Tuesday, September 23, 2008

Henry M. Paulson, Secretary of the Treasury

Henry M. Paulson, Jr., (above) is Secretary of the Department of Treasury. Mr. Paulson is in charge of fixing the subprime mortgage crisis.

The Administration is proposing a bill called the Troubled Asset Relief Program (TARP).

The International Herald Tribune (9-23-08) reports that the original draft of the proposed bill reads:

"Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

The International Herald Tribune (9-23-08) reports:

Joshua Rosner, a managing director at Graham Fisher, says TARP should stand for "Total Abdication of Responsibility to the Public." He calls it "a clear abdication of all congressional oversight and fiscal authorities to a secretary of Treasury that has bungled this crisis from the beginning."

He argues that the bill grants "greater powers to the secretary of the Treasury than even the president enjoys."

The bigger issue is that the bill effectively creates protections not just for the Treasury, but for the executives on Wall Street who created this near Armageddon. Rosner says the draft bill "prevents judicial review that could allow the protection of decisions that create false marks, hide prior marks, or could be used to prevent civil or criminal prosecution in situations where a management knowingly provided false marks that aided the growth of this crisis of confidence."

False marks - using mark-to-market accounting to hide the true value of security, rather than disclose it honestly - has a lot to do with why Jeffrey Skilling, the former Enron chief executive, is in jail.

Mr. Paulson used to work for Goldman Sachs. Here is his official biography:

President George W. Bush nominated Henry M. Paulson, Jr. to be the 74th Secretary of the Treasury on June 19, 2006. The United States Senate unanimously confirmed Paulson to the position on June 28, 2006 and he was sworn into office on July 10, 2006 by Supreme Court Chief Justice John Roberts. As Treasury Secretary, Paulson is the President's leading policy advisor on a broad range of domestic and international economic issues.

Before coming to Treasury, Paulson was Chairman and Chief Executive Officer of Goldman Sachs since the firm’s initial public offering in 1999. He joined Goldman Sachs Chicago Office in 1974 and rose through the ranks holding several positions including, Managing Partner of the firm’s Chicago office, Co-head of the firm's investment Banking Division, President and Chief Operating Officer, and Co-Senior partner.

Prior to joining Goldman Sachs, Paulson was a member of the White House Domestic Council, serving as Staff Assistant to the President from 1972 to 1973, and as Staff Assistant to the Assistant Secretary of Defense at the Pentagon from 1970 to 1972.

Paulson graduated from Dartmouth in 1968, where he majored in English, was a member of Phi Beta Kappa, and an All Ivy, All East football player. He received an M.B.A. from Harvard in 1970. He and his wife, Wendy, have two children, Amanda and Merritt.


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