Shake-Up at the Treasury

The economy is faltering, the stock market is down and people are out of work. Those in charge of the economy had to go, and most of them did.

Over the past few days President Bush has sacked the vast majority of his economic team, including Treasury Secretary Paul H. O’Neill and chief economic policy adviser Lawrence B. Lindsey. Though this should have been an opportunity to bring in new ideas that could help jump-start the economy, Bush has instead appointed more big-business cronies who will act as a mouthpiece for the same old tax-cutting nonsense that has been spewing from the White House since Bush took office.

John W. Snow at Treasury is one of the blasts from the past. Former chief executive officer of CSX Corporation, a large railway and shipping company based in Richmond, Va., Snow first joined the government in the Ford administration. Although as a business leader he has stressed the importance of balancing the budget, he has recently begun to tow Bush’s policy line and has almost magically become an outspoken advocate of slashing taxes for corporations and individuals, even if that means running short-term deficits.

The newly-appointed chair of the Securities and Exchange Commission, William H. Donaldson, seems to redefine the term “old boy.” He is a close friend of both Bush’s father and uncle, whom he met as an undergraduate at Yale, and like Bush was a member of the Skull and Bones secret society. He was given his first job on Wall Street by Bush’s great uncle, Herbert Walker, and served in the State Department in both the Nixon and Ford administrations.

The only new appointee who seems to hold any promise is Stephen Friedman, who is to become Bush’s top economic adviser. Although at first glance he may seem like another investment banker, having co-chaired Goldman Sachs in the early 1990s, Friedman does advocate hard-line fiscal discipline and thus will hopefully oppose some of the more aggressive tax cuts that Bush is proposing. On the other hand, this policy leaves little room for proactive social spending that is needed in a weak economy.

The administration’s current policies have done little to help the economy. Instead of importing new faces for the same old ideas, Bush should reassess his single-minded commitment to tax cuts for the wealthy.

Dissent: Bush’s Fiscal Policy Sound

The Staff, in its stubborn opposition to tax cuts, again identifies itself as an enemy of middle-class Americans, who have seen sizeable tax relief under the Bush administration. While criticizing Bush for plunging the U.S. into recession, a recession that analysts now say began a mere two months after Bush took office, they decry at the same time Bush’s fiscal policy initiatives toward economic recovery.

Adopting the Staff’s dismal view, Bush and his evil Republican cohorts will always be the scapegoats for every social ill plaguing our economy. We should all be skeptical of dogma that calls for taxing Americans into oblivion and destroying every last shred of personal responsibility for one’s own welfare.

-Luke Smith ’04