Analysis

The mystery of Steven Mnuchin

Goldman Sachs alumnus Steven Mnuchin is not particularly political, and his policy positions don't exactly jibe with GOP orthodoxy

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President Trump's supporters cheered his inaugural pledge "to make sure they share in the nation's riches," but his nominee for treasury secretary isn't exactly a populist hero, said Suzanne McGee at The Guardian. Steven Mnuchin, a Goldman Sachs alumnus and hedge fund manager with a net worth of as much as $500 million, is apparently so wealthy he forgot to disclose $100 million in assets ahead of his Senate confirmation hearing. Mnuchin also omitted the fact that he once led an offshore investment fund based in the Cayman Islands, a well-known tax haven. The revelations set the stage for a tense hearing, in which Democratic lawmakers raked Mnuchin over the coals for his leadership of California bank OneWest in the years after the financial crisis. The bank foreclosed on more than 36,000 homeowners during Mnuchin's tenure — including, famously, a 90-year-old woman who made a 27-cent payment error. Mnuchin has "a solid working knowledge of business and finance," but is he really the kind of person Trump supporters had in mind to run the nation's financial system?

Trump's economic team shows just how much the balance of power has shifted from Main Street to Wall Street, said Steven Pearlstein at The Washington Post. Gary Cohn, a former options trader who rose to second-in-command at Goldman Sachs, is the new director of the National Economic Council, which advises the president on economic policy matters. Legendary investor Carl Icahn, whose fortune is estimated at $20 billion, will also advise Trump on regulatory reform. Make no mistake: "These are smart, shrewd risk takers who know how to work the system and have a knack for buying low and selling high and driving hard bargains along the way." But Trump is simply replacing the Washington political elite he railed against "with the equally out-of-touch financial elites of Wall Street."

These are anything but your typical financiers, said Jessica Pressler at New York magazine. Most of Wall Street wrote off Trump, but what sets Mnuchin and his cohorts apart is that they "saw in the improbable candidate the opportunity for the deal of a lifetime." Backing Trump's White House run was a bet with little risk and a lot of potential upside — and now they are reaping the rewards. Mnuchin himself is described by colleagues as something of a "cipher," and not particularly political. His policy positions don't exactly jibe with Republican orthodoxy, said Larry Light at ​CBS News. In his Senate testimony, Mnuchin expressed support for the Volcker Rule, which prohibits banks from using their own accounts for risky investments and is despised by many in the GOP, and broke ranks with Trump by saying he supports a strong U.S. dollar. (Trump recently told The Wall Street Journal that the greenback is "too strong" and is hurting U.S. firms.) Mnuchin also rejects a Republican-backed plan to end government control of housing giants Fannie Mae and Freddie Mac. He may be a Washington outsider, but the putative treasury secretary appears to have what Beltway insiders prize most: "flexibility and nimbleness in his views."

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