Despite written warnings from all but three members of the Senate Agriculture Committee not to send the nomination to Congress, the White House is going ahead with plans to name Hugh Cadden to the Commodity Futures Trading Commission.
Cadden, 36, now special assistant to CFTC Chairman James Stone, is "extremely well qualified" to be a CFTC commissioner and will be nominated for the post, a White House personnel official said yesterday.
Fifteen of the 18 members of the Senate Agriculture committee signed a letter Monday urging President Carter not to nominate Cadden to the $52,000-a-year vacancy on the commission.
Carter told influential congressional committee leaders last week he planned to name Cadden to the post, which has been vacant for several months.
There was speculation at the time that Carter might be floating a trial balloon by revealing his plans in advance.
"The White House would have to be crazy to nominate Cadden now," said one source at the Senate Agriculture Committee, which must approve the nomination.
But the White House officials refused to back down, insisting that Cadden is a veteran commodity regulator, highly regarded within the CFTC, who has all the qualifications for the job.
Cadden, who was the CFTC's director of trading and markets before becoming Stone's top aide, was given the CFTC's award as the agency's top employe earlier this year, supporters of his nomination pointed out.
They said Cadden is also politically qualified to fill a Republican vacancy on the CFTC because he was brought into the agency as a protege of Republican Chairman William Bagley and promoted to a department head's job by Republican Gary Seevers.
Cadden's political credentials and his endorsement for the commissioner's job by CFTC Chairman Stone were the main objections raised by the senators who urged Carter not to proceed with the nomination.
"There's nothing in that letter that indicates he is not qualified for the job," insisted a Carter administration official involved in the choice.
The Carter administration's willingness to fight for Cadden is surprising in light of the warning signal sent Monday by the Agriculture Committee.
All but three members of the committee signed a letter to the president stating flatly, "We cannot support the nomination of Mr. Hugh Cadden inasmuch as his appointment is contrary to what we believe is in the best interest of the CFTC." The senators said they "respectfully request that you not forward the nomination of Mr. Cadden for this position."
Quiet consultations between the White House and the Senate in advance of regulatory appointments are common, but the effort by senators to block a nomination before it has been officially made is unique.
Cadden apparently was selected after CFTC Chairman Stone personally interviewed half a dozen potential nominees picked by the White House and then decided that Cadden was the best of the bunch.
Stone apparently was not given a free hand in deciding who should fill the CFTC vacancy, but was given a chance to review the candidates and pass his preference on to the White House.
Rarely are the chairmen of regulatory agencies given so much influence over the selection of their fellow commissioners, who are supposed to be independent policy makers.
Since he took over the CFTC last spring, Stone has said he needed "a third vote" from a commissioner who could be counted on to back him on crucial issues.
Stone's inability to control the five-member commission was made clear this month when the CFTC unexpectedly killed a plan to expand commodity options trading after spending months on the project.
Stone insisted that strong new consumer protection rules be part of the options regulations, but only Commissioner David Gartner voted with him on that issue. The options expansion died on a two-two vote, and Stone said he wouldn't bring up the issue for another year, or until there was reason to believe the outcome of the vote might be different. Cadden would have made the difference.
But Cadden's potential loyalty to Stone apparently was what killed his nomination in the agriculture committee.
"We believe that your nominee should be expected to exercise independent judgment, which precludes, in our view, any nominee who is closely associated with the commission or any member of the commission," said the letter sent to Carter by the 15 committee members.
Republican committee members were said to be particularly incensed about Stone's influence in the nomination because Cadden is filling a vacancy that by law must go to a Republican or an independent. No political party is permitted to hold more than three of the five CFTC commissionerships.