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Jewish World Review Jan 13, 2004 / 19 Teves, 5764

John H. Fund

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Rage of a Relic: Paul O'Neill is angry that the world has passed him by. | I once had dinner with Paul O'Neill, the former Treasury secretary who is now making headlines with a scathing portrayal of his days in the Bush administration prior to his firing in December 2002. Bush critics will hail Mr. O'Neill as a truth-teller, White House aides are already calling him a back-stabber. In fact, Mr. O'Neill is a relic. The man I broke bread with was clearly a product of the Nixon and Ford administrations, in which he had served, and simply hadn't adapted to the post-Reagan Republican Party.

Mr. O'Neill came into the Bush administration on the recommendation of three old friends from the Ford years: Dick Cheney, Alan Greenspan and Donald Rumsfeld. Mr. O'Neill, a moderate Republican, quickly discovered that his friends had changed in the intervening quarter century. He got little sympathy when he sought them out to express his dissatisfaction with the conservative tilt of the Bush administration. "The biggest difference between then and now," Mr. O'Neill told reporter Ron Suskind, "is that our group was mostly about evidence and analysis, and Karl [Rove], Dick [Cheney], Karen [Hughes] and the gang seemed to be mostly about politics. It's a huge distinction."

This analysis reveals either Mr. O'Neill's naiveté or poor memory. Richard Nixon's was one of the most cold-bloodedly political administrations in American history, imposing wage and price controls despite overwhelming economic evidence that they would harm the economy and trundling Henry Kissinger before TV cameras just before the 1972 election to announce that "peace was at hand" in Vietnam. The Ford administration adopted gimmicky tax rebates, passed out silly "Whip Inflation Now" buttons and ruthlessly squashed the insurgent challenge of Ronald Reagan when he challenged Mr. Ford in the Republican primaries.

Mr. O'Neill was a fish out of water in the Bush administration. Time magazine reports that he considered himself, Environmental Protection Agency administrator Christine Todd Whitman and Secretary of State Colin Powell to be "three beleaguered souls . . . who shared a more nonideological approach [but] were used for window dressing." Mr. O'Neill tells Mr. Suskind, the author of a new book that tells Mr. O'Neill's side of his tour at Treasury, that the three moderates "may have been there, in large part, as cover" for the administration's conservative agenda.

But it wouldn't have taken much for Mr. O'Neill to figure out that on issues his new boss would more resemble Ronald Reagan than Nixon, Ford or the first George Bush. All he had to do was pay attention to Mr. Bush's record in Texas and his 2000 campaign. When Mr. O'Neill accepted the job as Treasury secretary he knew it entailed being a loyal member of a team, dissenting in private if he disagreed with the president's views.

Instead, Mr. O'Neill early on seemed to become a public spokesman for every cause except his boss's policies. He questioned the need for a strong dollar, sending the currency into a nosedive. His tour of Africa with rock star Bono veered into advocacy for action on AIDS, not exactly a brief of the Treasury Department. He also emerged as an aggressive advocate of action on global warming. At the first meeting of the president's cabinet, Mr. O'Neill passed out copies of a speech he gave in 1998 in which he said that there were two issues that transcend all others: "One is nuclear holocaust. . . . The second is environmental: specifically, the issue of global climate change and the potential of global warming."

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Mr. O'Neill was also surprisingly indiscreet. In our dinner conversation he told me things about his disagreements with the administration that I was surprised a cabinet officer would reveal. I was impressed by his candor but not by his wisdom. He was saved from my publishing them only by his offhand request in the middle of the meal that they be off the record.

After the president's first tax cut became law in mid-2001, Mr. O'Neill also made clear his antipathy towards further reductions. This was in line with his past stands: backing the first President Bush's politically and economically disastrous tax increase of 1990 and lobbying President Clinton for energy taxes.

His opposition to lowering taxes came to a head after the 2002 midterm elections, when Republicans scored historic gains in Congress by running, in part, on the promise of more tax cuts. Mr. O'Neill recalls a meeting with Dick Cheney, his old chum, in which he quotes the vice president as saying, "Reagan proved that deficits don't matter. We won the midterm elections, this is our due."

To Mr. O'Neill this was shocking. He worried about "how to use the nation's resources to improve the condition of our society" and wanted to explore reform of Social Security and the tax code instead. He now admits that the tax cuts he opposed helped spur the "terrific" state of the economy today, but he says he would have been happy with a little less growth. That's easy to say now, but a much harder stance to take a year ago when the economy was still sputtering.

When Mr. O'Neill was pushed out of his post at Treasury he returned home to Pittsburgh in a huff but nonetheless managed to remain gracious. "I was never angry with the president," he told a local TV show. "I'm determined not to say any negative things about the president and the Bush administration. They have enough to do without having me as a sharpshooter."

That was then and this is now. It now turns out Mr. O'Neill has talked nearly daily for the last year with Mr. Suskind, a former reporter for The Wall Street Journal, who has now written a new explosive book on President Bush's first term. Mr. O'Neill also turned over to Mr. Suskind a minute-by-minute accounting of his time in office along with CD-ROMs containing 19,000 pages of documents he took with him from Washington.

Mr. O'Neill may have been a team player during his time in the Nixon and Ford administrations, but his tenure as the successful head of Alcoa, the aluminum company, seems to have instilled in him "CEO disease," the inability for someone who runs a large enterprise to adapt and subordinate a large ego to the interests of a group.

Far from being a truth-teller, Mr. O'Neill comes across in Mr. Suskind's book as a vengeful Lone Ranger, someone bitter because his advice was spurned but who stubbornly chose to stay in the job anyway. "He could have resigned quietly on principle," one White House aide told me. "Instead we had to push him out."

Mr. O'Neill may like to see himself as a contemporary Cyrus Vance, who in 1980 left as Jimmy Carter's Secretary of State over principled disagreements on foreign policy. But instead he resembles Don Regan, the temperamental White House chief of staff who, after President Reagan fired him, went on to write a tell-all book embarrassing his old boss with revelations about Nancy Reagan's fondness for astrologers. The book made Mr. Regan look small and it didn't do much damage to Mr. Reagan's reputation. The same will be true of Mr. O'Neill's poison-pen recollections.

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©2001, John H. Fund