Bush Taps Rep. Cox For SEC Post

President Bush on Thursday named conservative Rep. Christopher Cox to lead the Securities and Exchange Commission. Cox would succeed William Donaldson, who announced the day before he was stepping down after 28 months on the job.

With Cox at his side at a White House ceremony, Mr. Bush called the lawmaker "a champion of the free enterprise system in Congress. ... He'll be an outstanding leader of the SEC."

Cox, 52, a member of the House Republican leadership, has a wide-ranging background, from foreign policy and economic issues to homeland security. He has represented California in Congress for 16 years.

Mr. Bush also had kind words for Donaldson, a former Wall Street official whom the president picked to restore investor confidence after a wave of corporate scandals. Donaldson "has done an exceptional job," Mr. Bush said, noting that he "took this post as our economy was faced with a crisis in investment."

Mr. Bush said Cox is "the right man to carry on this job."

Donaldson's aggressive regulation antagonized some business leaders and their allies in the administration and on Capitol Hill.

Still, Mr. Bush said that Cox would continue to press for forceful regulation.

"I've given Chris a clear mission: to continue to strengthen the public trust in our markets so the American economy can continue to grow and create jobs," he said.

He called on the Senate to confirm Cox "at the earliest possible moment."

For his part, Cox said he was "deeply honored" by the president's faith in him.

The laws enforced by the SEC have given the United States "the most dynamic and vibrant capital markets in the world," Cox said. He vowed to stand up for "clear and consistently enforced rules" if confirmed by the Senate.

Cox, who most recently served as the chairman of the Homeland Security Committee in the House, appeared in the Roosevelt Room ceremony with his wife, Rebecca, and two sons and a daughter.The Senate confirmation process has left Cox bruised once before. He was in line for an appointment to the U.S. Court of Appeals in 2001 when Democrats suddenly gained control of the Senate.

Facing opposition from at least one of his home state's two Democratic senators, Cox realized he faced a difficult fight to win confirmation to the bench without a guarantee of success. He withdrew his name.

In announcing his resignation on Wednesday, Donaldson cited family reasons and denied he was stepping down because of disagreements with Republicans over commission decisions. He had sided with the two Democrats on the five-member panel on rules in such areas as stock market trading, hedge funds and mutual funds.

Donaldson, just shy of his 74th birthday, said he hoped "there will be no legalistic rollback of any of these key items." He predicted the next chairman "will leave politics at the door."

In a letter to Mr. Bush, Donaldson cited the tireless work of SEC employees and said the past 2½ years "may well be remembered as the most consequential and productive period in the commission's history."

Mr. Bush turned to Donaldson, a Republican and family friend, in 2003 to replace the embattled Harvey Pitt, whom administration officials forced out after a series of political missteps.

Donaldson helped implement the Sarbanes-Oxley Act. He also won approval at the SEC for a number of rules designed to clean up the $7 trillion mutual fund industry.

Donaldson last month won SEC approval for a plan to overhaul stock trading. He joined with the Democrats on the commission as the two Republican commissioners objected to the new rules.

Under the proposal, known as the "trade-through" rule, stock brokers will be required to accept the best quoted price for any transaction, no matter which market it came from.

The rule is not due to take effect until 2006, leaving the agency free to review it under a new chairman.

In addition to Donaldson, the White House likely will have two additional vacancies to fill on the commission.

The term of one Democratic commissioner, Roel A. Campos, expires this year. Democrat Harvey Goldschmid has made it known that he intends to return to teaching at Columbia University this fall.

By law, no party may control more than three seats on the five-member panel.

Senate Democrats have suggested that the president nominate the SEC's market director, Annette Nazareth, to fill Goldschmid's slot.