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'Economic Leaders' Who Met Bush Are Also Donors
Tue February 10, 2004 08:44 PM ET

By Adam Entous

WASHINGTON (Reuters) - Billed by the White House as a round-table of "economic leaders" on U.S. policy, several of the CEOs who huddled with President Bush on Tuesday were also major contributors to his and other Republican campaigns, records show.

Among them was Goldman Sachs Chief Executive Henry Paulson, who emerged from the White House with only praise for the administration's policies despite warnings from his firm's senior economist about rising federal budget deficits.

"Sentiment is better. Debt markets are better. ... The president's economic programs are working," said Paulson.

Like other economic round-tables arranged by the White House, Tuesday's brought together people who mostly see eye to eye with the president -- or at least do so publicly.

In a book about his rocky tenure as Bush's first Treasury secretary, Paul O'Neill derided what he saw as little more than cheerleading sessions stacked with loyalists. O'Neill was later fired for balking at Bush's new round of tax cuts.

The White House says the meetings allow Bush to gauge boardroom sentiment first hand.

White House spokesman Scott McClellan announced Tuesday's session as a gathering of "economic leaders" from "growing sectors of our economy," including the high-tech, financial, automotive and retail sectors.

"This is an opportunity for the president to highlight his six-point plan for strengthening the economy even more," McClellan said.

What the White House did not mention was that several of the executives in attendance also happened to be major Republican donors, including Michael Dell, founder and CEO of Dell Inc., according to records compiled by the Center for Responsive Politics.

After the meeting, with the White House press staff looking on, Hewlett-Packard Co. CEO Carly Fiorina praised Bush's tax cuts and described the reaction of all the business leaders in the room as "quite enthusiastic." She gave $2,000 to Bush last year.

MUM ON BUDGET DEFICIT

Likewise, Paulson predicted a pickup in job growth and business investment, before concluding: "All in all, I think we're all feeling better ... and we're optimistic that the president's economic programs are working."

In praising the administration's course, Paulson made no mention of the record budget deficit. Ed McKelvey, senior economist at Goldman Sachs, was widely quoted last year as warning that "the U.S. federal budget is out of control."

In other recent Wall Street reports, McKelvey has warned of the "difficulty of cutting the budget deficit" as Bush has pledged to do in his election-year budget.

Paulson's contributions last year included $15,000 to the National Republican Congressional Committee and $2,000 for Bush, a database search showed.

Commerce Secretary Don Evans brushed aside a question about the discrepancy between Paulson's public praise of the president and Goldman Sachs' market warnings. "We're going to cut the deficit in half in the next five years. ... (Bush is) absolutely committed to doing that," Evans said.

While acknowledging there was some discussion with the CEOs about the administration's decision to not renew tax breaks for business investment, Evans insisted: "They didn't ask for it (the tax breaks) to be extended."

He said everyone was in agreement that "the president's six-point (economic plan) is focused exactly were it needs to be focused."

Among the other major donors who attended the round-table: General Motors Corp.'s CEO Rick Wagoner and Marilyn Carlson Nelson of Carlson Cos. Both gave $2,000 to Bush according to the Center for Responsive Politics.

© Reuters 2004. All Rights Reserved.

http://www.reuters.com/newsArticle.jhtml?type=domesticNews&storyID=4329888