HUD
Secretary Julian Castro's February 11 Financial Services Committee debut was painful.
Questions of issue command raised by the Secretary's Daily Show appearance were
clearly answered within 20 minutes of the committee being called to order.
Committee
Republicans made their points quickly and effectively: FHA is far below its
statutory capital requirement, in violation of the law as they see it, and in
no financial condition to reduce mortgage insurance premiums. The only Democrat to offer an effective
rebuttal was Rep. Capuano, but it wasn’t enough. The Secretary failed to defend
FHA or even come armed with basic facts about the performance and condition of
FHA’s book of business.
You knew it was a bad day when NAR released a statement at the hearing's
conclusion offering a robust defense of the FHA premium cut. MBA's David
Stevens followed suit, sharing his thoughts in The Hill.
***
Two weeks later, Secretary Castro found himself back on Capitol Hill in
front of a different congressional committee. That committee found a different
Secretary Castro.
The Secretary Castro who testified before the House THUD Appropriations
Subcommittee on February 25 was knowledgeable, in command of facts and program
details, and generally acquitted himself well. While members did not question
him as aggressively as FSC Republicans, this time the Secretary responded when pressed.
It is hard to see a Cabinet level official fall so flat at the beginning
of their tenure and HUD, in particular, needs steady-handed
leadership.
I think it fair to say that members of both parties lost some measure of
respect for the Secretary and he must acquit himself well in his next Financial
Services appearance. Based on this most recent performance I think the
Secretary is well on his way to recovery.
***
One final observation. It was good to hear members asking questions of the
Secretary on housing policy that had nothing to do with housing finance. There
was substantive discussion on targeting housing vouchers; Moving to Work; Jobs-Plus;
and the HOPWA funding allocation formula, just to name a few.
You don’t see those debates in Financial Services.
