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Mnuchin promises to boost US growth as Treasury boss | Mnuchin promises to boost US growth as Treasury boss |
(about 1 hour later) | |
Ex-Goldman Sachs banker Steven Mnuchin has vowed a tax overhaul not seen in decades to boost the US economy. | |
Donald Trump's new Treasury secretary promised "the most significant middle income tax cut since [Ronald] Reagan". | |
The Wall Street veteran said in a CNBC interview that the new administration also planned to cut the corporate tax rate from 35% to 15%. | |
His appointment was announced alongside confirmation that Wilbur Ross will be the new Commerce Department head. | His appointment was announced alongside confirmation that Wilbur Ross will be the new Commerce Department head. |
Mr Mnuchin said: "We think by cutting corporate taxes we'll create huge economic growth and we'll have huge personal income... Taxes are way too complicated and people spend way too much time worrying about ways to get them lower." | |
He said the US could "absolutely" achieve a 3%-4% growth rate, one of Donald Trump's key pledges. | |
Mr Mnuchin, 53, whose father also worked at Goldman Sachs, is relatively unknown as a public figure, despite building a career as a successful private equity investor and Hollywood financier. | |
He spent 17 years at the Wall Street bank before leaving in 2002 to set up an investment group which funded big movies such as "Avatar" and "Suicide Squad". | |
Mortgage controversy | Mortgage controversy |
More controversially, he persuaded billionaires George Soros and John Paulson to help him buy the failed bank IndyMac in 2009, which had collapsed under a portfolio of high-risk mortgage loans. | More controversially, he persuaded billionaires George Soros and John Paulson to help him buy the failed bank IndyMac in 2009, which had collapsed under a portfolio of high-risk mortgage loans. |
Rebranded as OneWest the bank grew to become one of California's largest lenders. | Rebranded as OneWest the bank grew to become one of California's largest lenders. |
But it was also accused of driving homeowners into foreclosure to generate earnings - claims Mnuchin has denied. | But it was also accused of driving homeowners into foreclosure to generate earnings - claims Mnuchin has denied. |
As Treasury secretary, Mr Mnuchin would be the administration's chief economic spokesman, responsible for selling its economic programme to Congress. | |
He has been described as bipartisan, however he has known Donald Trump for 15 years and worked as his presidential campaign's finance chairman. | He has been described as bipartisan, however he has known Donald Trump for 15 years and worked as his presidential campaign's finance chairman. |
Like Mr Trump, he has also criticised the Dodd Frank act - brought in by the Obama administration to stabilise the banking system - saying it prevented banks lending to smaller businesses. | Like Mr Trump, he has also criticised the Dodd Frank act - brought in by the Obama administration to stabilise the banking system - saying it prevented banks lending to smaller businesses. |
Five things about Trump's new treasury secretary | Five things about Trump's new treasury secretary |
Trump to 'leave business' over presidency | Trump to 'leave business' over presidency |
What conflicts of interest could Donald Trump have? | What conflicts of interest could Donald Trump have? |
Mr Mnuchin also complimented Janet Yellen, chair of the Federal Reserve, saying she had done a good job, but declined to comment on whether she would serve the rest of her four-year term, which ends in early 2018. | |
"Eventually we are going to have higher interest rates and that's something that this country is going to need to deal with," he added. | "Eventually we are going to have higher interest rates and that's something that this country is going to need to deal with," he added. |
'King of bankruptcy' | 'King of bankruptcy' |
Mr Mnuchin will be the third ex-Goldman Sachs banker to serve as Treasury secretary, but, with no prior government experience, some say he could struggle to navigate the world of Washington politics. | Mr Mnuchin will be the third ex-Goldman Sachs banker to serve as Treasury secretary, but, with no prior government experience, some say he could struggle to navigate the world of Washington politics. |
"People who come from Wall Street quickly find that they can't just make a decision and have it happen," said Stanley Collender, a communications expert who previously advised the House and Senate Budget Committees. | "People who come from Wall Street quickly find that they can't just make a decision and have it happen," said Stanley Collender, a communications expert who previously advised the House and Senate Budget Committees. |
"It's not like being a CEO. There is a lot more compromise involved." | "It's not like being a CEO. There is a lot more compromise involved." |
As head of the Commerce Department, Wilbur Ross will be responsible for managing America's business and trade policies. | |
The 78-year-old financier has been called the "king of bankruptcy" for buying distressed companies and turning them around, and has personal wealth of about $2.9bn, according to Forbes magazine. | |
Mr Ross advised Mr Trump on the campaign trail, in particular helping him shape his protectionist trade policy positions. | Mr Ross advised Mr Trump on the campaign trail, in particular helping him shape his protectionist trade policy positions. |
Mr Ross has blamed the North American Free Trade Agreement with Canada and Mexico, and China's 2001 entry to the World Trade Organization, for causing huge US factory job losses. | Mr Ross has blamed the North American Free Trade Agreement with Canada and Mexico, and China's 2001 entry to the World Trade Organization, for causing huge US factory job losses. |
Analysis: Anthony Zurcher, North America reporter | Analysis: Anthony Zurcher, North America reporter |
In February, Donald Trump lambasted Republican primary opponent Ted Cruz for being a pawn for the Wall Street firm Goldman Sachs. "They have total control over him, just like they have total control over Hillary Clinton," he said. | In February, Donald Trump lambasted Republican primary opponent Ted Cruz for being a pawn for the Wall Street firm Goldman Sachs. "They have total control over him, just like they have total control over Hillary Clinton," he said. |
Towards the end of the general election campaign, Mr Trump ran a television advert featuring a photo of Goldman head Lloyd Blankfein with a voice-over that condemned "a global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations". | Towards the end of the general election campaign, Mr Trump ran a television advert featuring a photo of Goldman head Lloyd Blankfein with a voice-over that condemned "a global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations". |
Now Mr Trump is tapping a former Goldman partner - a man who later chaired a company that aggressively foreclosed on delinquent mortgage-holders - as his Treasury secretary. | Now Mr Trump is tapping a former Goldman partner - a man who later chaired a company that aggressively foreclosed on delinquent mortgage-holders - as his Treasury secretary. |
Steven Mnuchin was an early supporter of Mr Trump - serving as his head fund-raiser - and this loyalty is being rewarded. | Steven Mnuchin was an early supporter of Mr Trump - serving as his head fund-raiser - and this loyalty is being rewarded. |
If the president-elect is serious about enacting the sweeping tax reforms he unveiled during his campaign, the corporate insider with political connections is the man for the job. | If the president-elect is serious about enacting the sweeping tax reforms he unveiled during his campaign, the corporate insider with political connections is the man for the job. |
His selection, however, is another bit of evidence that Mr Trump's sweeping anti-establishment condemnations may be a disappearing rhetorical relic of his presidential campaign. | His selection, however, is another bit of evidence that Mr Trump's sweeping anti-establishment condemnations may be a disappearing rhetorical relic of his presidential campaign. |
In a statement announcing his choice, Trump said: "Wilbur Ross is a champion of American manufacturing and knows how to help companies succeed. | |
"Wilbur knows that cutting taxes for working families, reducing burdensome government regulations and unleashing America's energy resources will strengthen our economy at a time when our country needs to see significant growth." |