Jack Lew, the nominee for U.S. Treasury secretary, emphasized his ability to work across party lines as he tried to win over Republican senators who were focusing on his work at Citigroup Inc. and an investment in the Cayman Islands.
Lew, selected by President Barack Obama last month to succeed Timothy F. Geithner, testified at his confirmation hearing before the Senate Finance Committee in Washington today. He said he paid all the taxes owed on the Cayman investment, which lost money.
“I have reached across the aisle to forge honorable compromises my entire professional life,” he said. “The things that divide Washington right now are not as insurmountable as they might look.”
Lew, 57, is Obama’s former chief of staff and was director of the Office of Management and Budget under both Obama and President Bill Clinton. He said the country needs “balanced” deficit reduction that includes more revenue and changes to entitlement programs. It’s that combination of taxes and spending that Republicans reject.
“We’ll be counting on your deep experience to help us achieve comprehensive tax reform,” Finance Committee Chairman Max Baucus, a Democrat from Montana, said during the hearing. Baucus has said previously that he sees no reason why Lew shouldn’t be confirmed.
Citigroup Work
Senator Orrin Hatch of Utah, the top Republican on the Finance Committee, focused on Lew’s time working at Citigroup Inc. and questioned whether Lew could work as the chairman of the Financial Stability Oversight Council as it oversees the so- called Volcker Rule designed to separate proprietary trading from traditional banking.
“If you were to be confirmed, it could lead to an awkward situation in which, in your role as chair of the FSOC, you would effectively be saying to financial firms: ‘Do as I say, not as I did,’ ” Hatch said, adding that Lew was “well-compensated” at Citigroup. “These are not trivial matters. Indeed, they bear directly on your qualifications.”
Lew worked as a Citigroup executive from 2006 before joining the Obama administration at the State Department in 2009. His tenure at New York-based Citigroup overlapped with the U.S. government’s $45 billion bailout during the 2008 global crisis. Citigroup later repaid the government funds.
Bond Funds