Liberal Sen. Elizabeth Warren, D-Mass., called Watt “an excellent choice” to lead the FHFA.
“Congressman Watt is a thoughtful policymaker with a deep background in finance and a long record as a champion for working families,” the Banking Committee member said. “The Senate should confirm Congressman Watt soon so he can get to work stabilizing shaky housing markets and helping struggling homeowners.”
Warren added that the administration “needs to remove Ed DeMarco as director of the FHFA. Under DeMarco’s leadership, the FHFA has refused repeatedly, often with cold indifference, to work with families struggling to save their homes.”
Rick Judson, chairman of the National Association of Home Builders, applauded the nomination of Watt.
“Rep. Watt brings years of experience to this position at a pivotal moment as our nation’s housing market recovers,” Judson said in a written statement. “NAHB looks forward to working closely with Rep. Watt to help address the many complex challenges facing the U.S. housing finance system upon his confirmation by the U.S. Senate.”
For Republicans, however, the move to replace DeMarco with Watt represents a major battle over housing policy and the sharply different views that the parties hold over government backing for the fragile mortgage finance market.
A senior financial industry lobbyist said he expects “an uphill battle” for Watt to get confirmed.
Obama has previously struggled to fill the position. After he nominated Joseph A. Smith Jr., a respected North Carolina banking regulator, in November 2010, Senate Republicans promised to filibuster Smith’s nomination because they said he wouldn’t be an independent regulator. Smith declined to be renominated in January 2011.
Obama promised housing advocates that he would move to replace DeMarco quickly if he won re-election.
Alan Jenkins, executive director of The Opportunity Agenda, a housing policy advocacy group, said in a statement praising Watt’s nomination that DeMarco “has doggedly blocked principal correction — adjusting mortgage principal to reflect the fair market value of homes that are now worth less than homeowners owe on their mortgages — for the 30 million loans owned or backed by Fannie and Freddie.”
Despite the political furor around the agency, DeMarco issued a statement pledging to help the man who would succeed him. “We look forward to working with Congressman Mel Watt as he prepares for his confirmation hearing and for undertaking the important work at FHFA,” DeMarco said.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.