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GOP senators hail Obama's economic team |
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By Alexander Bolton
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Posted: 11/25/08 03:30 PM [ET] |
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Senior Senate Republicans who battled former President Clinton on budget and tax issues are applauding the return of his economic team to President-elect Barack Obama’s White House.
Sen. Judd Gregg (R-N.H.), a leading congressional Republican on economic issues, lauded Obama’s appointment of Timothy Geithner as Treasury Secretary and Lawrence Summers as head of the National Economic Council.
Summers served as Treasury Secretary and Geithner also worked at Treasury during the Clinton administration, when the nation saw booming economic growth. Geithner served under Summers as undersecretary for international development.
“I think the choices he’s made so far are extraordinarily strong,” Gregg told The Hill in an interview. He said the picks would soothe anxious financial markets.
“Summers and Geithner, I’ve described them as putting Manny Ramirez and David Ortiz in the lineup,” said Gregg, drawing an analogy to two sluggers who played together on his favorite baseball team, the Boston Red Sox.
“It sends a message to the market that there will be continuity of the effort” by Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke to stabilize the markets, he said.
Sen. Chuck Grassley (Iowa), the senior Republican on the powerful Finance Committee, also praised Obama’s first moves.
“During the campaign, the kind of change that the president-elect promised was so undefined it made me nervous,” Grassley said in a statement. “Now that he's appointing familiar faces from the Clinton administration to very high-level positions, I'm less concerned.”
Grassley said the return of senior officials from Clinton’s administration eased his concern about Obama’s ability to handle the economic crisis.
Gregg, the senior Republican on the Budget Committee, worked closely with Paulson and Bernanke to craft a Wall Street stabilization package in September. Some Republicans and Democrats have criticized the rescue package as a waste of taxpayer money.
Gregg and Grassley also touted Obama’s selection of Peter Orszag to head the Office of Management and Budget. Orszag is now director of the Congressional Budget Office.
“Larry Summers and Peter Orszag were part of the Clinton administration, where they saw up close how the tech bubble developed,” Grassley said. “They also responded constructively to pressure from the Republican-led Congress to restrain spending and put in place pro-growth and pro-family tax relief policies.”
Gregg compared Orszag to Red Sox star second-baseman Dustin Pedroia, who won the American League’s most valuable player award for 2008.
Separately, Gregg urged Bush administration regulators to take fast action on so-called mark-to-market rules that he said could have a strong negative impact on the financial markets.
The rules require financial institutions to value assets at what they would fetch immediately on the market. Gregg and other experts worry these strict rules would require financial companies to report their holdings at artificially low values and send stocks plunging even lower.
Gregg said regulators should allow financial companies to determine the “reasonable value” of these assets.
“This is something that can be handled by the regulators,” said Gregg, who said the Securities and Exchange Commission also should take action to discourage short-selling, which experts have blamed for driving down markets.
Gregg suggested the SEC reinstitute the so-called uptick rule, which requires speculators to short a stock that is going up instead of going down. The rule, which was repealed several years ago, was intended to discourage short-selling stampedes among investors who seek to earn a profit by driving down the values of otherwise solid stocks.
“I think they should reinstitute the uptick rule so people have to cover,” Gregg said. “People are betting short, short, short without having to cover.
“It would be best if the Congress didn’t have to act,” he said. “The SEC has all the authority and it should act.”
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