Independent Banker - October 2020 - 42

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before hostile senators. " I'd imagine, "
he says, a Republican Senate " would
really grill [Biden's pick] when they
testify before Senate for creating
bottlenecks to lending and putting
companies out of business. "
A Biden administration might
also mean more federal involvement
within the banking sector and even
a few challenges to current notions
of what types of institutions can
provide banking services, Merski
says. He notes, for instance, that
proposals to allow the U.S. Postal
Service to provide " bank-like
services " to unbanked individuals
might gain traction in a Democratic
administration. In fact, Sen. Kirsten
Gillibrand (D-N.Y.) has proposed the
Postal Banking Act as a way of serving
the one in four Americans who are
currently unbanked or underbanked.
Thomas says a Biden presidency
does not necessarily spell trouble
on all issues of who can provide
banking services to whom. A Biden
administration might, for instance,
be a boon for community banks by
allowing marijuana banking or the
ability for banks to provide services
to marijuana-related businesses
operating in states where it is legal.
(Currently, 33 states, the District of
Columbia, Puerto Rico and Guam
have legalized the use of cannabis to
some degree.) ICBA's efforts to ease
restrictions on marijuana banking
stalled when the pandemic hit but
might gain steam again " if Democrats
were in power, " Thomas says.
Finally, she says that a Democratic
administration might help community
banks forestall efforts by fintechs to
enter the banking business through
hybrid-type banks. " I think, " she adds,
" you could see a little bit more of a
go-slow approach on efforts like that if
the Democrats are in power. "
+ SCENARIO 3:
TRUMP IS REELECTED, BUT
DEMOCRATS FLIP THE SENATE
Getting legislation passed with a
divided federal government is always
a challenge, especially since the
Senate must have 60 votes to enact
legislation, which is then subject to
presidential veto. Thomas says in
the past three or more years, a host
of deregulatory measures have been
adopted. Although Trump has yet
to confront reregulation because
Congress has either been divided or
squarely in Republican hands, she
anticipates that " reregulatory efforts
are the types of things you might see
this president vetoing. "
Merski says a Democratic Senate
HOW SWIFTLY
WILL WE SEE
CHANGE?
While it's easy for community
bankers to focus like a laser
beam on their industry
issues, these issues might not
rise to the top of the agenda
come Inauguration Day.
Karen Thomas, ICBA's
senior executive vice
president of government
relations and public
policy, says new rules and
regulations typically take
time to implement. " Unless
you're in a crisis, " she says,
" the legislative process goes
pretty darn slowly. " What's
more, she adds, " in this
election season, there has
not been much focus at all
on financial industry issues. "
The real wild card is
COVID-19. Thomas says
support for small businesses
in the pandemic has
been bipartisan, and this
support has been crucial for
community banks.
So, when it comes to
" WHILE THE PRESIDENT
MAY NOT HAVE DIRECT
CONTROL OVER A
BANKING AGENCY
OR A REGULATOR,
[THEY SET] THE TONE. "
-Ron Haynie, ICBA
42 Q ICBA Independent Banker Q October 2020
reading the tea leaves
on how quickly a new
administration might enact
policy changes that affect
community banks, this
election is particularly
difficult to call.
" If we're still in pandemic
mode after November, the
pandemic will be the key
issue, " Thomas says. " And
the longer it goes on, the
larger the potential impact
on the economy. "
Independent Banker - October 2020

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