U.S. Treasury Secretary John Snow
Sean Gallup  /  Getty Images file
U.S. Treasury Secretary John Snow, in a November file photograph.
updated 12/8/2004 7:46:26 PM ET 2004-12-09T00:46:26

Treasury Secretary John Snow, an aggressive champion of the administration’s economic policies, accepted President Bush’s offer Wednesday to remain in the Cabinet.

Bush’s decision kept an important member of his economic team in place as the president seeks to promote his second-term priorities of simplifying tax laws and overhauling Social Security.

At the same time, Veterans Affairs Secretary Anthony Principi told his staff he was resigning, a senior administration official said. Principi is the ninth member of Bush’s 15-person Cabinet to leave. He is a graduate of the U.S. Naval Academy and a decorated Vietnam veteran.

The White House was expected to announce his departure later in the day, NBC’s Norah O’Donnell reported. A nominee to succeed Principi, 60, as head of the federal government’s second-largest department was expected to be named soon, perhaps this week.

Principi appeared to be leaving the administration against his own wishes. He indicated in an interview last month with his hometown newspaper, the San Diego Union-Tribune, that he hoped to stay on for Bush’s second term.

Snow subject of speculation
Rumors had swirled in the capital about Snow’s future. Published reports said Bush would oust him. White House chief of staff Andrew Card told Snow to ignore it all. While Snow was at the White House for a weekly meeting on Wednesday afternoon, Bush summoned him to the Oval Office to ask him to stay on.

“The president is pleased Secretary Snow agreed to continue to serve,” White House spokesman Scott McClellan said.

“He’s done a great job and has been a valuable member of the economic team, and we have a lot of important work to continue to build upon the steps we’ve already taken to get the economy growing stronger and creating jobs,” McClellan said. “He’s been an integral part of those efforts.”

Bush has picked Kellogg Co. chief executive Carlos Gutierrez to succeed Don Evans at the Commerce Department but has not settled on a replacement for Stephen Friedman, the president’s chief economic adviser.

Snow, 65, is the former chief of CSX, the railroad company, and holds a Ph.D. in economics. McClellan said there was no limit on how long Snow would serve.

“The secretary is honored to help the president to implement his agenda to strengthen the economy,” Treasury Department spokesman Rob Nichols said.

In February 2003, Snow replaced Paul O’Neill, whose blunt-talking style — and open reservations about the wisdom of large tax cuts — irked the White House.

Snow has been a forceful advocate of the president’s economic policies, notably big tax cuts, on Wall Street and Main Street. He took the post at Treasury when the economy and the job market were struggling to recover from the 2001 recession, the Sept. 11 attacks and corporate accounting scandals.

During the 2004 presidential campaign, Snow traveled constantly, especially to the most contested states, promoting administration economic policies.

Occasional stumbles
On some occasions, his comments had repercussions. In a visit to Ohio near the end of the campaign, he said the notion that job losses were Bush’s fault was a myth. That became fodder for a political ad for Democrat John Kerry.

On a different trip to Ohio, Snow reignited the political argument about the shift of U.S. jobs to other countries, saying that that practice was an integral part of a global trading system.

Snow’s comments came against the backdrop of the loss of millions of manufacturing jobs in the United States. Democrats pointed to the losses as evidence, they said, that the president’s economic policies were failing.

As treasury secretary, Snow has preached the importance of financial literacy. Yet he did not catch an error of more than $10 million in his own investment portfolio right away, because he did not read his financial statements for more than a year. An investment adviser made the mistake that caused Snow to lose nearly $500,000.

The changeover in Bush’s Cabinet is on the high side for a second-term president. Presidents Clinton and Reagan saw seven Cabinet seats change hands after they won new terms, President Nixon nine and Presidents Truman and Johnson four each.

Principi praised and criticized during tenure
Principi has drawn criticism for suspending health care enrollments for some veterans and for approving plans to shut down some aging or underused VA hospitals.

But he was praised by veterans groups last month after announcing that that the VA was setting set aside up to $15 million for a year for research into so-called Gulf War Syndrome, expressly ruling out studies that sought to blame simple stress for the cluster of ailments.

Thousands of veterans of the first Gulf War have experienced undiagnosed illnesses, with symptoms such as chronic fatigue, loss of muscle control, diarrhea, migraines, dizziness, memory problems and loss of balance.

After disputing for many years that the illnesses were linked to the war, a VA panel found this year that the veterans’ illnesses could be linked to exposure to nerve gas and pesticides that military personnel encountered during the war.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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