The Tech - Online EditionMIT's oldest and largest
newspaper & the first
newspaper published
on the web
Boston Weather: 75.0°F | Mostly Cloudy

Bentsen to Leave Treasury Position Early Next Year

By Clay Chandler and Ann Devroy
The Washington Post

Treasury Secretary Lloyd Bentsen has told President Clinton that he will resign early next year and Clinton will tap economic adviser Robert E. Rubin to replace him, perhaps as early as Tuesday, Clinton administration officials said Monday.

Bentsen's departure will deprive the president of an experience legislative strategist just as the White House gears up for battle with a Republican-controlled Congress. Rubin's move to Treasury would thrust him from a behind-the-scenes coordinating role, in which he has been considered highly effective, into a high-profile position as the administration's most visible spokesman on financial issues.

Rubin, a millionaire investment banker who left his position as co-chairman of Goldman Sachs & Co. to head Clinton's National Economic Council, is not expected to make any major policy shifts. But he is unlikely to match Bentsen's instincts for dealing with Congress.

The front-runner to replace Rubin is Deputy White House Chief of Staff Erskine Bowles, officials said, who won high marks within the administration for defending Clinton's health care plan against fierce opposition from small business when he headed the Small Business Administration.

And the team is likely to lose another player by spring. Commerce Secretary Ronald H. Brown is the "leading candidate" to be the chairman of the Clinton re-election campaign, two senior officials said Monday. One of those officials, who has spoken with Brown, said such a move would likely come in late March or April.

Bentsen, 73, who had the president's respect but whose counsel on a variety of policy issues was often disregarded, raised the prospect of his departure with Clinton in September, administration officials said. He told the president of his intention to resign over the weekend, according to officials.

Bentsen, whose third Senate term would have expired this year if had not joined the administration, will be exiting on a high note, after helping Clinton win congressional approval for a new global trade agreement last week.

But while at Treasury, the department has had its share of embarrassment: a disastrous Bureau of Alcohol, Tobacco and Firearms operation against a religious cult in Waco, Tex., questions about the Secret Service's effectiveness protecting the White House and a controversy about how Treasury handled an inquiry into a failed savings and loan with which the president and Hillary Rodham Clinton had business dealings.

Asked after a speech before large audience at the National Press Club Monday whether he was stepping down, Bentsen said: "I would say, in paraphrasing Mark Twain, the news is premature. I'll let you know."

Bentsen's departure was reported in Monday's editions of the Wall Street Journal.

Bentsen, who served in Congress for nearly three decades, was Senate Finance Committee chairman before joining the administration, told friends and associates that he probably would not remain in the Cabinet for the full four years of Clinton's term.

Treasury aides insisted Monday that Bentsen's departure did not reflect any serious policy differences with the White House. But the courtly Texas millionaire's views on a range of important issues from health care to tax policy are far more conservative than any other member of Clinton's cabinet. In addition, Bentsen's patience with Clinton's undisciplined management style - which was thin from his first days in the administration - has been worn down to the bone.

Rubin declined comment Monday on reports that he would replace Bentsen. Administration officials said Monday they expected little Senate resistance to his nomination.

Like Bentsen, Rubin has been a forceful advocate for free trade and restrained government spending, and has strong ties to the corporate world. He has forged a close working relationship with Federal Reserve Chairman Alan Greenspan, and joined Bentsen in insisting the administration refrain from public criticism of the Fed's policy of raising interest rates.

Rubin, 57, has won high marks for his low-key management style at the National Economic Council, the inter-agency coordination group set up by the Clinton. The prospect of his departure prompted concern among Clinton's economic advisers, who said the NEC, the funnel through which all information for the president must pass, could be used to cut off their access to the president.