Scott Garrett, who has been the chief U.S. House overseer of the Securities and Exchange Commission as the chair of the House Financial Services Committee’s Capital Markets Subcommittee, went down to defeat Tuesday night.
No one is pre-ordained to succeed him as the subcommittee chair and top House SEC watchdog as Financial Services Chair Jeb Hensarling is one of the few committee chairmen who does not automatically select subcommittee chairs on the basis of seniority.
Garrett, a seven-term New Jersey Republican, went down to defeat at the hands of Josh Gottheimer, who became a speechwriter for President Bill Clinton at 23.
Gottheimer was able to outspend Garrett by nearly two to one in large measure to the incumbent Republican’s reputation as an acerbic outcast by Democrats and members of his own party.
Sensing blood, the Democratic Congressional Campaign Committee funneled $1.1 million into Gottheimer’s campaign.
A vocal opponent of same-sex marriage, Garrett was the only member of the New Jersey Congressional delegation to vote against health-care benefits for 9/11 first responders.
In his five years atop House SEC oversight, Garrett has been more bark than bite, with the 2012 JOBS Act the only major piece of legislation impacting the SEC considered by his unit that became law.
He was suspicious of letting Finra or other self-regulatory organizations examine advisors, arguing the fee they would have to pay for the exams would be a tax.
Garrett was a prime mover of the Investment Advisers Modernization Act, which would remove testimonials and investment past performance advertisements by advisors to wealthy individuals and ease private fund disclosure requirements.
The bill passed the House in early September, but seems likely not to be considered by the Senate in the coming lame duck session.