Maxine Waters — the fiery liberal from Los Angeles known for calling House Republican leadership “demons” and threatening to nationalize oil companies — has gone from the scourge of Big Business to a sympathetic ally for corporate America.
It’s no accident.
Waters is executing this transformation by seizing on the growing divide between conservative Republicans and Big Business and leveraging her position as the top Democrat on the House Financial Services Committee, where in the coming weeks she will play a role in the battles over extending a terrorism insurance program and the Export-Import Bank.
A large part of her strategy has been to seek out opportunities to play the yin to committee Chairman Jeb Hensarling’s yang. When the Texas Republican’s free-market agenda has led him to oppose government programs the business community supports, Waters has been ready to jump in and deal.
“Here you have industries who’ve always had support of the opposite side of the aisle who now, for whatever reasons — be they political or just change in philosophy or whatever — have flipped the script. And that industry needs some friends,” Waters, 76, said in an interview in her Capitol Hill office, describing her strategy of embracing the gap between Hensarling and the business community. “So you have an opportunity, if you believe in what you’re doing, to work with them — even if you’ve never worked with them before and even if you’re never going to work with them again.”
Two years ago, this was not the kind of conciliatory tone that most industry executives thought they’d be hearing from the 12th-term Californian.
In fact, when Waters was preparing to take on the top Democratic position on the Financial Services Committee in the fall of 2012, her detractors had plenty to grumble about. She had only recently been exonerated from an ethics investigation tied to the 2008 bank bailout; many wondered if she could fill the large void left by her predecessor, Barney Frank; and the business community and many Republicans viewed her warily.
Some two years later, even some of her GOP colleagues speak fondly about working with Waters.
“She’ll meet you in the middle — or towards the middle, at least,” Rep. Steve Stivers, an Ohio Republican on the committee.
If Waters is keeping an “open-door policy” to industry officials, Hensarling’s message often sounds more like: “Here’s what going to happen,” said one lobbyist who requested anonymity to avoid antagonizing lawmakers who oversee the industry that lobbyist represents.
“He’s been so unreasonable that it helps her look and sound reasonable by comparison,” the lobbyist said. “And she’s capitalized on the opportunities that he’s given her.”
In Hensarling’s view, that’s hardly criticism as he touts his agenda as an effort to end “crony capitalism.”
“Chairman Hensarling will continue to represent the hardworking American taxpayers of Main Street and he will leave it to others to represent the lobbyists of K Street,” said Financial Services Committee spokesman David Popp.
The first big opportunity to land in Waters’s lap this Congress was the debate earlier this year to delay the rising price of government-subsidized flood insurance for homeowners.
House and Senate Republicans elevated the issue last year with bills to delay rate increases Congress set in motion in 2012. It was familiar territory for Waters, who co-authored the 2012 flood insurance overhaul that led to the problem. It was an attempt to improve the indebted program’s poor finances, but it wound up giving members sticker shock.
The program is the responsibility of Hensarling’s committee. He attempted to work with House Republicans on a proposal to ease the impact of the rate hikes. But there was only so far he was willing to go for an “unfair and unsustainable middle-income entitlement,” and talks fell apart.
Recognizing that many Republicans were antsy to act, Waters began convening bipartisan meetings and conference calls. At times, Waters said she was speaking daily with Rep Steve Scalise (R-La.), now the majority whip, whose Gulf Coast district surrounds Lake Pontchartrain.
When House GOP leadership ultimately decided that Hensarling’s proposal didn’t have enough Republican support, Waters found herself a lead negotiator working with former House Majority Leader Eric Cantor (R-Va.) to finalize a bill that could get through the House.
“The support was coming together from both sides of the aisle because the constituents were saying: You better fix this. So that provided a real opportunity to make something happen,” she said.
The House passed the bipartisan flood insurance bill in a 306-91 vote in March, and it was signed into law a couple weeks later.
Since the flood insurance debate, Waters says she has identified several other potential openings to capitalize on the split among House Republicans in the coming months, including reauthorization of the Terrorism Risk Insurance Act and the Export-Import Bank. Both issues have bipartisan support and are top legislative priorities for the business community.
Extending Ex-Im’s charter faces deep opposition from a faction of House Republicans, including Hensarling. Waters has been working with GOP Rep. Gary Miller of California since July to draft a bill that would reauthorize the bank and incorporates “a responsible set of reforms” to the agency, according to a committee aide, and hopes to attract support for the proposal from both sides of the aisle.
On TRIA, Hensarling has at times challenged the industry to oppose his vision for scaling back the program that covers insurance industry losses after big terrorist attacks. The congressman’s legislation to extend and reform TRIA faces opposition from business groups, including the U.S. Chamber of Commerce and some Republicans.
With little time left on the legislative calendar, the insurance industry is ramping up opposition to Hensarling’s bill.
The rumblings are starting to grow among Republicans, too. Waters said she’s received private indications from GOP colleagues that they’d back an alternative to Hensarling’s TRIA proposal.
“They don’t undermine, necessarily, their chairman or talk about their frustration with him,” she said. “But members have ways of talking to let you know that should the opportunity present itself for a vote, that they’ll be with you.”
During the same week in July that the Senate passed a seven-year TRIA extension 93-4, Waters convened a meeting with industry officials, and she is currently in talks with Republicans who support a clean TRIA reauthorization, such as Rep. Peter King. The New York Republican has taken a leading role in the House GOP in speaking out against Hensarling’s current proposal.
“Twenty years ago, if people thought that Maxine and I would agree on anything, I’d say they were crazy,” King chuckled. “I find her to be very professional, keeps her word, and she’s been an ally on some issues.”
Justin Lumadue, the Chamber of Commerce director of congressional and public affairs said it has been “enjoyable” to work with the California Democrat and her office on TRIA.
“In this instance, we happen to be more aligned with the ranking member than we do the chairman in coming up with a final solution on this,” Lumadue said.
Not everyone is impressed with Waters’s embrace of parts of the business lobby’s agenda. Conservatives supportive of Hensarling’s approach say it smacks more of opportunism than principal at work.
“Maxine Waters was against the Export-Import Bank before she was for it,” Veronique de Rugy, a senior fellow at the Mercatus Center, wrote on The National Review’s website in July, noting the California Democrat gave a floor speech in 2002 criticizing the agency for helping U.S. companies that send jobs overseas. Waters said she changed her mind after learning more about Ex-Im.
Waters also said in the interview that she hasn’t been fundraising more this Congress than in the past. Nevertheless, her campaign chest reflects the perks of being on an A-list committee and the raised profile that comes with it. The congresswoman has received more than $125,000 from banking, insurance and financial services PACs in the 2014 cycle so far, up from around $42,000 the previous cycle, according to an analysis of her FEC filings.
While Waters has emerged as a champion of several of the business community’s major legislative priorities this Congress, she has also maintained opposition to several tweaks to the 2010 Dodd-Frank law backed by Wall Street, at times pitting herself against other House Democrats.
While her opposition to proposals to rewrite rules for financial markets hasn’t been universal — she backed a high-priority fix to Dodd-Frank for insurance companies worried about Federal Reserve capital requirements, for example — Wall Street reform advocates say they have been pleased with her work.
“She’s done a very good job of rebutting and responding to Wall Street’s war on financial reform and what I would call the mountain of fact-free industry propaganda that gets dumped on legislators,” said Dennis Kelleher, president of Better Markets, a group that advocates for stricter regulation of big banks and financial markets.
This Congress, Waters said she has had the chance to get to know Republicans and industry groups in ways that she hasn’t before. But whether those working relationships will last depends on what issues she chooses to focus on next, she said.
"We are recognizing who our friends are,” Waters said. “Mr. King is my friend today. He may not be tomorrow, but we’re friends.”
Read full story at Politico.com