Two bombshells landed in the Senate this week, and they could spell trouble for the Republican majority in November.
On Wednesday, the FBI seized the mobile phone of Senator Richard Burr (R-NC). The next day, Burr stepped down from his prominent role of chairman of the Senate Intelligence Committee.
An investigation into Burr’s stock sales in February – one week before the market tanked – has been underway for weeks. Still, his Senate colleagues were caught off guard by the sudden developments, based on Politico’s reporting.
“I didn’t see this coming,” remarked Senate Minority Whip Dick Durbin (D-Ill.).
Senator Susan Collins (R-Maine) added, “I’m saddened by this turn of events. I know that he was being fully cooperative, so I don’t understand yesterday’s events….I’ve talked with several members, and we were all surprised.”
Burr isn’t the only senator under scrutiny for suspiciously-timed stock transactions. Senators Dianne Feinstein (D-CA), Kelly Loeffler (R-GA) and James Inhofe (R-OK) also made trades in February, before markets took a dive. Like Burr, they have all denied any wrongdoing. Feinstein has said all her investments are in a blind trust and the trades in question were done by her husband. Loeffler, who is married to the head of the New York Stock Exchange, said through a spokesperson that her investment decisions are handled by multiple third-party advisors. Inhofe, whose trades were the smallest of the group – about $400,000 worth – also said he doesn’t have any involvement in making his investment decisions.
Burr’s trades have gotten the most scrutiny however, perhaps for a variety of reasons. Some of the stocks he dumped include those of the hard-hit hotel industry. Days before his trades, Burr sent mixed signals about the potential impact of the pandemic. NPR reported that he told a private donor group that the virus was “much more aggressive than anything we have seen in recent history,” and that it was “probably more akin to the 1918 pandemic.” He warned that schools may close and businesses may have to restrict travel. But on February 7, he co-authored an op-ed for Fox News that downplayed the coming pandemic and touted the government’s preparedness. Also, Burr was one of only three senators who opposed the 2012 STOCK Act, which barred lawmakers from using non-public information for trades and required their disclosure. To his credit, Burr quickly called for an investigation by the Senate Ethics Committee in March and he cited specific news sources from where he gathered the public information to inform his trades. He also filed the required financial disclosure form for the trades in question.
So, what does this mean for Burr’s political future, and for the GOP’s prospects to maintain control of the Senate? Burr announced on the campaign trail in 2016 that it would be his final run, so if he can survive the investigation, he can serve out his term as planned. Proving insider trading is difficult, and the Senate is not keen on shoving its members too far under the bus publicly – particularly likable members like Burr – so there’s a decent chance he survives this. However, the dramatic events of this week do cast some doubt on his ability to do that, and if the storm clouds over Burr’s head burst in the next few months, it could flip the Senate.
North Carolina’s other senator, Thom Tillis – also a Republican – is in a tight re-election race that is drawing dollars and eyeballs from around the country. Several other GOP Senate seats are up for grabs and the economy and coronavirus are wild cards that could break a race in one direction or another. Republicans hold a 53-47 majority and can’t afford to lose more than three seats. Senate Majority Leader Mitch McConnell (R-KY) surely had his eyes on an expanded majority going into the year.
If Burr were to resign prior to September 4, a special election would be held in November to elect a senator to complete the final two years of his term. That could be a nightmare scenario for McConnell, with the potential of losing both NC Senate seats in one night. It could also hurt President Trump’s chances of winning a state that he carried by less than four percent in 2016.
If Burr resigned on or after September 4, Governor Roy Cooper, a Democrat, would name his successor from a list provided by the state Republican Party. You can bet that there are backroom conversations occurring in the Tar Heel State about who gets on that list. Pat McCrory, Cooper’s one-term predecessor, may be at the top. The Republicans are perceived to perhaps have a deeper bench in the state. Democrats have already deployed their best Senate prospect, Cal Cunningham, in the race against Tillis. Cunningham vied for the 2010 party nomination to face off against Burr. He lost in a runoff to former North Carolina Secretary of State, Elaine Marshall, who lost to Burr. But any Democrat candidate could be seen as part of a fresh start, if he or she can team with Cunningham to take both seats.