February 2, 2017

Steven Mnuchin to be Secretary of the Treasury


  • On November 30, President-elect Donald Trump announced his intention to nominate Steven Mnuchin to serve as treasury secretary.
  • The Senate Finance Committee approved his nomination on February 1.
  • Steven Mnuchin has decades of experience in the financial sector.

Biography

Steven Mnuchin earned a bachelor’s degree in economics from Yale. He worked at Goldman Sachs for 17 years, first in mortgages, U.S. bonds, and municipal bonds, and later as the firm’s chief information officer. Mr. Mnuchin left Goldman Sachs for ESL Investments and later started his own hedge fund, Dune Capital Management, in 2004. In 2009, Mr. Mnuchin started OneWest Bank after acquiring the failed lender IndyMac. He was chairman and CEO of OneWest from 2009 to 2015. Mr. Mnuchin also founded RatPac-Dune Entertainment, which has invested in motion pictures.

Senate Action

The Finance Committee held a confirmation hearing for Mr. Mnuchin on January 19. After unprecedented delaying tactics by Democrats who boycotted the executive session, the committee approved the nomination on a 14-0 vote in a session that Democrats again boycotted.

Considerations

At his confirmation hearing, Mr. Mnuchin answered questions on a number of topics. On economic growth, he said he believes that the U.S. can achieve sustained growth of 3 to 4 percent and that tax reform is the most important part of achieving this. On tax reform, he said he would like to “simplify personal taxes, deliver a middle income tax cut, make U.S. business taxes competitive with the rest of the world,” and treat pass-through businesses fairly. He said, “we want to make sure that tax reform does not increase the size of the deficit” when measured on a dynamic basis. Mr. Mnuchin expressed support for modernizing the administration of the IRS by improving the agency’s whistleblower program and addressing the tax gap.

When pressed by Democrats, he did not commit to a “clean” debt limit increase. He endorsed an updated “21st Century” Glass-Steagall. He defended his record at OneWest Bank by explaining that another bank originated the lender’s bad mortgages; his bank voluntarily went into the Home Affordable Modification Program even though it didn’t have to; and they used Obama administration calculations to determine what mortgages needed to be foreclosed.

Issue Tags: Taxes, Banking, Economy