Online Extra: "Less Government and Less Taxes"

The GOP sweep suits Bethlehem Steel CEO Steve Miller fine -- though he admits that Dems are often friendlier to his industry

Robert "Steve" Miller Jr., chairman and CEO of Bethlehem Steel (BHMSQ ), is a lifelong Republican. It's no surprise, then, that he was heartened that his party has retaken control of the Senate and gained seats in the House -- though not as much as his brother, Randy, a Republican state senator in Oregon and a former state party chairman. "My brother is doing handstands right now," Miller said the day after the midterm elections.

Still, the GOP's sweep isn't an unalloyed victory for Miller. The chief executive knows that Republicans generally favor free trade, and Bethlehem Steel is hanging on in bankruptcy today largely thanks to tariffs that President George W. Bush imposed on imported steel last spring. Nor does he see Republicans accomplishing much more on business issues such as taxes and trade than a split Congress did in the last year and a half. But don't get Miller wrong: In his view, the good guys clearly won on Nov. 5.

Miller, a corporate turnaround artist who has also been chief executive of Federal-Mogul (FDMLQ ) and Waste Management (WMI ), among others, talked with BusinessWeek Senior Correspondent Michael Arndt about the election results. Edited excerpts follow:

Q: Do you think the Republican victories will allow President Bush to accomplish some things that Congress has blocked or stymied?

A:

I don't know. It's still going to be a damn close margin in the Senate. I think the biggest impact is going to be on the judiciary branch. They're now going to be able to flow all the judicial appointments that Senate Judiciary Committee Chairman Patrick Leahy had all bottled up. If there's any one single change here, that's it. It may even have an impact on whatever succession we have at the Supreme Court.

If you look at the branches of government, curiously the one most impacted by the election is judicial. The second-most impacted is the executive, Bush himself as President. I think his credibility goes way up. He had put himself on the line. But the fact is that the balance of power has swung by a vote or two, so I don't think any huge change [is coming] in the basic direction of legislation.

Even with the Republicans controlling it all, I'm not looking for landmark legislation. It's not in the Republicans' nature to make wholesale changes.

Q: But what about taxes? Do you think we'll have another round of tax cuts now?

A:

The tax cuts are safe as opposed to being in jeopardy. We might see more tax cuts, but I would call it tweaking rather than major changes. There'll be a few additional gestures but it won't be a whole lot.

Q: Are there certain things that you as a business executive have been wanting from Washington that you now think you'll get?

A:

I think if you ask most businesspeople what they want, they would say, "Stop tinkering with our system." A lot of my friends think the gridlock we've had for the last 18 months has been a good thing: So long as the legislature can't do anything, they can't do any harm. But I think Republicans are more likely to tilt in a way to do things that will be helpful to business and the economy -- less government and less taxes.

Q: What's your take on the election from your perspective as a steel executive?

A:

On some of the sectoral issues of the steel business, this is not necessarily all good news. The Democrats have tended to be friendlier to the interests of the steel companies and the steelworkers. I think the Republicans with more of a free-trade orientation will be more inclined to let loose the tariff programs that have been in place. It's also going to be tougher sledding for all of the safety nets for steelworkers -- health-care and retiree benefits -- that we would like help with.

Q: Do you think Bush will now alter his own team?

A:

Well, he has already started with the resignation of SEC Chairman Harvey Pitt. I liked Harvey, I thought his heart was in the right place, but I think we're all better off to get a fresh start there. But as for the rest, I don't see anyone else who's looking to move on. I don't see that there's any clunkers in that Administration. I think, by and large, they've done a pretty good job.

Q: What about Treasury Secretary Paul O'Neill? He has come under some criticism.

A:

O'Neill is a bit of a free spirit. But I'm not sure everybody would be pleased if he went. I don't think the American people want to see a tight, insular group. I think having people with strong independent views -- I think Americans like that. Sectorally, O'Neill has been opposed to Bush's steel initiatives, including steel tariffs. But he's a very responsibility guy, and I would be happy to see him stay on.

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