By Randy Myers
Policy strategist Charlie Schreiber predicts a tight election for control of the White House and Congress. But regardless of the outcome, he told attendees at the 2024 SVIA Fall Forum on October 15, he expects that majorities in the House and Senate will remain narrow next year, placing a premium on bipartisan support for any legislation Congress hopes to pass.
Schreiber, a policy strategist and principal with bipartisan public policy consultancy Mindset, and formerly a senior counsel for the House Committee on Financial Services, was joined in addressing the SVIA by his colleague Heather Slavkin Corzo. She is a former policy director for the U.S. Securities and Exchange Commission (SEC) who joined the Mindset team as a principal in July. The two spoke about how the election might impact pending legislation and updated their audience on key regulatory initiatives in the financial services arena.
While the presidential race is attracting the bulk of national attention in the 2024 election, Schreiber noted that it is an unusual election year for Congress with 53 legislators retiring from the House and Senate. One consequence of all those retirements, he said, is that there is the potential for quite a bit of change in leadership in the House, currently controlled by Republicans, and the Senate, currently controlled by Democrats. The Senate Finance Committee alone, he noted, is expected to welcome four new members.
Two Senate races that are of particular importance to the investment community, Schreiber said, are those for the seats of incumbent Democrats Jon Tester in Montana and Sherrod Brown in Ohio. Tester, whose race is widely expected to help determine control of the Senate, chairs the Senate Veterans’ Affairs Committee but also sits on the Senate Commerce, Indian Affairs, Banking, and Appropriations committees. Brown is chair of the Senate Banking Committee.
“If they lose, how do they use their remaining months?” Schreiber asked. “Even if they win, but the Senate flips, how does that change their impact on legislation that we’re following quite closely?”
Regardless of which party emerges victorious in November, Schreiber pointed to two key pieces of legislation they will have to address quickly before the end of the Congress: an appropriations bill to keep the government funded, and the National Defense Authorization Act.
On a positive note, for the financial services industry, Schreiber said a lot of the legislative work taking place on retirement issues is in a good position relative to bills in other areas because retirement legislation tends to attract more bipartisan support.
On the regulatory front, Slavkin Corzo said it is possible that the U.S. SEC will finalize a number of rules before the end of the year.
One SEC proposal attracting a lot of interest, Slavkin Corzo said, is the Predictive Data Analytics (PDA) rule, which aims to ensure that entities using advanced technologies like artificial intelligence to advise investors are held to the same standards in terms of client interactions as traditional investment advisors.
Originally proposed in 2023, Slavkin Corzo said the Commission’s most recent Unified Agenda indicated that it intends to repropose the rule.
“It (the PDA rule) is one the chair is quite personally invested in,” Slavkin Corzo said, referencing SEC Chair Gary Gensler. “He was a professor at MIT before he joined the Commission and taught a class on AI and finance. If there is one … reproposal that’s going to come out before the end of the year, I would guess that this is at the top of the list.”
Other proposed rules that regulators continue to consider, Slavkin Corzo said, include SEC rules focused on safeguarding client assets and liquidity in open-end funds, a Department of Labor rule about valuing employee stock ownership plans, and Department of Labor and U.S. Treasury rules around implementing provisions of the SECURE 2.0 Act of 2022.
“There also were some rules that Treasury worked on with the SEC related to transparency around foreign investors and beneficial owners, and anti-money laundering, that are in the works and may also be finalized in the coming months,” Slavkin Corzo said.
In response to audience questions, Schreiber and Slavkin Corzo said they saw little momentum in Washington on constitutional overhaul efforts like increasing the number of representatives serving in the House, expanding the Supreme Court, or getting rid of the Electoral College.
