WASHINGTON (AP) – President Bush turned to railroad executive John Snow to be his new Treasury secretary yesterday and signaled his determination to push ahead with a new round of tax cuts to jump-start the sluggish economy.
Three days after shaking up his economic team by firing Treasury Secretary Paul O’Neill and Lawrence Lindsey, the head of his National Economic Council, Bush announced he would nominate Snow, the president of Richmond-based CSX Corp., one of the nation’s largest railroad freight lines, as O’Neill’s successor at Treasury.
In many ways, Snow, 63, has a resume similar to O’Neill’s. Both men served in the Ford administration where they worked with Dick Cheney and then both left the government to pursue business careers.
However, O’Neill, the former head of Alcoa Corp., proved to be a gaffe-prone economic spokesman for Bush, infuriating Republicans in Congress and roiling financial markets with his comments. Snow is seen as a more cautious public speaker and a politically savvy operator who will be better able to sell the Bush program in Congress and on Wall Street.
“I look forward to joining your economic team to advance a pro-growth, pro-jobs agenda,” said Snow, who holds a Ph.D. in economics from the University of Virginia and has been an active participant in public policy debates in Washington, at one time as chairman of the influential Business Roundtable.
Determined not to repeat his father’s mistake of appearing to be insensitive to rising joblessness during economic hard times, Bush told reporters that he would soon be proposing “specific steps to increase the momentum of our economic recovery and the Treasury secretary will be at the center of this effort.”
Bush pledged to provide more tax relief, saying “many Americans have very little money left over after taxes.” He also said he wanted to put forward proposals to bolster investor confidence, which has been shaken by the loss of trillions of dollars in stock market wealth, and to help Americans save for retirement.
Congressional and business lobbyists who have been briefed by administration officials said yesterday that Bush was considering a package of tax cuts and spending measures that would cost between $250 billion and $300 billion over 10 years.
These officials, who spoke on condition of anonymity, said that the major tax cuts the administration was considering were accelerating the personal tax rate reductions scheduled to take effect in 2004 and 2006, lowering the tax on corporate stock dividends, long a Republican goal, and boosting tax breaks to encourage businesses to invest in new plants and equipment.
Some congressional sources said that the administration might be willing to consider proposals such as cutting the Social Security payroll tax or extending unemployment benefits as a way to attract Democratic votes for the package.
Snow, who spent part of yesterday making telephone calls to key lawmakers, was expected to encounter questioning during his Senate nomination hearing about government support for CSX.