Posted on 12/08/2002 5:38:10 PM PST by RCW2001
Sun December 8, 2002 07:17 PM ET
By Glenn Somerville
WASHINGTON (Reuters) - A new team of top Bush administration economic officials to replace dismissed Treasury Secretary Paul O'Neill and White House adviser Lawrence Lindsey will be named as early as Monday as more Treasury officials prepare to leave.
Kenneth Dam, a deputy Treasury secretary who worked closely with O'Neill in both the corporate and political worlds, also will depart soon, Republican sources said on Sunday.
Quick action to plug holes left by abrupt resignations on Friday of O'Neill and Lindsey -- at the request of the White House -- reflected determination to get a new, more supportive cast of officials in place as the Bush administration prepares a stimulus package for a stuttering economy.
Former Goldman Sachs chairman Stephen Friedman is poised to take Lindsey's job, sources said. Friedman won praise from Jon Corzine, a Democratic senator for New Jersey and himself a former chief of Goldman Sachs, who said: "I think Steve Friedman's a very capable man. He is intellectually disciplined about how he approaches problems."
But on Sunday, the name of the new Treasury chief remained tightly guarded, possibly because of the need for final security and other checks that could put a hitch in a Monday announcement.
EVANS CONSULTED
There was speculation that Don Evans, the president's friend and the current Commerce Secretary, could be picked for the Treasury's top job. He has indicated he wants it, according to Republican sources.
The shopping list includes other names such as Gerald Parsky, a California financier and lawyer; former Rep. Bill Archer of Texas, the former chairman of the House Ways and Means Committee, and discount brokerage founder Charles Schwab, among others.
Late on Sunday, administration sources indicated Parsky was unlikely to be the choice.
Evans spent at least part of the weekend with President Bush at the secluded Camp David, Maryland, retreat. Sources said final discussions were being held about economic team replacements. He flew back to Washington with Bush on the presidential helicopter.
While business lobbyists and congressional aides said Evans was a top contender, other sources said Bush was more likely to keep Evans at Commerce and shift him to the reelection campaign in 2004.
Strong ties to business and a more deft touch with the investment community were certain to be top qualifications for the new Treasury secretary. While O'Neill had an unblemished record as the chairman and chief executive of aluminum giant Alcoa Inc. from 1987 to 1999, his relationship with Wall Street was an awkward one.
With national unemployment ticking up to 6 percent in November, President Bush clearly was mindful that his reelection chances in 2004 could depend upon establishing a record of growth well before the start of that campaign.
TAX PACKAGE NEAR
Work is well under way on a package of tax cuts and other stimulative measures for presentation to a new Congress in January. The White House left little doubt it wanted a stronger sales team for the tax-cut package than O'Neill and Lindsey.
"It is fair to say that the president looks at the economy as a matter that is bigger than any one person, any one expert; and the president looks forward to working with the Congress to advance policies and plans that help with the economy growing even stronger," White House spokesman Ari Fleischer said on Friday.
Bush is mindful that his father, George H. Bush, lost his reelection bid in 1992 on a perception that he mishandled the economy and is determined not to have that happen again.
O'Neill, with a long record as a budget expert in Washington, D.C., before he launched his business career, had expressed reservations about a big new stimulus plan that could send the budget deficit soaring.
Such a development could be especially risky when the United States is running a huge shortfall on its global trade, since it would leave the country's currency vulnerable to an abrupt downturn if foreign investment flows dried up.
Democrats maneuvered for political capital from the Bush administration's actions, portraying it as an ineffectual bid to carry on with policies that were wrong in the first place.
Senate Democratic Leader Tom Daschle, interviewed on CNN's "Late Edition," said a return to budget deficits and rising jobless levels showed inept handling of the economy.
"Their trickle-down economic theories have been a miserable failure, and this is an admission of that miserable failure. ... So in addition to changing the players, they've got to change the play," Daschle said. "And I don't know that there is any evidence to suggest that they understand that today." (With additional reporting from Adam Entous)
Music to my ears.
Now they need to start DOWNSIZING government as well.
hmmm. c'mon all you gwb can **** my wife and i'm a proud american types?!?
ugh.
so, he can dump 'em.
but hasn't.
and you wonder why we decent people lose patience with you one worlder's?!?
Good. They must have read the comments here in FreeRepublic. Maybe Bush can appoint him Ambassador to Tashkent or Outer Mongolia.
Oh, go blow it out your shorts, Tiny Tom!
Is Phil Gramm being considered for any of these posts? He was an economist and college professor before he went to Congress, wasn't he?
Total lunacy....
Rumor in the press corp is that he was talked to but told Bush he did not want it. But you know how rumors go. The bush white house is pretty tight. They don't want it out. So every one is guessing.
This economy is almost exactly where it was at this point in 1982 and 1992. Unemployment continues to rise after the end of a recession for 16 months. This recession was over january a year ago. We have had about 2, 3 or 4 percent growth each quarter since. A recession is considered over when we have 2 quarters of consecutive growth. We are just completing the 4th quarter of consecutive growth.
If 82 and 92 repeat, unemployment should start to fall in May or June of 2003. Productivity in 1982 and 1992 was over 5 percent as it is today. Money was tight in 1982 but not in 1992. Money is being loosened and interest rates are low. Currently hours worked per worker are going up. But no new people are being hired. That is also normal at 11 months into a recovery. It was true in 82 and 92. It Will take another 6 months for the increased productivity to show up in profits. When profits go up, capital expenditures increase and people are called back to work.
The world is full of gloom and doomers that don't understand anything. They remember even less from one and 2 decades ago. Some might even notice that we are on a 10 year economic cycle. Business cycles have been gradually extending over the last 100 years. They are now up to 10 years. They always cry deficits coming out of the recession. It is the standard act. But a booming economy increases revenues and we will be back in surplus again.
History repeating itself confuses a lot of people. The first 10 or 20 times the business cycle happens they are confused when the results are always the same. It is like they are watching an instant replay over and over. They expect it to be different each time is is shown. But it never is.
Bush and O'Neil were in agreement on the economy. O'Neil was just not interested in using this next 6 months of public fear to enact some good tax-cuts and reduced litigation laws. Bush can blame the sluggish economy on lots of stuff and get some good legislation to "Fix it". When it recovers on its own in 2003 as it did a decade ago for Clinton, Bush and his policies can take credit.
At this time in 1992 I was still on the air. I gave a lot of publicity to the notion that Bill Clinton was going to be very very lucky president. We were going to have a great economy,and Clinton was going to get credit for it. Clinton just had the good luck to run in 2002. If Bush Sr could have run in 1994 he would have been re-elected too. Dubya bush will have the good luck to run for re-election in 2004. He will have a great economy to do it on.
Things will likey go to heck in about 2010. It may not be a good time for who ever is in office to run in 2012. He will likely face what Bush Sr. faced in 1992. The funny thing about history, it just keeps repeating itself.
I don't agree with that. Education is a crisis in this country, and we need the Fed'l gov't to set standards and enforce them.
OTOH, what use is the Commerce dep't?
You're joking, right?
Education was not in crisis until it was micromanaged, and funded from Washington. Schools performed much better, and were much more efficient, when they were funded, and controled from a local level, lets learn from history for a change.
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