Monitor Breakfast with Treasury Secretary John Snow

Did Bush squander the surplus? Treasury Secretary John Snow answers tough questions about the US economy.

John W. Snow is the nation's 73rd Secretary of the Treasury. Secretary Snow was chairman and CEO of CSX Corporation. He has a Phd in economics from the University of Virginia and a law degree from George Washington University. He served as chairman of the Business Roundtable from 1994 through 1996.

On the state of the economy:

"There is a recovery under way. But it is too uncertain, slow, and lacking robustness and the vigor we would like to see."

On promoting the president's tax plan:

"I would acknowledge we have some work to do to make the dividend concept more understandable, make it come alive, make it more readily palpable to people. Because it really is the centerpiece of the long-term growth part of the package."

On the risk the president's tax plan will lead to a dangerous level of deficits:

"The risky thing to do is not to get the economy back on a stronger growth path. That would really be risky. And not to take out the insurance policy for the short term that would have the economy recovering. There are huge costs in not having the economy recovering. ... Can we afford these tax proposals? I think the answer there is absolutely 'Yes.'"

On nature of the federal budget problem:

"The budgetary problems the country faces are not in the near term. The budgetary problems the country faces are out there in 2012 when the impact of the baby boomers really begins to hit Social Security."

On the impact of war with Iraq on the economy:

"The cost of the war is a one-time sort of thing."

On the disappearing federal budget surplus:

"I think everybody was living in a sort of Alice-in-Wonderland world. You had those $5.6 trillion surplus numbers and acted as if that surplus was real. People say, "Mr. Snow, you squandered the surplus." I am saying we all made a mistake, we ought to be humbled who do economic forecasting. There wasn't any surplus to be squandered. The surplus wasn't there."

On whether voters should hold President Bush responsible for the state of the economy:

"The real question is, having inherited a bad situation, did the president make it better than it otherwise would have been? I think the answer there is a resounding affirmative, 'Yes'. If he hadn't taken the lead in the '01 tax reduction plan, we would have a much deeper, much harsher, much more difficult recession."

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