Smooth Sailing For Paulson
Treasury Secretary-designate Henry Paulson promised Tuesday to improve America's global competitiveness, in part by ensuring that companies are treated fairly in trade matters and by keeping taxes down.
"If confirmed, I will focus intensely on how the United States can maintain and strengthen our competitive position," Paulson, a 32-year Wall Street veteran, said during his Senate Finance Committee confirmation hearing. Paulson's nomination is not expected to hit any major roadblocks.
The panel's chairman, Sen. Chuck Grassley, R-Iowa, has said he hoped the nomination would be approved by the full Senate by the start of the July 4 congressional recess.
If approved as expected, the 60-year-old chairman-chief executive officer of Goldman Sachs would become Mr. Bush's third Treasury secretary since the president took office in January 2001.
Paulson said that as treasury secretary he would be active in affirming the country's leadership role in the global economy, where the United States must be a "constructive and stabilizing force."
To help make the United States more competitive on the global playing field, Paulson said he would work to advocate policies that provide open and level markets for U.S. investment and for U.S. products.
Paulson outlined other steps that could be taken to energize the country's competitive stance. He said those steps include:
Mr. Bush selected Paulson to succeed John Snow, the former chief of CSX Corp., the big railroad company. Snow has run Treasury since February 2003. Beset by low job approval ratings, Mr. Bush is looking to Paulson to help energize the administration's stalled second-term economic agenda. The nomination was part of a flurry of other changes in the president's personnel lineup.
Sen. Chuck Schumer, D-N.Y., introduced Paulson to the panel, calling him a "straight shooter" and asked that the Senate confirm him promptly. Paulson praised his wife, Wendy, who sat behind him.
Grassley said that his panel, which has pored over hundreds of pages of documents on Paulson's nomination, "found his financial affairs and connection to hot-button issues such as the Richard Grasso compensation package at the New York Stock Exchange and Goldman Sach's tax work either appropriate or non-applicable to the nomination."
Paulson was a member of the NYSE board of directors that had approved Grasso's pay package. Grasso eventually resigned as chief of the NYSE amid intense criticism over his $187.5 million pay package.
A millionaire many times over, Paulson earned $35.06 million in salary from Goldman Sachs last year, an amount that included cash and stock options.
Paulson will sell his holdings in the Wall Street firm to comply with government conflict-of-interest rules, the White House said last week. He owns 3.23 million shares of stock, worth more than $470 million. His total net worth is estimated to be above $700 million.
As the president's top economic salesman, Paulson would take over the Treasury helm at a challenging time for the economy with growth slowing and inflation rising. Big budget and trade deficits pose risks for the economy. Trade tensions are running high with China. And, there's some anxiety over whether the value of the U.S. dollar will gradually and smoothly decline or whether there might be a dangerously jarring and steep descent.
Democrats and Republicans on the Senate committee have welcomed Paulson's nomination, citing his strong credentials for the job.
"He's a good candidate for treasury secretary based on our review," Grassley said.
Grassley said he looked forward to Paulson's views on a wide range of matters from combating illegal tax shelters to fighting terrorist financiers.
Recent disclosure of a program used by the department to track activity by suspect terrorist financiers has stirred some controversy among privacy advocates and some Democrats. The program – defended vigorously by the administration — allowed the government, upon subpoena, to gain access to an international data base containing information on millions of financial transactions.