Mr. O'Neill Goes to Washington

And after getting the boot, the ex-Treasury Secretary now paints a portrait of Bush that would be comical if it weren't so chilling

By Ciro Scotti

In the annals of blabbermouths, former Treasury Secretary Paul O'Neill ranks up there with Lewinsky scandal songbird Linda Tripp and mob canary Joe Valachi. About midway through The Price of Loyalty: George W. Bush, the White House, and the Education of Paul O'Neill (Simon & Schuster), the controversial new book by former Wall Street Journal reporter Ron Suskind, O'Neill describes how disappointed Fed Chairman Alan Greenspan was that the first Bush tax cut did not include "triggers" that would have shut down the transfer of $1.35 trillion back to taxpayers if the budget surplus was evaporating. "Without the triggers, that tax cut is irresponsible fiscal policy," Greenspan is quoted as saying "in his deepest funereal tone" -- and, presumably, in deepest confidence.

With such loose lips about the ruminations of a friend and economic soulmate, imagine the revelations about O'Neill's enemies. Suskind is a smart writer, and in this quasi-memoir that has Washington aflutter, he deftly picks through some 19,000 documents and hours of interviews to open an often eye-popping window into the Bush White House. The question is, how unfiltered is the view? While Suskind and O'Neill may deny that they have an agenda, they seem hell-bent on substantiating the lovingly nurtured liberal notion that the President is an empty suit.

O'Neill now says that he did not intend to be critical of Bush or anyone else in the Administration. He just wanted to present "a chronicle of 23 months" in government. And in the book, he portrays himself as Diogenes in D.C., searching for the truthful policies he believes are created through rough-and-tumble, intellectually honest debate.


  The Price of Loyalty is being released at the start of a Presidential election year, however, and surely O'Neill is well aware that it will give pause to supporters of George W. Bush and provide larders of red meat for his critics. Is O'Neill's account of a White House that Lewis Carroll might have imagined an attempt to right a ship of state being steered toward dangerous shoals by the Mad Cowboy Hatter? Or is it the revenge of a prickly Captain of Industry summarily dismissed from office and embarrassed in front of his peers?

Probably it's both. And certainly O'Neill's impressions should be put in the context of the unbridgeable divide between his open-ended, cerebral management approach and the top-down, go-with-the-gut style of the President.

All that said, the portrait of Bush by the man he called Pablo -- a nickname that irritates O'Neill -- would be comical if it weren't so chilling. In the first of almost-weekly one-on-one meetings with the President, O'Neill comes prepared to spend an hour talking about the economy, tax cuts, and Social Security. And he does, pressing on with a monologue because the expressionless W. says nada to Pablo.


  As O'Neill points out, he wasn't exactly new to the Oval Office, having served Nixon, Ford, and Bush I, and wonked it up with Bill Clinton. "'I wondered, from the first, if the President didn't know the questions to ask,' O'Neill recalls. 'Or did his strategy somehow involve never showing what he thought?'"

That clearly is the card-sharp stance of Vice-President Dick Cheney, who emerges as a Strangelovian figure commanding vast swaths of the government yet leaving no footprints. "At the start, there was a sense that Dick would be the pragmatic voice...," O'Neill is quoted as saying, "providing a wide avenue for clear thinking and discussion.... Or so we all thought. We thought we knew Dick. But did we?"

Despite a friendship of several decades, O'Neill decides the answer is no. "This President was starting from scratch on most issues and relying on ideologues like [economic adviser] Larry Lindsey, Karl Rove, and now [O'Neill] feared, his old friend Dick. Not an honest broker in sight."


  Nowhere is the sense that everything is political, everything is scripted more overwhelming than in the deliberations of the National Security Council, as remembered by O'Neill. On January 10, 2001, a little over a week after he was inaugurated and eight months before September 11, Bush presides over the first meeting of his NSC. The topics are how to disengage from the Israeli-Palestinian impasse and how to confront Iraq. "Getting Hussein was now the Administration's focus, that much was already clear," O'Neill claims.

Loyalty fawningly presents O'Neill, the CEO who turned around Alcoa Inc., as a simple man who walks on both private- and public-sector water. But he comes across as hardly humble -- and having difficulty kowtowing to a President who hasn't earned his loyalty. The irony of the book is that O'Neill and Bush share a certain recklessness, though it's played out in opposite ways.

O'Neill believes that before taking action, ideas should be batted about like volleyballs until the right answer is reached. But he gets into trouble for shooting from the lip about the dollar, Wall Street, and Argentina. As for Bush, his utterances are rarely impromptu or impolitic, yet he seems to act on instinct -- ramming through massive tax cuts, running up the deficit, and barging into Iraq. Talk about a "bad fit." This twain should probably never have met.

Scotti is a senior editor for BusinessWeek in New York

Before it's here, it's on the Bloomberg Terminal.