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Bush, George W.

Speculation Surrounds John Snow's Departure as US Treasury Secretary

Strategic Insights

— 1 min read

As the US Treasury under John Snow faces renewed scrutiny, speculation mounts about when and who will succeed him in the post. President George W. Bush has an ambitious economic agenda for his second term, including Social Security and tax reform, which requires a new economic team to push through the policies before congressional attention turns to the 2008 elections. Recent White House indications suggest John Snow may leave the post earlier than initially anticipated.

Key Takeaways:

  • The White House is looking to replace John Snow as US Treasury Secretary, with possible candidates including Andrew Card, White House chief of staff, and Josh Bolten, director of the Office of Management and Budget.
  • Glenn Hubbard, former chairman of the White House Council of Economic Advisers, is close to President Bush and may be considered for the role.
  • Promoting a White House lieutenant, such as Andrew Card, could ease internal politics within the administration but may not raise confidence on Wall Street and among international investors.
  • A Wall Street figure, like Stan O'Neal, chairman of Merrill Lynch, or Hank Paulson, chairman of Goldman Sachs, could also be considered for the role but would face challenges in building credibility with investors and outsiders.
  • Phil Gramm's name has been floated by congressional Republicans, but his reputation for being difficult to work with and his wife's Enron connection may be a concern.
  • The White House does not seem to value an independent-minded Treasury secretary, as evidenced by the treatment of Paul O'Neill during his tenure.

Statistics:

  • The transition costs of Mr. Bush's Social Security reform plan are estimated to run into the thousands of billions of dollars in the first decade alone.
  • The bond market has been relatively quiescent despite concerns from the foreign exchange market.

Sources:

  • Andrew Balls, "Country Briefing from Financial Times," Financial Times, date not given.
  • Robert Rubin's experience as a successful Treasury secretary in the Clinton administration.
  • Nariman Behravesh, chief economist at Global Insight, the economics consultancy.
  • Andrew Card's background as White House chief of staff, former congressman, and business lobbyist.
  • Phil Gramm's reputation as a difficult person to work with and his wife's Enron connection.

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