WASHINGTON -- President Bush moved on two fronts yesterday to demonstrate his concern about the flagging economy -- nominating John W. Snow, chairman of railway conglomerate CSX Corp., as his Treasury secretary and promising a new package of tax breaks and other incentives to spur more vigorous business activity.
"John Snow has excelled as a business leader, an expert on economic policy, an academic, and as a public servant. He'll be a superb member of my Cabinet," Bush said at a brief White House ceremony. "I'll be proposing specific steps to increase the momentum of our economic recovery. And the Treasury secretary will be at the center of this effort."
If confirmed by the Senate, Snow will replace outspoken Treasury chief Paul O'Neill, who, along with White House economic adviser Lawrence Lindsey was abruptly forced to resign Friday. Bush and other administration officials had lost confidence in the duo's ability to sell the White House tax-cutting agenda to the financial community and to Congress; a crucial task as the White House prepares for the 2004 election.
Concerned at the slow pace of the economic recovery, administration officials have been pulling together a plan for hundreds of billions in new tax breaks for investors, businesses, and consumers. Possibilities include proposals to address the double taxation of stock dividends, expand business tax breaks for purchasing new buildings and equipment, and moving up some personal income tax cuts already scheduled to take effect in future years under Bush's $1.6 trillion tax cut law.
Snow, 63, is in a good position to sell that plan, given his close ties to the Bush administration, business leaders, and Federal Reserve Board chairman Alan Greenspan. An attorney who holds a doctorate in economics, he was deputy undersecretary of transportation during the Ford administration and has served as chairman of the Business Roundtable, an influential group of chief executives of the nation's top companies.
Snow has been chief executive and chairman of Richmond-based CSX Corp. since 1989. The firm, which runs one of the largest rail networks in the eastern half of the United States, and other transportation-related services, has been a major source of campaign donations to the Republican Party. Snow has been an advocate of more rigorous financial reporting for executives.
"This is an important moment for the economy," Snow told Bush at the White House. "Thanks to your leadership, and this administration's stewardship of the economy during a tough time, the recession was one of the shortest and shallowest in modern economic history. Yet I strongly share your view that we cannot be satisfied until everyone -- every single person who is unemployed and seeking a job has an opportunity to work."
The White House attempted to quickly quash one potential source of controversy, announcing Snow planned to resign his membership in the males-only Augusta National Golf Club. Women's groups have been pressing for Augusta, host of the prestigious Master's tournament, to expand its membership.
Bush was said to be close to naming Stephen Friedman, a former co-chairman of Goldman, Sachs & Co., to replace Lindsey, business sources said. But conservatives were upset about the choice. In a newspaper column that will run today, former Republican vice presidential candidate Jack Kemp said he was concerned that Friedman was a "deficit hawk" who might not strongly push the White House's aggressive tax policies. Others complained that Friedman had provided campaign contributions to Democrats, including New York Senator Charles Schumer.
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