Executive Session

EXECUTIVE SESSION -- (Senate - June 28, 2006)

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Mr. SCHUMER. Mr. President, I rise to speak in enthusiastic support of the nomination of Henry Hank Paulson to be the 74th Treasury Secretary.

I have known Hank Paulson for 15 years. I recommend him to my colleagues wholeheartedly and without reservation. He is one of those great New Yorkers who come from somewhere else--in this case, the heartland of America--come to our city and become part of its life and a vital part of this country and actually this world's economy.

Mr. President, Hank is an extraordinary leader, a great financial thinker, a businessman, a father, and, as I said, an adopted son of New York. Hank has excelled in every area of life--from the classroom to the football field to the boardroom and everywhere in between.

One of the things I like best about Hank is he is a straight shooter. He gives you direct answers to direct questions.

We sure need somebody like that now.

He graduated from Dartmouth in 1968 and received his MBA from Harvard. He worked at the Defense Department, the Nixon White House, and then found his true calling at Goldman Sachs where he worked for 32 years. He became chairman and chief executive officer of Goldman in 1999, and should he be confirmed, he will continue a long history, a great tradition of leaders from Goldman serving in the Government, including Bob Rubin, one of the great Treasury Secretaries, and Jon Corzine, our former colleague, now Governor of New Jersey, and John Whitehead, who served honorably and well as Deputy Secretary of State under Ronald Reagan.

But the issue Hank really goes off the charts about, I say to my colleagues--particularly my colleagues on this side of the aisle will be happy to know--is the environment. Sometimes he would call me up and I would be sure he was talking to me about swaps or banking or some esoteric financial issue, and he would be talking to me about an environmental policy. I don't think he ever gets more enthusiastic than when he is talking about some rare bird that he saw on one of his bird-watching jaunts. He is an avid environmentalist and lover of all things in nature. I hope a few of my colleagues on the other side of the aisle will not hold that against him.

He is also one of those unique, good people who could fill any number of Cabinet posts. For instance, given his environmental proclivities, he would be a great Secretary of the Interior. But financial issues and the health of the global economy are his passions, that is mostly where he is needed, and I am glad the President has nominated him for this post.

In the world of finance and international markets, there is simply no equal to Hank. At this critical point in our economy's history, we need Hank's expertise and experience to lead the way.

The bottom line, Mr. President--you know it because we traveled to China together--we are at an amazing time economically. The world economy is becoming integrated, closer and closer every year. There is almost a one world labor market. Capital flows freely to every corner of the world. These circumstances present tremendous challenges for our Nation, in our desire to remain the world's economic leader, and for the world as we try to integrate this system. One of the great challenges we face is we are converging into one economic system, but we don't have one political system, and the bumps and grinds which that causes are large.

So we need someone who understands markets. We need someone who has great experience traveling the world and knowing how the rest of the world's economic system works. Hank Paulson has all of those qualities. I am particularly glad that he knows a whole lot about China--I think he has been there over 70 times--because I believe the most important bilateral economic relationship in the next decade or two will be the American-Chinese relationship. Hank has the ability to understand the economies of both countries and figure out how we can work together.

I have been very concerned about China playing by the rules. I have been very concerned that China doesn't simply seek the advantages of free trade but not the responsibilities. I have related these concerns to Hank Paulson.

On currency, Senator Graham and I have worked closely with his predecessor, and you, Mr. President, have been involved in those issues as well as we traveled to China together. And we have worked to push and prod China to allow its currency to float based on international market forces. We have made some progress, but the progress since July has been too little, particularly in light of the fact that the Chinese assured us they know they have to get to a place where their currency floats.

Hank's extensive experience in China, his personal relationships with both the Government and business side--where, incidentally, there is quite a dichotomy. Most of the businesspeople and people even on the economic side of Government understand the need for free markets. That is in China's interests--not just America's--that China open up its markets. But a lot of people on the Government side are afraid of that. They don't like change. They don't like giving up control.

I think Hank Paulson is the right man at the right place at the right time to tackle the issue of persuading China to open up its markets more quickly. I believe that he is going to be able to show the Chinese that it is not only in our interest but in their interest as well to allow the yuan to float freely and to open up China's vast economic markets to American financial firms.

On financial services liberalization, I know Hank will work closely with Ambassador Schwab, who was just confirmed, to make sure that China lives up to its WTO commitments. This is going to be very important in the next few months because on December 11 of this year, many of the current restrictions faced by American financial firms that want to do business in China, such as purchase Chinese companies or open up branches in China, will be lifted. Hank is the perfect person to monitor China's progress and, more importantly, to prod the Chinese to go further than they have already promised.

In short, Mr. President, Henry Paulson is a thoughtful, dedicated, and renowned financial leader. I think this country will greatly benefit from his leadership. I am not at all shy about criticizing the President's nominees when I don't think they measure up to the job. I have done that in the judicial area repeatedly. But when the President nominates a sterling person, that person deserves praise and credit and, in my judgment, unanimous support in this body, and I believe that Hank Paulson is such a person.

I will be proud to vote aye when his name is offered on this floor in a few hours.

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