A Few Good Insights about Henry Paulson

By March 7, 2007Economy, Trade

Irwin M. Stelzer, director of economic policy studies at the Hudson Institute, has written a nice mini-profile of Treasury Secretary Henry Paulson, with a bit of Bernanke-analysis added on. On the SecTreas:

Paulson, who has the bounce in his step denied to longer-serving members of the Bush administration, described his “passion” for free trade. Most of the job losses we have witnessed in recent years, he says, are due not to foreigners taking over U.S. markets, but to changing technology that has, for example, replaced humans with robots on factory floors. The only way to continue to raise living standards is to keep the economy open and growing, a lesson that seems so obvious to Paulson that he is stunned that anyone can doubt it. But stunned he has been since coming to Washington. It is not only Democrats who are leaning towards protectionism, but many members of his own party. The uniform advice of the think-tank denizens he gathered to advise him — none threatened with loss of his job to lower-paid Chinese — was for the secretary to push forward with freer trade and avoid new, expensive programs to assist those displaced by it.

Paulson is more open than the denizens about training programs, perhaps more streamlined and effective alternatives to the current confusing mish-mash, Steltzer reports, noting that support for free trade rests on a measure of public confidence.

Whether Paulson will be able to rally political support for more sensible programs, including perhaps training vouchers that free displaced workers to bypass the bureaucracy and sign on to training most likely to result in good jobs, he says he just doesn’t know.

All in all, a good window into Paulson’s thinking — with some insights about Bernanke thrown in for good measure.