Democrats Stick by Maxine Waters for Finance Panel Despite Controversy

(Bloomberg) -- Representative Maxine Waters’ Democratic colleagues are sticking by her as the party’s top candidate to run the powerful Financial Services Committee despite the controversy over her urging supporters to publicly confront Trump administration officials on immigration.

Waters, a 13-term California Democrat, is the senior Democrat on the committee and if the party wrests control of the U.S. House from Republicans in the November election, she’d be in line to become chair of the panel. It oversees regulators including the Federal Reserve and U.S. Securities and Exchange Commission and writes laws affecting Wall Street.

While House Democratic leader Nancy Pelosi and some of her colleagues chided Waters for the remarks at a rally last weekend, a party leadership aide said most Democrats in the House still support her as the ranking member of the finance committee.

“This doesn’t disqualify her from being chairman but I would say to her don’t do it again,” said Henry Cuellar, a Democrat from Texas. “I’m not in favor of trolling people like that.”

Waters told supporters at a rally that they should publicly confront members of President Donald Trump’s administration as a response to the White House’s controversial immigration policy of separating parents from their children at the border.

“If you see anybody from that Cabinet in a restaurant, in a department store, at a gasoline station, you get out and you create a crowd. And you push back on them. And you tell them they’re not welcome anymore, anywhere,” she said, according to a video of the event.

That followed White House press secretary Sarah Sanders tweeting about being asked to leave a restaurant in Lexington, Virginia, because she worked for Trump. The president responded to Waters on Twitter, calling her “an extraordinarily low IQ person,” and saying she called for harm to his supporters.

Pelosi criticized Waters’ rhetoric but also laid the blame on Trump, saying his “daily lack of civility has provoked responses that are predictable but unacceptable.”

House Speaker Paul Ryan has called on Waters to apologize and conservative Republicans have filed legislation to formally censure her for the remarks.

Representative John Yarmuth of Kentucky said Waters told fellow Democrats during a Tuesday morning meeting that even if some of them are angry with her for her remarks, she would continue speaking out.

“I wouldn’t have said what she said. I don’t believe any of that will change the direction of the country," said Yarmuth, who is line to take over the Budget Committee if Democrats win control of the House. "Elections will."

Even before the controversy over her remarks, some in the finance industry have been fretting over the possibility of Waters leading the financial services committee. That’s because she supports stiffer rules on big banks and will likely try to use her subpoena power to investigate firms she’s long chastised, like Wells Fargo & Co. and Deutsche Bank AG.

“Representative Waters is still expected to take the gavel if Democrats win the House, but her comments serve as an unmistakable signal that moving even the narrowest financial regulatory measures in the next Congress will be nearly impossible," said Isaac Boltansky, financial policy analyst at Compass Point. “All indications are that the House Financial Services Committee could prove to be one of the central fronts in the messaging war ahead of the 2020 election."

©2018 Bloomberg L.P.

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