noting she opposed the 2015 Obama-era expansion, along with ranchers and farmers in rural areas. She was not a fan of the Trump regulation either, calling it “bad news” in 2020 and saying it left 89 percent of Nevada’s streams without environmental protection.

In a statement to The Nevada Independent, Rosen echoed Cortez Masto’s concerns.

“I’m committed to protecting access to clean water, but the Administration’s rule may have unintended consequences for Nevada that make it harder for our ranchers and farmers to do their jobs,” she said.

Trade groups including the Nevada Farm Bureau, National Mining Association and the Nevada Manufacturers’ Association wanted the rule overturned.

The WOTUS rule has a long history in the Silver State. Then-Attorney General Adam Laxalt sued the Obama administration’s Environmental Protection Agency in 2015 over its WOTUS definition.

Horsford gets out ahead of White House on D.C. police bill

Last month, House Democrats were caught by surprise when President Joe Biden announced he would not veto a Republican resolution to revoke the new D.C. criminal code passed by D.C. City Council.

The measure had already passed the House with the support of 31 Democrats, including Rep. Susie Lee (D-NV). But the vast majority of them, including Reps. Dina Titus (D-NV) and Steven Horsford (D-NV), voted to uphold D.C. home rule, allowing the district to govern itself without congressional intervention. 

Biden’s announcement provided cover for the majority of Senate Democrats, including Sens. Cortez Masto (D-NV) and Jacky Rosen (D-NV), to vote with Republicans to pass the resolution, avoiding the “soft on crime” attacks sure to follow. So when Republicans introduced another resolution to overturn D.C. policy, Horsford made sure to get out in front of it.

On Wednesday, Horsford held a press conference asking the president to veto a new GOP-led resolution to overturn a D.C. police accountability bill. On Thursday, the president publicly confirmed he would do just that, marking a much smoother communication process between House Democrats and the president and demonstrating Horsford’s power as Congressional Black Caucus chair.

“Republicans are trying to play politics with public safety,” Horsford said at a press conference Wednesday. “They want you to believe that trying to find real solutions to saving lives is an attack on all police. Nothing could be further from the truth.”

Republicans’ latest resolution would overturn a D.C. Council bill aimed at improving police accountability, which contains many of the same provisions as the George Floyd Justice in Policing Act that passed the House in 2021, including a ban on the use of chokeholds, providing public access to police-worn body camera footage and officer disciplinary records, and making it more difficult to hire officers with a history of misconduct.

Horsford said the D.C. bill is in line with Democrats’ goals on public safety.

“The bill is about improving the relationship between law enforcement and the communities that they serve,” Horsford said. “If the resolution that they propose advances to the floor, the Congressional Black Caucus is calling on President Biden to state in no uncertain terms that he will veto the bill if it comes to his desk.”

On Thursday, an administration official told the Washington Post the president would do so.

“Congress should respect D.C.’s right to pass measures that improve public safety and public trust,” the official told the Post.

Biden’s alignment with House Democrats marks a departure from the anger he caused last time around when most of the caucus voted against the resolution overturning the criminal code. House Democrats had figured the White House was behind them when they voted in February, given that it had issued a Statement of Administration Policy (SAP) detailing Biden’s opposition to the resolution. 

But when Biden told Senate Democrats he would not veto the resolution if it passed the Senate, 33 Senate Democrats, including Cortez Masto and Rosen, voted for the resolution, and Biden signed it, marking the first time the federal government overturned a D.C. law in more than 30 years. 

As predicted, the episode became a proxy for crime messaging. The National Republican Campaign Committee began hammering Horsford and Titus in digital ads as defenders of “total lawlessness and anarchy” and “too extreme for Cortez Masto and Rosen”, according to NRCC spokesperson Ben Peterson. 

With House Republicans teeing up another home rule fight over a different D.C. law, Horsfordensured Biden did not leave House Democrats in the dark again. He told Politico that communications with the White House had been much more frequent on this go-around than on the last crime bill, having spoken with members of the administration several times already about the bill.

Emerging concerns on TikTok

TikTok CEO Shou Zi Chew’s congressional testimony last week revealed congressional skepticism over the app’s independence from the Chinese government amidst numerous proposals to ban the app. Rosen, who sits on the Senate Commerce Committee, and Titus, on the House Foreign Affairs Committee, will both have a role in further discussions. I asked each of their offices how they were weighing concerns about national security, data privacy and censorship over the app. 

While neither office was ready to commit to any of the proposals introduced thus far, they both cited national security as a major red flag.

“Congress needs to take a hard look at the Chinese government’s influence over TikTok’s operations, and this Administration should work with both parties to pursue a course that puts politics aside and our national security first,” Titus said in a statement.

Several of the existing bills give the Commerce Department the authority to ban the app, with some explicitly naming TikTok and one from Rep. Michael McCaul (R-TX), which Titus voted against reporting out of committee, mandating that the administration ban it.

Rosen also worried about Chinese access to American data.

“I have serious concerns about the national security threat that TikTok poses to our nation, and the recent hearing in the House raised more questions than answers,” Rosen said. ”We recently banned TikTok from federal government devices, and will need to continue to take action in a bipartisan way to protect Americans’ data from undue influence and intrusion from the Chinese government.”

Cortez Masto leads effort to reclassify xylazine

Cortez Masto is leading bipartisan, bicameral legislation to crack down on xylazine, a veterinary tranquilizer being mixed with fentanyl — an issue that’s drawn the attention of Senate Majority Leader Chuck Schumer (D-NY) as well.

Xylazine, also known as “tranq” or “zombie drug,” is an animal sedative increasingly being used as a cutting agent to devastating effect. Overdose deaths are up over 1,000 percent since 2021, according to Schumer, and it has no antidote — naloxone, the opioid overdose reversal drug, does not affect xylazine overdoses because the substance is not an opioid. 

Cortez Masto’s bill, introduced with Sens. Maggie Hassan (D-NH) and Chuck Grassley (R-IA), would classify xylazine as a Schedule III drug — a classification that includes ketamine and Vicodin — empower the Drug Enforcement Administration to track its manufacturing and issue a report on how it gets diverted to the illicit market, and declare it an emerging drug threat.

“Drug traffickers are going to great lengths to pad their profits with dangerous drugs like tranq, and we need to empower law enforcement to crack down on its spread in our communities,” Cortez Masto said in a release. 

Schumer’s office did not respond when asked if he supported Cortez Masto’s bill, but his interest in the subject gives it a rare opportunity to advance to the floor, which Schumer controls.

“When a new drug rears its ugly head, if you don’t nip it in the bud, it gets its tentacles deep in our society,” Schumer said during a press conference, adding that its use is most prevalent in the West and South.

In a Twitter video, Cortez Masto positioned her xylazine efforts as part of a broader portfolio of drug crackdowns she’s been leading since her time as Nevada’s attorney general. She added that she believed the legislation could break through gridlock.

While the bill would empower the DEA to target its illicit use, its legitimate use by veterinarians, farmers and ranchers would still be permitted under the new schedule — earning the support of the American Veterinary Medical Association. Cortez Masto’s office said she worked with ranchers and cattlemen to ensure their support, keeping Nevada’s agriculture industry from being affected. 

Trump indicted: What’s the delegation saying?

Amodei: 

“Never in our lifetime has one group of people felt so threatened by a presidential candidate, and that has been proven by District Attorney Alvin Bragg’s political persecution of Donald Trump. The American people are fully capable of choosing the next president, and they can do so without this cheap, political circus.

“I’d like to go back to the days when the conversations surrounding presidential elections were centered on who had the best ideas and who could best serve the American people. The fact that the national corporate media is so obsessed with the actions of one District attorney only emphasizes the sad fact that thoughtful policy discussions are now irrelevant in our culture. With record-high inflation and a crisis at our southern border, I’d say we all have a few more pressing issues to focus on.

“And to the people of Manhattan, I’m sure you are feeling much safer now thanks to the actions of your DA.”

Titus: 

No one is above the law.”

Horsford:

“Today, for the first time in history, a former president of the United States has been criminally indicted by a grand jury. This is a somber day for our country. The legitimate case brought against Donald Trump by Manhattan District Attorney Alvin Bragg is just the tip of the spear of legal worries for the former president. While the details of the indictment remain unclear at this time, we hope that the public will be able to learn more in the coming days. Now is not the time for the purely political attacks against the very open and transparent justice system that is holding someone accountable.

In the past several weeks, Donald Trump has repeatedly attacked Manhattan District Attorney Alvin Bragg and investigators on social media, showing the same irresponsibility and disdain for our institutions and law enforcement that led to the violent insurrection on our nation’s Capital on January 6th. We call on our Republican colleagues to put party aside and condemn the former president’s words and allow the legal process to move forward as it would for any other citizen, because no one is above the law, not even a former president of the United States.” 

Cortez Masto, Rosen and Lee 

Declined to comment.

Around the Capitol

Conservationists in Nevada cheered a new proposed Bureau of Land Management rule that gives conservation a more equal weight when considering uses of public lands.

Cortez Masto and Lee introduced bipartisan, bicameral legislation to make evapotranspiration data accessible for farmers and ranchers.

Cortez Masto and Sen. Amy Klobuchar (D-MN) introduced legislation to extend the Inflation Reduction Act’s penalties for drug manufacturers that raise the cost of drugs faster than the rate of inflation to drugs purchased on private insurance. Through the IRA, the federal government can do this for drugs purchased by Medicare beneficiaries. 

Horsford held a virtual press conference with Moms Clean Air Force Nevada, the Nevada Conservation League and a former UNLV student body president to call on the Biden administration to release a new round of clean car standards for vehicle models produced in 2027 and beyond. The standards currently go through 2026.

Titus introduced legislation to automatically extend health care benefits to Panama Canal Zone veterans for diseases contracted as a result of their military service by making the presumption that their condition is a result of their time in Panama, much like Congress did last year for veterans exposed to toxic burn pits.

Rosen introduced a bill to compel the Small Business Administration to create a digital hub for prospective small business owners to find all of the licensing and permitting information they need.

The Senate Committee on Homeland Security and Governmental Affairs voted to advance two Rosen bills out of committee — one to combat drug smuggling across the border, and another to bar members of Congress who are convicted of politics-related felonies from claiming their pensions (which could potentially affect Rep. George Santos (R-NY). 

Horsford became a founding member of the Equal Rights Amendment Caucus.

A resolution sponsored by Titus to honor fallen peace officers with a May 15 ceremony, including nine from Nevada, passed the House. 

The EPA announced Nevada will receive $3.72 million this year for clean water in the state, including upgrading wastewater and stormwater systems.

A Cortez Masto bill that would allow the Shoshone-Paiute Tribes of the Duck Valley Reservation to claim $5 million in interest from a water rights settlement dating back to 2009 advanced out of the Indian Affairs Committee.

Notable and Quotable

“Nevada is poised to serve our nation by delivering the lithium necessary for renewable energies, and I’m especially excited that this legislation will streamline the burdensome and bureaucratic permitting process that far too often keeps these critical minerals in the ground. “

Rep. Mark Amodei, on voting for House Republicans’ energy package, which passed the House this week

Legislative Tracker

The Week Ahead

Both chambers have two weeks off for Easter and Passover.

SEN. CATHERINE CORTEZ MASTO

Legislation sponsored:

S.993 – A bill to prohibit certain uses of xylazine, and for other purposes.

S.1118 – A bill to establish the Open Access Evapotranspiration (OpenET) Data Program.

S.1124 – A bill to amend the Consumer Financial Protection Act of 2010 to provide for whistleblower incentives and protection.

S.1139 – A bill to amend title XVIII of the Social Security Act to apply prescription drug inflation rebates to drugs furnished in the commercial market and to change the base year for rebate calculations.

S.1144 – A bill to establish a grant program to provide assistance to local law enforcement agencies, and for other purposes.

Legislation co-sponsored:

S.Res.129 – A resolution designating March 2023 as “National Women’s History Month.”

S.1001 – A bill to amend the Internal Revenue Code of 1986 to permanently extend the exemption for telehealth services from certain high deductible health plan rules.

S.1003 – A bill to modify the Federal and State Technology Partnership Program of the Small Business Administration, and for other purposes.

S.1026 – A bill to authorize the appropriation of funds to the Centers for Disease Control and Prevention for conducting or supporting research on firearms safety or gun violence prevention.

S.1031 – A bill to ensure affordable abortion coverage and care for every person, and for other purposes.

S.1042 – A bill to require the Director of the Office of Entrepreneurship Education of the Small Business Administration to establish and maintain a website regarding small business permitting and licensing requirements, and for other purposes.

S.1045 – A bill to amend the Federal Deposit Insurance Act to clarify that the Federal Deposit Insurance Corporation and appropriate Federal regulators have the authority to claw back certain compensation paid to executives.

S.Res.148 – A resolution recognizing the heritage, culture, and contributions of American Indian, Alaska Native, and Native Hawaiian women in the United States.

S.Res.151 – A resolution recognizing March 31, 2023, as “Cesar Chavez Day” in honor of the accomplishments and legacy of Cesar Estrada Chavez.

S.Res.154 – A resolution supporting the goals and ideals of International Transgender Day of Visibility.

S.1098 – A bill to prohibit the application of certain restrictive eligibility requirements to foreign nongovernmental organizations with respect to the provision of assistance under part I of the Foreign Assistance Act of 1961.

S.1157 – A bill to establish a MicroCap small business investment company designation, and for other purposes.

SEN. JACKY ROSEN

Legislation sponsored:

S.1042 – A bill to require the Director of the Office of Entrepreneurship Education of the Small Business Administration to establish and maintain a website regarding small business permitting and licensing requirements, and for other purposes.

S.1162 – A bill to ensure that broadband maps are accurate before funds are allocated under the Broadband Equity, Access, and Deployment Program based on those maps.

Legislation co-sponsored:

S.Res.129 – A resolution designating March 2023 as “National Women’s History Month.”

S.1003 – A bill to modify the Federal and State Technology Partnership Program of the Small Business Administration, and for other purposes.

S.Res.133 – A resolution honoring the 30th anniversary of the National Guard Youth Challenge Program.

S.1031 – A bill to ensure affordable abortion coverage and care for every person, and for other purposes.

S.Res.148 – A resolution recognizing the heritage, culture, and contributions of American Indian, Alaska Native, and Native Hawaiian women in the United States.

S.Res.151 – A resolution recognizing March 31, 2023, as “Cesar Chavez Day” in honor of the accomplishments and legacy of Cesar Estrada Chavez.

S.Res.154 – A resolution supporting the goals and ideals of International Transgender Day of Visibility.

S.1098 – A bill to prohibit the application of certain restrictive eligibility requirements to foreign nongovernmental organizations with respect to the provision of assistance under part I of the Foreign Assistance Act of 1961.

S.1143 – A bill to direct the Secretary of Defense to carry out a grant program to increase cooperation on post-traumatic stress disorder research between the United States and Israel.

REP. DINA TITUS

Legislation co-sponsored:

H.Res.263 – Condemning Turkey for its illegal occupation of Cyprus and encouraging President Biden to make the resolution of the Cyprus problem a top foreign policy priority.

H.R.1828 – To protect victims of crime or serious labor violations from removal during Department of Homeland Security enforcement actions, and for other purposes.

H.R.1838 – To prohibit the application of certain restrictive eligibility requirements to foreign nongovernmental organizations with respect to the provision of assistance under part I of the Foreign Assistance Act of 1961.

H.Res.269 – Recognizing that it is the duty of the Federal Government to develop and implement a Transgender Bill of Rights to protect and codify the rights of transgender and nonbinary people under the law and ensure their access to medical care, shelter, safety, and economic security.

H.R.12 – Women’s Health Protection Act of 2023

H.R.2403 – To amend chapter 44 of title 18, United States Code, to strengthen the background check procedures to be followed before a Federal firearms licensee may transfer a firearm to a person who is not such a licensee.

H.R.2418 – To require lost or stolen firearms to be reported to law enforcement authorities within 48 hours, and for other purposes.

H.R.2431 – To authorize Department of Veterans Affairs health care providers to provide recommendations and opinions to veterans regarding participation in State marijuana programs.

H.R.2447 – To amend title 38, United States Code, to provide for a presumption of service connection for illnesses associated with service in the Armed Forces in the Panama Canal Zone, and for other purposes.

REP. SUSIE LEE

Sponsored:

H.R.2429 – To establish the Open Access Evapotranspiration (OpenET) Data Program.

Co-sponsored:

H.R.1843 – To amend the Internal Revenue Code of 1986 to permanently extend the exemption for telehealth services from certain high deductible health plan rules.

H.R.12 – Women’s Health Protection Act of 2023

H.R.2403 – To amend chapter 44 of title 18, United States Code, to strengthen the background check procedures to be followed before a Federal firearms licensee may transfer a firearm to a person who is not such a licensee.

REP. STEVEN HORSFORD

Co-sponsored:

H.Res.261 – Reaffirming the importance of diplomacy and development in United States-African Union relations, promoting strategic partnerships and shared objectives between the United States and the African Union, and expressing strong support for the successful implementation of the African Continental Free Trade Area.

H.R.12 – Women’s Health Protection Act of 2023

H.R.2403 – To amend chapter 44 of title 18, United States Code, to strengthen the background check procedures to be followed before a Federal firearms licensee may transfer a firearm to a person who is not such a licensee.

The post D.C. Download: Bank failures, tranquilizers, TikTok, and crime appeared first on The Nevada Independent.

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