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CNN Live Saturday
Interview With Bob Lenzner
Aired December 07, 2002 - 17:52 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: There's no official word, but there is unofficial speculation about replacements for two ousted members of President Bush's economic team. Treasury Secretary Paul O'Neill and chief economic adviser Larry Lindsey resigned yesterday at the request of the White House. Bob Lenzner is the national editor of "Forbes" magazine and he has some opinions on what this shakeup means. Bob, what does this mean to the consumer?
BOB LENZNER, FORBES MAGAZINE: Well, what it means is that this is a crucial time for the economy, just as it is for Iraq. We have high unemployment, we have a huge budget deficit. We have a huge balance of trade deficit. We have not had a consistent, cohesive economic policy. We have not had leaders of our economic policy that appear on television to tell the public what's going on, as we do with Secretary of Defense Rumsfeld and Condoleezza Rice and the rest of them.
So he's got -- he's replacing the whole team. He also has to replace the chairman of the SEC, and he's having a very hard time doing that. And the problem is that he needs somebody as secretary of the treasury who will both give Wall Street confidence and also be able to get a program through Congress.
Now, the program through Congress has got to be that we have to spend more money, we have to stimulate the economy, because it's very soft right now. The Fed has lowered interest rates. They're as low as they've ever been for over 40 years, and there is no place else for the Fed to go to lower interest rates, so we have to stimulate the economy in other ways. We have to cut taxes on corporate dividends. We probably have to do some other programs to stimulate the economy.
And he needs a team, a cohesive team to put this program through. I don't think it's going to be easy to do. They've had a very hard time convincing anybody to take the chairman of the SEC job.
LIN: And also the names being bandied about to replace Lawrence Lindsey and Paul O'Neill. A couple of the names, they are actually Wall Street insiders, for example Stephen Friedman. What do you know about him to replace Lawrence Lindsey.
LENZNER: He's a very close personal friend of mine, as a matter of fact. I think he's a very good man, but he's not an economist. He's an investment banker. They're talking about him for the economic post, not as secretary of the treasury?
LIN: Right. LENZNER: Well, he ran Goldman Sachs in tandem with Bob Rubin, who of course was a great secretary of the treasury. Friedman is a very clear thinking person. He could express what's going on to the consumer and make him understand it, I think. I think that would be a very good choice, but he's not an economist.
LIN: What about Charles Schwab for secretary of the treasury?
LENZNER: Well, frankly, I think that's kind of ridiculous, because Schwab has all kinds of conflicts. I don't think that he would be an appropriate person. I'm not sure that the establishment in Wall Street would appreciate that. I'm not sure that that would make investors or consumers particularly happy.
LIN: Why?
LENZNER: Because he is -- he just represents a securities firm that's trying to do business with the public. He doesn't represent anybody that particularly can be identified as being a great leader of Wall Street. I don't agree with that. I know that his name is being bandied around because he was at the conference in Texas over the summer. In my opinion, if they choose him, that would be the wrong choice.
LIN: Yeah, the president's big economic conference out at his ranch over this summer. So who do you think is a lead candidate then?
LENZNER: I think it's very -- they're also talking about Senator Gramm or some other Republican politician. The problem with that is that you have to have somebody that can both make -- calm the markets down, and they've been as we know very, very bad and volatile, and also deal with foreign financial leaders at this very difficult time, because they have to stimulate their economy, as well.
So frankly, I think this is a very difficult choice. I don't know who they're going to get.
LIN: All right, well, hopefully we will find out soon. Thank you very much, Bob Lenzner, with "Forbes" magazine.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired December 7, 2002 - 17:52 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: There's no official word, but there is unofficial speculation about replacements for two ousted members of President Bush's economic team. Treasury Secretary Paul O'Neill and chief economic adviser Larry Lindsey resigned yesterday at the request of the White House. Bob Lenzner is the national editor of "Forbes" magazine and he has some opinions on what this shakeup means. Bob, what does this mean to the consumer?
BOB LENZNER, FORBES MAGAZINE: Well, what it means is that this is a crucial time for the economy, just as it is for Iraq. We have high unemployment, we have a huge budget deficit. We have a huge balance of trade deficit. We have not had a consistent, cohesive economic policy. We have not had leaders of our economic policy that appear on television to tell the public what's going on, as we do with Secretary of Defense Rumsfeld and Condoleezza Rice and the rest of them.
So he's got -- he's replacing the whole team. He also has to replace the chairman of the SEC, and he's having a very hard time doing that. And the problem is that he needs somebody as secretary of the treasury who will both give Wall Street confidence and also be able to get a program through Congress.
Now, the program through Congress has got to be that we have to spend more money, we have to stimulate the economy, because it's very soft right now. The Fed has lowered interest rates. They're as low as they've ever been for over 40 years, and there is no place else for the Fed to go to lower interest rates, so we have to stimulate the economy in other ways. We have to cut taxes on corporate dividends. We probably have to do some other programs to stimulate the economy.
And he needs a team, a cohesive team to put this program through. I don't think it's going to be easy to do. They've had a very hard time convincing anybody to take the chairman of the SEC job.
LIN: And also the names being bandied about to replace Lawrence Lindsey and Paul O'Neill. A couple of the names, they are actually Wall Street insiders, for example Stephen Friedman. What do you know about him to replace Lawrence Lindsey.
LENZNER: He's a very close personal friend of mine, as a matter of fact. I think he's a very good man, but he's not an economist. He's an investment banker. They're talking about him for the economic post, not as secretary of the treasury?
LIN: Right. LENZNER: Well, he ran Goldman Sachs in tandem with Bob Rubin, who of course was a great secretary of the treasury. Friedman is a very clear thinking person. He could express what's going on to the consumer and make him understand it, I think. I think that would be a very good choice, but he's not an economist.
LIN: What about Charles Schwab for secretary of the treasury?
LENZNER: Well, frankly, I think that's kind of ridiculous, because Schwab has all kinds of conflicts. I don't think that he would be an appropriate person. I'm not sure that the establishment in Wall Street would appreciate that. I'm not sure that that would make investors or consumers particularly happy.
LIN: Why?
LENZNER: Because he is -- he just represents a securities firm that's trying to do business with the public. He doesn't represent anybody that particularly can be identified as being a great leader of Wall Street. I don't agree with that. I know that his name is being bandied around because he was at the conference in Texas over the summer. In my opinion, if they choose him, that would be the wrong choice.
LIN: Yeah, the president's big economic conference out at his ranch over this summer. So who do you think is a lead candidate then?
LENZNER: I think it's very -- they're also talking about Senator Gramm or some other Republican politician. The problem with that is that you have to have somebody that can both make -- calm the markets down, and they've been as we know very, very bad and volatile, and also deal with foreign financial leaders at this very difficult time, because they have to stimulate their economy, as well.
So frankly, I think this is a very difficult choice. I don't know who they're going to get.
LIN: All right, well, hopefully we will find out soon. Thank you very much, Bob Lenzner, with "Forbes" magazine.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
