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Shelby has quietly become the single biggest thorn in Obama’s side; here’s how

Sen. Richard Shelby (R-Ala.)
Sen. Richard Shelby (R-Ala.)

The end of the year is typically a time when people put aside their differences and come together to celebrate the holidays. The same could be said of the U.S. Senate, where presidential nominees whose confirmations have been held up for one reason or another are finally allowed to pass.

But as Politico notes, “this is not a typical year.”

“Nineteen potential judges, a half-dozen ambassadors, a terrorism financing specialist and two high-ranking State Department nominees are awaiting confirmation votes on the Senate floor, a backlog that has this GOP-led Senate on track for the lowest number of confirmations in 30 years,” writes Politico’s Burgess Everett. “The Senate Banking Committee hasn’t moved on a single nominee all year.”

The Banking Committee is chaired by Senator Richard Shelby (R-Ala.), whose refusal to budge on over a dozen nominees has dealt a blow to numerous Obama administration priorities.

While Senate Majority Leader Mitch McConnell has acquiesced and allowed several judicial nominees and ambassadors to be confirmed, Shelby has stubbornly held out.

Other senators are also holding up nominees. Sen. Marco Rubio is blocking President Obama’s choice for ambassador to Mexico because of her role in normalizing U.S. relations with Cuba, and Sen. Chuck Grassley (R-Iowa) is blocking the confirmation of the president’s nominee to be the State Department’s top attorney, just to name a couple.

But no senator has been quite as unyielding in their opposition to Obama’s nominees as Shelby.

Politico explains:

(M)ore than a dozen nominees (are) mired in the Senate Banking Committee, which has the dubious distinction of being the sole Senate panel that has not cleared a single (Obama) administration nomination this year.

“There are substantive complaints about none of them. There is opposition based on their history, record, qualifications to none of them. It’s all about Obama,” said Ohio Sen. Sherrod Brown, the top Democrat on the Banking Committee. “And because they don’t like the Iran nuclear agreement, we shouldn’t confirm somebody who will make us safer?”

A frustrated Brown took to the Senate floor Wednesday to force a confirmation vote on… a host of other nominees stuck in his committee. The panel’s chairman, Sen. Richard Shelby of Alabama, swiftly objected to each of Brown’s attempts.

“That’s a policy decision,” Shelby said.

Among the nominees Shelby is blocking is Patricia Loui-Schmicker, who the president nominated for a second term on the Export-Import Bank’s Board of Directors.

The Ex-Im Bank, as it is known, was originally chartered by progressive icon Franklin D. Roosevelt in the 1930s. It was a “federal government corporation” that provides taxpayer-backed loans to foreign entities who want to buy American-made goods, but cannot secure credit in the private sector because of the risks. The bank’s charter mandates at least 20 percent its outlays benefit small businesses, but that rule has been frequently violated over the years.

In 2013, 76 percent of the bank’s spending went to its top ten beneficiaries. That year Boeing, the largest beneficiary of the bank for several years, received $8.3 billion in aid from the guaranteed loans taken out by the purchasers of their exports.

In spite of an intense lobbying effort by big business groups, President Obama and Republican congressional Leadership, the bank’s charter expired after Congress did not renew it by the June 30, 2015 deadline.

“After years of efforts to reform the Ex-Im Bank, it has become clear to me that its problems are beyond repair and that the Bank’s expiration is in the best interest of American taxpayers,” Shelby told Yellowhammer at the time. “Nearly 99% of all American exports are financed without the Ex-Im Bank, which demonstrates that subsidies are more about corporate welfare than advancing our economy.”

But a coalition of Republicans and Democrats ultimately managed to resurrect the bank by reauthorizing it in this year’s Transportation Bill.

However, as Diana Katz of the Heritage Foundation explains, the Ex-Im bank cannot issue any loans over $10 million without direct action by its board of directors. And since Senator Shelby is holding up the confirmation of Mrs. Loui-Schmicker, the board does not have the required minimum of three active members to take action on, well, anything.

“Checks and balances are a wonderful feature of our system of governance,” said Katz. “There’s no shame in using allowable procedures to check the crony impulses of Congress. No Ex-Im subsidies is the best policy, but limits on Ex-Im subsidies is the next best thing.”

Shelby’s efforts garnered high praise from Heritage Action CEO Michael Needham, whose organization has been among the most vocal opponents of the Ex-Im Bank’s “cronyism.”

Holding up nominees is often used as leverage to get concessions from the other side of the aisle.

Shelby has often indicated he would like to roll back Dodd-Frank, the sweeping — many conservatives would say onerous — financial regulatory reform package passed by Democrats in response to the so-called “Great Recession.” He has also placed himself at the center of housing finance reform, an issue that doesn’t grab headlines but is incredibly important for the U.S. economy. Close to 100 percent of the U.S. mortgage market is currently backed by the federal government. A bipartisan group on the Senate Banking Committee has been trying to reform the government’s role in the market, but many conservatives don’t believe their efforts go nearly far enough and leave the government no less involved than they were prior to the 2008 crash.

By holding up confirmations, Shelby could be creating the leverage needed to ultimately achieve those policy goals, but in the meantime, he’s ripping President Obama’s Christmas nominee wish list to shreds.

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