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Treasury secretary ruffles many feathers, but not Bush's

O'Neill speaks his mind

Posted: Monday, August 27, 2001

WASHINGTON -- If the on-message Bush White House had an etiquette manual for Cabinet members, ''openly speaking your mind'' would surely not be among its recommendations. Treasury Secretary Paul O'Neill may take heart that there is no such book of behavior.

The direct-speaking former Alcoa Aluminum chief from Pittsburgh is also helped by the fact that his boss, President Bush, seems to delight in O'Neill's salty, spontaneous observations -- even if they sometimes make others wince.

After all, Bush has gotten the same reaction to some of his own spontaneous utterances.

Detractors who expected O'Neill to be the first Cabinet member out the door could have a long wait. After a rocky start, administration insiders say he has clearly become a team player.

O'Neill, 65, has called the U.S. income tax code ''9,500 pages of gibberish.'' He has rattled currency markets with mixed comments on the dollar and roiled the Social Security debate by declaring that the able-bodied should save for their own retirement and medical care.

He has criticized international bailouts of Russia as ''crazy'' and called the European Union ''off the wall'' for rejecting the General Electric-Honeywell merger.

His take on nuclear accidents: ''If you set aside Three Mile Island and Chernobyl, the safety record of nuclear is really very good.''

Administration critics worry that O'Neill's loose tongue will unsettle financial markets at a time when economies are fragile around the world.

O'Neill also has tilted against administration dogma -- initially questioning the short-term benefits of the Bush tax cut and advocating an aggressive battle to combat global warming.

His outspokenness sets him apart from other top administration officials, who generally refrain from talking about subjects beyond their jurisdiction and stick closely to the White House script.

But administration officials say that Bush has a special affinity for his fellow former businessman.

''The president enjoys his blunt, plainspoken approach,'' said Bush press secretary Ari Fleischer. Despite the controversies that continue to swirl around O'Neill, ''The president has never had a moment of concern.''

''Paul O'Neill is cut from a different cloth. He is a straight talker. He's a businessman,'' Fleischer added.

Fleischer said that at one Cabinet meeting in the spring, Bush gave O'Neill the floor to share his insights into ''how to treat the work force well, how to raise expectations. ... The president was impressed.''

O'Neill has other backers in high places: Vice President Dick Cheney and Federal Reserve Chairman Alan Greenspan.

The three all served in the Ford administration; Cheney as chief of staff, Greenspan as economic adviser and O'Neill as a White House budget expert.

O'Neill left the government in 1977 and spent the intervening years in the private sector, the last decade as Alcoa's chief executive officer.

His early resistance to selling some $100 million in Alcoa stock drew criticism from Democrats and public interest groups. The former CEO riled Wall Street with his comments that market traders are ''not the sort of people you would want to help you think about complex questions.''

With a disdain for small talk, O'Neill has voiced open impatience with questions from members of Congress, drawing a stern lecture from Sen. Robert Byrd, D-W.Va., on courtesy.

But for all his misguided verbal missiles, he has been a Bush loyalist in all the important matters, administration officials say.

Despite his early skepticism that the Bush tax cut would stimulate the sluggish economy, he worked hard to help win its speedy passage.

After long criticizing international bailouts, last week he did the administration's bidding and signed onto an $8 billion package of new loans for Argentina.

''He's a vocal advocate for the president's agenda,'' said Treasury spokeswoman Michele Davis. And his outspokenness? ''Getting people's attention to focus on important issues is part of the job,'' she said.

Mark Zandi, chief economist for Economy.com, a consulting firm in West Chester, Pa., said O'Neill was ''a strong personality with his own views. And he seems to be willing to express them. That's very refreshing.''

''To say he's a loose cannon is going too far,'' Zandi added.

Lawrence Chimerine, president of Radnor Consulting of Philadelphia, said O'Neill still is ''not used to the fact that, when he says something he's not speaking as if he were still the CEO of a large company. He has to be much more careful in what he says.''

''Things will change as he learns this,'' Chimerine added.

Tom Raum has covered Washington for The Associated Press since 1973, including five presidencies.



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