Two key resignations at Treasury

Two resignations: Treasury secretary's is no surprise

Treasury secretary Paul O'Neill and Larry Lindsey, a White House economic adviser, have resigned in an economic policy shake-up. 'It has been a privilege to serve the nation during these challenging times," O'Neill said in a letter to President Bush today.

Mayi Canales, former acting Treasury CIO, said there had been talk about O'Neill's departure six months ago, but at that time, 'it just wasn't true.'

Michele Davis, a Treasury spokeswoman, said O'Neill remarked this morning that there were lots of other things for him to do in life. 'Back in December 2000, he was planning to retire and devote himself to improving health care and education in Pittsburgh,' Davis said.

The resignation will become effective in the next few weeks, she said.

A House Government Reform subcommittee official, who asked not to be identified, said the resignation 'has been expected here on the Hill. No one liked O'Neill, even the Republicans. This also lets Bush clear the decks before his big push for tax cuts and stimulus in the State of the Union address next month.'

A Treasury source who works for the chief financial officer commented that 'in an economic crisis, [Bush] has three top economic positions vacant.'

O'Neill was often criticized for his management style. One of his first orders after taking office was that Treasury bureaus be prepared to report their financial status within 72 hours of a request. It then took about 20 days to get balances from every bureau and analyze them.

The bureaus have been struggling to meet O'Neill's deadline [see story at]. O'Neill himself was under a mandate to comply with the Federal Financial Management Improvement Act of 1996. Three days to report, however, seemed nearly impossible to many Treasury officials.

'O'Neill would like it faster,' said David J. Epstein, director of Treasury's Office of Financial Systems Integration, in an interview with GCN this year.


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