Other Confirmation Hearings
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SPENCER MICHELS: Paul O’Neill, President-elect George Bush’s choice to head the Treasury Department, was greeted warmly this morning before the Senate Finance Committee. The 65-year-old O’Neill was chairman of the aluminum giant ALCOA since 1987 until recently. Before that, he was an executive at International Paper, part of that time as the company’s President. In the Ford administration, he served as deputy budget director at the Office of Management and Budget. As Treasury Secretary, O’Neill will be the point man for the Bush administration’s economic agenda, including a $1.3 trillion tax cut. Majority Leader Tom Daschle warned that a big tax cut could threaten the economy.
SEN. TOM DASCHLE: You are inheriting a remarkably strong fiscal situation. Where Bob Rubin inherited record deficits, you will inherit record surpluses. As you prepare to assume your new office, we should remember how hobbled our economy was a decades ago and how that economic weakness chipped away at America’s faith in the future and America’s influence in the world. It is important to remember how hard Americans worked to put American back on sound footing. We cannot afford to dig ourselves into a fiscal hole as we did in the 1980s. We can afford to cut taxes. We can afford to provide the opportunities for prescription drug benefits under Medicare. But we all know we must not go too far.
SPENCER MICHELS: In his opening statement, O’Neill said he’s committed to strict fiscal discipline, including a balanced budget and a strong dollar. He left no doubt that the new President would push for a tax cut right away.
PAUL O’NEILL: It would be useful for me to say– so there is no ambiguity about the President-elect’s view about tax policy and maybe as well about Social Security– he’s made it very clear to me it is his intent for us to put his tax reduction ideas into legislative form, and to send it to the Congress as quickly as we can do that. I’m not here to tell you that I can give you an exact glide path about where the economy is going to go. I would say estimates are estimates, but one has to make the decisions in the context of estimates and the estimates that I’ve looked at so far — and I’ve not had as much time as I would need or would like to examine this in the level of detail that I’m accustomed to — that there is room to fit the President-elect’s tax proposals into even the low end of economic assumptions and growth rates that I’ve looked at without touching Social Security money.
SPENCER MICHELS: Republican Senator Olympia Snowe asked if the tax cut could be postponed to see what effect the Federal Reserve’s recent 0.5% interest rate reduction, or future reductions, might have on the economy.
SEN. OLYMPIA SNOWE: What is the risk inherent in a wait-and-see attitude on our part, of if there is a delay in implementing a tax cut if we were just to determine to see if anticipating a further rate reduction, see what impact that would have on the economy?
PAUL O’NEILL: It’s not that I think that fiscal policy or rate reductions are the be all and end all, but if we’re going to do it, it’s not clear to me why we would wait six months or 12 months while we go about our normal deliberations, if there is even a suggestion that some additional… some rate reduction would be beneficial to ensuring that this is only an inventory correction and we’re sailing back into a 3% or 3.5% real growth fairly soon, because it is so fundamentally important to everything else.
SPENCER MICHELS: O’Neill is likely to be confirmed in a special Senate session following the inauguration on Saturday. New Jersey Governor Christie Todd Whitman also got a warm welcome at her hearing before the Senate Environment and Public Works Committee. The 54-year-old Whitman became New Jersey’s first female governor in 1994 and has one year left in her second term. She also served as President of New Jersey’s Board of Public Utilities. Democratic Senator Robert Torricelli introduced his state’s Governor to the committee saying she was a wise selection.
SEN. ROBERT TORRICELLI: The EPA and the country will be getting an administrator who is qualified, tested, and ready to tackle the challenges that lie ahead for this agency. With this nominee there will be absolutely no learning curve. There are few training grounds that could better prepare someone for this position than the governorship of New Jersey.
SPENCER MICHELS: Whitman promised the Committee that if confirmed, she’d protect the nation’s natural resources.
CHRISTINE TODD WHITMAN: As President-elect Bush has emphasized, and as New Jersey has seen, environmental protection and economic prosperity do and can go hand in hand. Mr. Chairman, one of the first things that my father taught me was, Christie, always leave any place cleaner than when you found it. He didn’t know at that time, but that was awfully good advice for someone who would someday be nominated to serve as the head of our nation’s agency for environmental protection. I pledge to you, Mr. Chairman, and to the members of this committee that, if confirmed, I will do everything that I can as EPA Administrator to leave America’s environment cleaner then when I found it.
SPENCER MICHELS: New York’s junior Senator, First Lady Hillary Clinton, questioned Whitman about clean water, an issue especially important to her constituents on Long Island.
SEN. HILLARY RODHAM CLINTON: And, finally, I just wanted to ask about the right to know. I think it is important that we build on the consumer right to know provisions of the Safe Drinking Water Act of 1996 by providing consumers with information more quickly about the quality of their drinking water, and I intend to propose legislation that will build on that. This will be particularly important in areas such as Long Island where we depend on an aquifer system and we need to have accurate timely information to promote consumer confidence and also to make knowledgeable decisions about the environment and I would like forward to working with you and your staff at the EPA in coming up with legislation if you would be interested in pursuing that.
CHRISTINE TODD WHITMAN: I will be happy to work with you on those issues.
SEN. HILLARY RODHAM CLINTON: Thank you.
SPENCER MICHELS: Republican James Inhofe asked about the agency’s relationship with industry. Inhofe described a story about a constituent who said his company was put out of business by the EPA
SEN. JAMES INHOE: The instilling of fear and intimidation in these people, I am hoping that this will be something you’ll jump on right away and stop and give them the proper recognition that they are in fact the ones that are generating and running this ship that we call our economy.
CHRISTINE TODD WHITMAN: Instilling fear does not solve problems, generally. It is important to have the stick. It will always be there. But by going in first and talking the problem through with them, we have found that in fact they can be very creative in how they solve that problem, and they can do so in a way that will allow them to maintain their economic viability and competitiveness. And that really is an approach that we need to have.
SPENCER MICHELS: Whitman should win Senate approval next week.