People of the Week: Bush's Tax-Cut Gang

  • Share
  • Read Later

John Snow joins Bush's new economic team

At last the Bush economic trifecta is complete. John Snow, William Donaldson and Stephen Friedman will now settle into their new jobs, with their first assignment clear: Put out the Administration's tax cut message. The White House wants to make permanent its 2001 tax break, which totaled just over $1.3 trillion. So rather than expire in 2010, as it is currently scheduled to do, the tax cut will live on into perpetuity — or at least until another administration comes in and orders its reversal.

Snow, Donaldson and Friedman are being prepped to tell the American public two things: 1. Tax cuts will jump-start the nation's sluggish economy. And 2. Said tax cut is worth it, even if it happens to drag us into a deficit. Both these messages need to sanded, finished and lacquered for public consumption by the middle of January, when President Bush will deliver his State of the Union address — the domestic cornerstone of which is expected to be economic revitalization. And so, as the new keys to the Bush economic message, Snow, Donaldson and Friedman are our People of the Week.

Will the three deliver believable sound bites? If they don't, they risk a similar fate to that of Paul O'Neill and Larry Lindsay, neither of whom proved capable of selling tax cuts to a wary Capitol Hill. Both men were asked to leave the administration last week in a bout of epic housecleaning.

John Snow, Bush's nominee for Treasury Secretary and chair of railroad freight company CSX, is expected to toe the line on tax cuts. That's not to say he doesn't make some supply-siders nervous; fiscal conservatives reportedly fear he may not believe fiercely enough in the tax-cut gospel Bush will ask him to spread. Further complicating matters, Snow, who is known for his distaste for deficits will have to make the case that a national debt isn't so bad after all. Still, the White House is reportedly delighted with Snow.

At the Securities and Exchange Commission, investment banker William Donaldson will be asked to handle the tax cut question for the investment community, and given his past experience — he was the chair of the New York Stock Exchange in the early 1990s — he should have no trouble doing so. President Bush hopes that the Wall Street insider will provide corporate chiefs and investors alike with a much-needed boost of confidence. He takes over for departing head Harvey Pitt, who left last month amid a flurry of blame over bad press and lukewarm economic news.

Then there's Stephen Friedman, the former head of Goldman Sachs. Widely considered a shoo-in to replace Lindsay, his appointment hit a snag this week while the White House worked through a slew of undisclosed "personal and professional issues." When President Bush formally named Friedman to replace Lindsay Thursday afternoon, it was only after days of speculation that Friedman's reputation for deficit phobia — he served as a director of the Concord Coalition, a bipartisan group whose members oppose federal budget deficits — might have caught up with him. The White House maintained throughout the delay that they were only following protocol, and that the President never wavered in his support for Friedman.