Fewer Blunt Truths for Paul O’Neill
Paul H. O’Neill is in his element. After plodding through a prepared luncheon address in a room full of suits, the U.S. Treasury secretary has the run of a honking big truck factory.
O’Neill peppers plant manager Doug Maugh with questions. What’s the order book look like? What about working capital turnover? Are workers in a variable compensation pool? Maugh, who oversees production of 26 Kenworth Truck Co. rigs a day, gamely supplies the answers until O’Neill manages to stump him: What, he asks, is the plant’s lost work time rate? Maugh will have to check.
“I’m a plant freak,” O’Neill tells a group of Kenworth employees who stay after work to meet him. “I love manufacturing.” O’Neill’s affinity for assembly lines was on full display as he hit the road to sell America on President Bush’s economic program after last week’s forum in Waco, Texas. As long as he is prowling truck plants and cardboard box factories, exchanging information with people who make the economy tick, the former CEO of Alcoa and International Paper Co. is on safe and familiar ground.
But as he maneuvers through public appearances and responds to loaded questions under the harsh glare of media klieg lights, a less secure side of O’Neill’s persona is apparent. During an initial swing through Seattle, Denver and Portland, Ore., Bush’s famously blunt Treasury chief struggled to avoid saying or doing anything that might offend a key constituency or create an unwelcome distraction from the message he is supposed to deliver.
For a man who has elevated candor to a martial art, it’s not much fun.
“It’s hard for me to live in a world where you can’t tell the truth because somebody will stick a javelin in your heart for doing it,” he tells workers at the truck plant.
O’Neill occupies one of the world’s most influential public offices, has an impressive record as a corporate manager and is a persuasive advocate of global development. He would like to share what he’s learned about the powerful forces shaping the world economy and the changing nature of the U.S. workplace. But he can’t seem to find the right words to say, at least not for mass consumption.
“I thought that if I came and I told the truth and I tried to do an education job for the American people, there would be a big market for that. There’s not a big market for that, because I can’t get people to put what I say in context or report all of what I said in response to a question,” he tells reporters during his post-Waco tour.
“I’ve touched the hot burner so many times, I’m doing my best not to touch it anymore.”
But the burner comes with the job, and O’Neill’s reticence could limit his ability to articulate the administration’s economic policy at a critical time. The White House is under fire for not doing more to respond to new signs of economic weakness, gut-wrenching declines in stock prices and continuing revelations of corporate chicanery.
Critics have characterized the president’s economic team as inarticulate, inept and in need of a shake-up. Some of the harshest criticism has been aimed at O’Neill, who has angered lawmakers, rattled financial markets and antagonized foreign officials with his off-the-cuff comments and unvarnished critiques. Some political analysts have speculated that he might be the first high-ranking official to leave the administration, once the November congressional elections are out of the way.
Bush administration officials, including the president, insist that O’Neill’s job is secure. Asked Friday whether he had told O’Neill to stop being so straightforward, Bush laughed and said, “No, I didn’t. Listen, Paul O’Neill is doing a fine job as secretary of Treasury.... I find him to be refreshingly candid. I appreciate his judgment. He’s a man of great experience.”
O’Neill’s critics say he lacks the tact, discretion and finesse to interact comfortably with the financial community. Last year, for example, he told a German reporter that the administration was not trying to pump up the dollar’s value because economic fundamentals ultimately would prevail. The remark, while accurate, momentarily roiled currency markets. In another gaffe, O’Neill alienated security traders by suggesting that he could learn their jobs “in about a couple of weeks.”
He is sometimes compared unfavorably to Robert E. Rubin, a Wall Street luminary who received high marks as President Clinton’s second Treasury secretary.
There is no question that O’Neill, 66, is cut from a different cloth. He was a corporate CEO before joining Bush’s Cabinet, while most of his recent predecessors were financiers, politicians or professional economists. Although he got his start as a government number-cruncher, he is best known as the man who rescued Alcoa from industrial lethargy, boosting the aluminum producer’s sales, profits, stock price and market share after taking over in 1987. He enriched himself in the process, receiving stock and options worth more than $100 million. He didn’t always have it so good. When O’Neill was a young boy, his father worked for starvation wages as an orderly in a St. Louis veterans hospital, and the family learned to do without.
“We were really poor,” O’Neill says. “It’s not where you want to live your whole life, but recognizing that it’s possible to succeed and do things that you want to do and having to work for it is not such a bad thing.”
Perhaps that’s why he feels so comfortable rubbing elbows with line workers. “I love going to factories,” he tells an audience in Portland. “It’s the heartbeat of America to go see plywood mills and cardboard container plants, and talking to workers on the floor about how they feel about what they’re doing. An awful lot of folks in Washington and New York think the sun only rises and sets in those two places. I don’t believe it.”
At the Kenworth Truck Co. plant, he displays concern when workers tell him that future production is threatened by the failure of diesel engine makers to comply with new federal emission standards. When employee Janis Brown questions the wisdom of Bush’s decision to place tariffs on imported steel, making Kenworth’s trucks more expensive to manufacture, O’Neill mentions the plight of the “real human beings” who lose their jobs when U.S. mills can’t compete against low-cost foreign steel.
He begins to outline his views on the future of U.S. workers in an increasingly globalized world, but he insists on doing so off the record, so his comments won’t appear in print.
The same thing happens at other stops. In Portland, Michael and Pam Didner, a husband and wife who work for Intel Corp., ask O’Neill what should be done about U.S. technology jobs that are migrating to such countries as India, Russia and China. O’Neill responds with an articulate overview of globalization’s long-term benefits, but he asks reporters to leave it out of their stories.
At breakfast with Oregon farmers and foresters, O’Neill clams up when asked about the dollar. “This is the most dangerous territory for me because everything and anything I say about foreign exchange rates gets blasted across the world and unsettles markets,” he says. “So I’m not going to engage this subject directly.”
O’Neill blames his communication problems in part on the media’s propensity to reduce lengthy, nuanced explanations to short, stark sentences and sound bites. Even more troubling, he says, is a dramatic pendulum swing from the late 1990s, when dot-com hucksters became cultural heroes, to the early 2000s, when every CEO is suspected of being a crook.
“It’s almost like there’s an endless quest to find the next corporate wrongdoer. Somebody who can find that is going to get promoted and get more responsibility and a better beat or something.”
Meanwhile, O’Neill will try to continue preaching the administration line without sounding like a robot.
“I hate doing the scripted stuff,” he tells reporters in Seattle. “When I see people doing scripted stuff, I don’t know whether they can think or not. All I know is that they can read. When people start reading to me, I turn my mind off because I figure they don’t really know anything.”
