New Treasury Secretary

President Bush did not pick my candidate. He did pick Henry Paulson:

There had been speculation in the press, including a Saturday report in the New York Times, that Paulson wasn’t interested in taking the job because of the limited role that Snow and his predecessor, Paul O’Neill, had in shaping administration policy … “I think getting Paulson is a bit of a coup for the Bush administration,” said Jeoff Hall, the chief U.S. economist for Thomson Financial. “You’ve got enough academics at the Fed right now. You need someone with a little Wall Street credibility.”

Paulson’s credibility will be destroyed if his only role is to sell the false notion that we can have permanent tax cuts without massively reducing Federal spending. I hope Paulson will have a substantive policy role and that he pushes for fiscal sanity.

Update: Just as I was posting, the President came out to introduce Mr. Paulson and to thank Dr. Snow – with the latter continuing to prostitute himself:

That surge in government receipts, along with the strict control on spending that you’ve advocated, are putting us on a path to not only meet your deficit reduction target, but to do so ahead of schedule.

Tax revenues have surged under President Bush while spending has been under strict control. That’s good to know as I’m sure glad we still have Federal surpluses!

Update II: Brad DeLong appears to be more hopeful than I am as to Paulson being able to make a difference. Rich Lowry writes:

Some people guess that Paulson taking the job might mean that the position will have more heft than it has had to this point in the Bush administration and also that there may be some significant policy proposals coming eventually. He has a reputation as a very smart guy and has been a defender of the Bush tax cuts. He should pretty quickly give Bush added credibility on the economy.

If Paulson is defending these tax cuts – then prey tell, what are those “significant policy proposals” going to be: (a) serious and specific reductions in Federal spending; or (b) a decision to default on Federal obligations? I guess “eventually” means after the November 2006 elections.

Update III: Kevin Hassett writes:

So if Snow does depart next month, I, for one, will be very sorry to see him go. When history hands down its marks for Bush administration officials, Snow will be one of the few to have deserved an A.

Talk about grade inflation!