Governor Pawlenty And The Financial Services Roundtable

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Credit: Gage Skidmore

Conservatives pride themselves on objective analysis of complex political issues, and the August 14, 2018 Minnesota primary election demands such critical thought as two front-running candidates have emerged in our governor’s race.

There is also an unusual question complicating that competition.  That unanswered question by some might be summarized as, “Whether or not Tim Pawlenty, Minnesota’s last elected Republican governor (both 2002 and 2006), is still a worthy candidate after his decision to leave Minnesota and accept the top job at the Financial Services Roundtable (FSR) in Washington, DC, rather than running for a third term as Minnesota governor.”

But first a disclaimer.  I have no axe to grind here.  I know both Commissioner Johnson and Governor Pawlenty from their past campaigns.  My wife and I were active supporters and financial contributors to both in the past.  We consider both to be quality men.  We shall enthusiastically support whichever becomes the party’s final selection.

Two major considerations add a sense of urgency to this issue.

  • The party’s convention endorsed candidate is Jeff Johnson, who was also the party’s candidate for governor in 2014.  Pawlenty entered the governor’s race too late for the convention fight, which means the selection shall be concluded during the Minnesota primary election.  Between now and then both candidates shall be campaigning aggressively; however, during that time many believe that a large share of Republican activists and contributors may sit on the sidelines waiting for the smoke to clear.
  • National Democrat party funding is expected to target Minnesota because of the state’s unique election opportunity this November.  In addition to the governorship and all other state-wide offices, there are two United States Senate seats (one without an incumbent), three of Minnesota’s eight United States House seats are also without incumbents, and a fourth district has been called a toss-up.  It’s not hyperbole to state that never before has unity in the state’s Republican party been more important.

It seems entirely appropriate for the two Republican candidates for governor to compete on the basis of past achievement and policy positions.  However, for some Pawlenty’s time leading the Financial Services Roundtable may be a decisive factor.  Should it be?   Yet Interesting enough, despite the concern voiced by many, few critical articles to date have gone much beyond generalizing a class warfare argument, or arguing against a single FSR policy they disliked.  After some research I learned why.  Simply put, the sweep and scope of the issues addressed during 2017 (for example) by the largest financial services organization in the world’s largest economy is truly immense.  The student finds that the FSR was actively involved in dozens of important national issues, and perhaps hundreds more regional issues – each complex even to the experts.

Where to start?  How should we begin an analysis of an organization involved in so many complex issues?  How do we weigh and balance the policies we agree with against we don’t?  In other words, how to be fair.

As an example of this approach here is a brief discussion of just five of the huge range of issues the FSR supported in 2017.  The ones selected are all topics likely to be familiar to Minnesota voters.

  • I liked it that the FSR was a leader in the bank and credit card industry’s efforts to strengthen the protection of consumer data.  But Democrats complained the industries were not trying to do enough, and the government might best lead the effort.  Both sides did seem to like the FSR’s support for a plan coordinating the efforts by both the government and private sectors to reduce cyber-security threats.
  • I’m unsure about the FSR’s support for reauthorizing the National Flood Insurance Program.  Some critics said it inappropriately encourages people to build houses in high risk areas; but it passed Congress with bipartisan support.
  • I liked the FSR supporting the president’s tax cut including the elimination of most federal income taxes for low income individuals, and the more simplified rules and lower taxes on many small businesses.  Nancy Pelosi condemned the whole act, calling it a “give away to the rich.”
  • I liked that the FSR helped kill the Consumer Financial Protection Bureaus (CFPB) ability to punish financial service and credit granting firms if their mix of minorities and non-minority customers didn’t meet arbitrary shares – none based on objective data such as credit risk.  Senator Elizabeth Warren insists that CFPB unelected appointees should decide what constitutes “racism.”
  • I’m also unsure about the FSR’s support for the establishment of simplified state run small business IRA plans.  These are supposed to allow very small employers set up pension plans. Democrats seemed to dislike the idea that multi-employer pooling was involved to spread the risks and costs.

How to weigh these differences?  While pondering this complexity a friend suggested a more pragmatic approach. He recommended looking into which organizations supported and which opposed the overall FSR policy agenda.  He said the idea came from the old adage that says, “A wise person chooses friends from among those who share his enemies.”  The implication being that if large liberal organizations love the FSR policy agenda, the FSR is probably not a friend to conservatism.  However, if far left organizations disagreed with the FSR agenda, it would probably be reasonable to conclude that the FSR is a supporter of many conservative values.

For this comparison I selected perhaps the most aggressive critic of the Financial Service Roundtable.  It is the interestingly named “Coalition for Sensible Safeguards.”  Their March 2018 attack titled “The Financial Services Roundtable’s Dangerous Policy Agenda” was proof of their usefulness in judging the FSR’s conservative credentials.

See below for the list of the eighty-one national members (there are also ninety-one state members) of the Coalition for Sensible Safeguards.  This list can fairly be titled the FSR’s enemies list in 2017, the last year of Governor Pawlenty’s FSR involvement.

I invite readers to look the list over and judge for themselves.  Many of the organizations are well known.

My personal conclusion based upon this list is that the FSR does not appear to be an organization about which any conservative working there should be ashamed.

THE FINANCIAL SERVICES ROUNDTABLE’S ENEMIES LIST

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