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‘Weaponized’ agency: Ramaswamy, Musk attack SEC after diversity ruling setback

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Vivek Ramaswamy and Elon Musk are joining other Trump allies in slamming the Securities and Exchange Commission after a federal appeals court threw out the regulator’s approval of board diversity rules from the Nasdaq exchange.

Less than 24 hours after the New Orleans-based Fifth Circuit Court of Appeals decided in favor of conservative groups that had challenged the rules, Ramaswamy, Musk and Sen. Mike Lee of Utah said the decision underscored what they see as underlying issues with Wall Street’s top regulator.

“When an agency like the SEC is so repeatedly & thoroughly embarrassed in federal court for flouting the law, it loses its legitimacy as a law enforcement body,” said Ramaswamy, who is heading up the so-called Department of Government Efficiency alongside Musk, in a post on X.

Musk called the SEC “just another weaponized institution doing political dirty work” in a post of his own, while Lee said the SEC “cannot be trusted.”

The attacks could offer a preview of the potential scrutiny that awaits the SEC in the incoming administration, as President-elect Donald Trump and his team look to overhaul the federal government and slash spending. Leading that charge from the outside will be Ramaswamy and Musk’s DOGE, an advisory panel that is expected to look at everything from cutting regulations to forcing the federal workforce back to the office.

The SEC has long been a popular target for conservative groups, lawmakers and business titans, including Musk. The billionaire owner of X, Tesla chief executive and Trump’s highest-profile backer has repeatedly clashed with the agency in recent years, including during the first Trump administration. Most recently, the SEC has been investigating Musk’s $44 billion purchase of X, which was then called Twitter.

An SEC spokesperson did not immediately respond to a request for comment about the posts by Ramaswamy, Musk or Lee.

The Nasdaq rules were designed to require companies listed on the exchange to publicly disclose data about their board members and to have at least two members who identify as having diverse backgrounds — or for the company to explain why they don’t have those individuals in place.

But the Fifth Circuit found that the proposals “cannot be squared” with federal securities laws and that the SEC had “intruded into territory outside its ordinary domain” by approving them.

The decision, handed down more than three years after the SEC’s approval order, was the latest in a string of legal defeats for the Gary Gensler-led SEC.

Financial industry and conservative groups have launched a wide-ranging effort in recent years to knock down critical SEC rules in the courts — and particularly in the conservative-majority Fifth Circuit. An SEC spokesperson said late Wednesday that the agency is reviewing the Nasdaq ruling.

How the SEC handles the legal challenges going forward could fall on the shoulders of Trump’s pick to lead the agency, Paul Atkins. Earlier this month, the president-elect tapped the former SEC commissioner and Wall Street adviser to replace Gensler next year. If confirmed, Atkins is widely expected to pursue a business-friendly agenda that could entail walking back certain rules and lawsuits pursued by Gensler’s SEC.

Dennis Kelleher, who leads the financial reform advocacy group Better Markets, told Blue Light News that the federal court ruling had little to do with the SEC or the merits of Nasdaq’s rules. Instead, he said, “it is about a biased kangaroo court weaponized with Trump-appointed judges who reflexively side with the industry against government rules regardless of facts, law or policy.”

“The goal of the industry is to turn the SEC from an effective cop on the Wall Street beat to a toothless tiger that does not do its job and cannot do its job,” Kelleher said. But, he warned, “undermining and crippling the SEC is undermining the United States capital markets, which is the jet fuel for our economy.”

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Congress

Capitol agenda: House hard-liner headaches ahead

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House Republicans are heading into a chaotic two-week sprint to try and make real legislative headway before a subsequent two-week recess — and prove that their narrow and deeply fractious majority can still get something done.

Hard-liners are already signaling this exercise won’t be easy. Here are the revolts to watch in the next two weeks:

— First, there’s FISA: Republican leaders want to pass a straightforward extension of Section 702 of the Foreign Intelligence Surveillance Act, or FISA, next week, to give the Senate enough time to reauthorize the key spy authority before the April 20 deadline. The White House supports this path forward.

But conservatives want to add additional privacy guardrails to the existing law that allows the government to collect the data of noncitizens without a warrant.

Speaker Mike Johnson can only afford to lose one Republican on party-line procedural votes without grinding floor operations to a halt. At least two of his members, Reps. Anna Paulina Luna of Florida and Keith Self of Texas, aren’t ruling out opposing a “clean” FISA bill.

“We’ve got several must-pass bills, all of which need amending,” Self told Blue Light News. “And FISA is one of them.”

— Housing challenges: Hard-liners are also posing problems for the GOP’s ability to respond to voter concerns about higher costs of living as the midterms approach. Many are refusing to advance a Senate-passed affordable housing package because it doesn’t contain key policies they fought for on their side of the Capitol, such as a permanent ban on a central bank digital currency.

Now these holdouts want a bicameral conference to negotiate changes and strip out “socialist” provisions secured by Sen. Elizabeth Warren (D-Mass.) — an unrealistic demand that would serve as a de facto death knell for the entire effort.

“I don’t have anything to add to what’s been discussed already,” House Financial Services Chair French Hill (R-Ark.) told Blue Light News on Monday when asked about the status of talks.

— The “SAVE” revolt: Hanging over all these quagmires are threats from some hard-line Republicans to oppose any Senate-passed bill, for any reason, until the Senate passes the SAVE America Act — the GOP’s partisan elections package that stands little chance of becoming law (more on this below).

“I don’t care what the bill is,” Luna told Blue Light News. “If they can’t do their job, they can’t pass bills.”

She plans to start her blockade Tuesday by voting against a Senate-backed measure on the House floor that would extend the Small Business Innovation Research program.

What else we’re watching: 

— “SAVE” debate begins: The Senate is set Tuesday to launch a dayslong debate over the SAVE America Act, which President Donald Trump calls his “No. 1 priority.” But don’t expect a “talking filibuster” that some conservatives hope would force Democrats to relent to a simple majority final passage despite their unified opposition. Instead, Republicans will start with a vote to begin consideration of the House-passed bill that would institute new citizenship and photo ID requirements in order to participate in elections.

— Friends of Ireland on Blue Light News: The speaker will host Trump and Taoiseach Micheál Martin for the annual Friends of Ireland luncheon at noon.

— AIPAC on the ballot: Tuesday’s primary elections in Illinois will serve as a critical test of whether the historically powerful American Israel Public Affairs Committee still has clout.

Jordain Carney, Meredith Lee Hill, Elena Schneider and Shia Kapos contributed to this report.

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Senate GOP ready to move on elections bill

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Senate Majority Whip John Barrasso told reporters Monday the chamber will vote Tuesday to take up a House-passed elections bill known as the SAVE America Act.

The Wyoming Republican, whose job it is to help round up support, said he is “doing everything I can to make sure we get on this bill tomorrow.”

Republicans will need a simple majority to begin debate on the partisan legislation; they can lose three members and still let Vice President JD Vance break a tie.

So far, Sen. Thom Tillis (R-N.C.) has said he’s a “no,” while Republicans are also watching GOP Sens. Lisa Murkowski of Alaska and Mitch McConnell of Kentucky.

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Jesse Jackson’s family withdraws posthumous endorsement in Illinois Senate primary

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The family of the late Rev. Jesse Jackson walked back a posthumous endorsement of Illinois Lt. Gov. Juliana Stratton’s Senate campaign on Monday, after the family said Jackson’s endorsements for Tuesday’s primaries were not completed before his death.

On Saturday, Stratton’s campaign touted an endorsement from Jackson, who died last month, and his son Yusef. The announcement came after Stratton saw Rainbow PUSH Coalition, the Jackson family’s organziation, passing out sample ballots — which were also obtained by Blue Light News — that recommended Stratton.

“[Jackson’s] example has been a north star for me, and I’m deeply honored to have received his trust, support, and endorsement before his passing,” Stratton said in a statement on Saturday.

But on Monday, Yusef Jackson, who is the organization’s COO, said the draft sample ballot was “released without authorization” and that the Jackson family and Rainbow PUSH Coalition are not making political endorsements this cycle.

His father “began the process of reviewing candidates and identifying those he intended to support in the upcoming primary election,” Yusef Jackson said in the statement. “However, given his passing just over a month ago, the process was never fully completed. Out of respect for my father, we decided not to publicly release his intended selections given the process had not been finalized.”

The Stratton campaign said on Monday that officials with Rainbow PUSH Coalition said she had been endorsed by Jackson.

“Juliana spoke on Saturday at Rainbow PUSH for a Women’s History Month event and officials told her she received the endorsements. Organizers shared the sample election ballot that was already being distributed and encouraged her to share the news,” the Stratton campaign said in a statement.

The endorsement mix-up draws further scrutiny on the split among Black Democrats in Illinois between Stratton and Rep. Robin Kelly (D-Ill.), who are both seeking to succeed retiring Sen. Dick Durbin. Some Democrats in the state have expressed concern that Stratton and Kelly could split the vote in Tuesday’s primary, creating a path for Rep. Raja Krishnamoorthi (D-Ill.) to win the nomination.

Rep. Jonathan Jackson (D-Ill.) told Blue Light News prior to the family’s statement that his father “never got in on Black-on-Black fights.”

Jonathan Jackson added that the races the late Jesse Jackson “was excited about” were himself and former Rep. Jesse Jackson Jr.’s comeback bid.

“He wouldn’t do that. He was always pushing the community forward,” Jackson said. “This smells of desperation.”

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