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==Early life and family==
==Early life and family==
Born in [[Palm Beach, Florida]], to Marianna Gallauer and Henry Merritt Paulson, a wholesale jeweler.<ref>
He was born in [[Palm Beach, Florida]], to Marianna Gallauer and Henry Merritt Paulson, a wholesale jeweler.<ref>
{{cite web
{{cite web
|url=http://freepages.genealogy.rootsweb.com/~battle/celeb/paulson.htm
|url=http://freepages.genealogy.rootsweb.com/~battle/celeb/paulson.htm

Revision as of 10:03, 27 January 2009

Henry M. Paulson
74th United States Secretary of the Treasury
In office
July 3, 2006 – January 20, 2009
PresidentGeorge W. Bush
Preceded byJohn W. Snow
Succeeded byTimothy Geithner
Personal details
Born (1946-03-28) March 28, 1946 (age 78)
Palm Beach, Florida
Political partyRepublican (United States)
SpouseWendy Paulson
ChildrenHenry Merritt Paulson III
Amanda Clark Paulson
Alma materDartmouth College, Harvard University
ProfessionInvestment banker
Signature

Henry Merritt "Hank" Paulson Jr. (born March 28, 1946) was the 74th United States Treasury Secretary and is a member of the International Monetary Fund Board of Governors. He previously served as the Chairman and Chief Executive Officer of Goldman Sachs. In 2008, Time magazine named Paulson as a runner-up for its Person of the Year 2008.

Early life and family

He was born in Palm Beach, Florida, to Marianna Gallauer and Henry Merritt Paulson, a wholesale jeweler.[1] He was raised in Barrington Hills, Illinois as a Christian Scientist.[2] Paulson attained the rank of Eagle Scout in the Boy Scouts of America.[3][4]

A star athlete at Barrington High School, Paulson was a champion wrestler and stand-out football player, graduating in 1964. Paulson received his Bachelor of Arts in English from Dartmouth College in 1968;[5] at Dartmouth he was a member of Phi Beta Kappa and Sigma Alpha Epsilon and he was an All Ivy, All East, and honorable mention All American as an offensive lineman.

He met his wife Wendy during his senior year. The couple have two adult children, Henry Merritt III and Amanda Clark, and became grandparents in June 2007. They maintain homes in Washington, DC and Barrington Hills, Illinois.

In 1970 Paulson received a Master of Business Administration degree from Harvard Business School.[6]

Early career

Paulson was Staff Assistant to the Assistant Secretary of Defense at The Pentagon from 1970 to 1972.[7] He then worked for the administration of U.S. President Richard Nixon, serving as assistant to John Ehrlichman from 1972 to 1973, during the events of the Watergate scandal for which Ehrlichman was convicted, and sentenced to prison.

Goldman Sachs

He joined Goldman Sachs in 1974, working in the firm's Chicago office under James P. Gorter. He became a partner in 1982. From 1983 until 1988, Paulson led the Investment Banking group for the Midwest Region, and became managing partner of the Chicago office in 1988. From 1990 to November 1994, he was co-head of Investment Banking, then, Chief Operating Officer from December 1994 to June 1998;[8] eventually succeeding Jon Corzine (now Governor of New Jersey) as its chief executive. His compensation package, according to reports, was US $37 million in 2005, and US $16.4 million projected for 2006.[9] His net worth has been estimated at over US $700 million.[9] Paulson has personally built close relations with China during his career. In July 2008 it was reported by The Daily Telegraph that: "Treasury Secretary Hank Paulson has intimate relations with the Chinese elite, dating from his days at Goldman Sachs when he visited the country more than 70 times."[10]

In 2004, at the request of the major Wall Street investment houses, including Goldman Sachs, then headed by Paulson, the U.S. Securities and Exchange Commission agreed unanimously to release the major investment houses from the net capital rule, the requirement that their brokerages hold reserve capital that limited their leverage and risk exposure. The complaint that was put forth by the investment banks was of increasingly onerous regulatory requirements -- in this case, not U.S. regulator oversight, but European Union regulation of the foreign operations of US investment groups. In the immediate lead-up to the decision, EU regulators also acceded to US pressure, and agreed not to scrutinize foreign firms' reserve holdings if the SEC agreed to do so instead. The 1999 Gramm-Leach-Bliley Act, however, put the parent holding company of each of the big American brokerages beyond SEC oversight. In order for the agreement to go ahead, the investment banks lobbied for a decision that would allow "voluntary" inspection of their parent and subsidiary holdings by the SEC.

During this repeal of the net capital rule, SEC Chairman William H. Donaldson agreed to the establishment of a risk management office that would monitor signs of future problems. This office was eventually dismantled by Chairman Christopher Cox, after discussions with Paulson. According to the New York Times, "While other financial regulatory agencies criticized a blueprint by Mr. Paulson, the Treasury secretary, that proposed to reduce their stature — and that of the S.E.C. — Mr. Cox did not challenge the plan, leaving it to three former Democratic and Republican commission chairmen to complain that the blueprint would neuter the agency."[11] In late September 2008, Chairman Cox and the other Commissioners agreed to end the 2004 program of voluntary regulation.

U.S. Secretary of the Treasury

Paulson (right) with President George W. Bush as his nomination to become Treasury Secretary is announced.

Paulson was nominated by U.S. President George W. Bush to succeed John Snow as the Treasury Secretary on May 30, 2006.[12] On June 28, 2006, he was confirmed by the United States Senate to serve in the position.[13] Paulson was officially sworn in at a ceremony held at the Treasury Department on the morning of July 10, 2006.

Paulson's three immediate predecessors as CEO of Goldman Sachs — Jon Corzine, Stephen Friedman, and Robert Rubin — each left the company to serve in government: Corzine as a U.S. Senator (later Governor of New Jersey), Friedman as chairman of the National Economic Council (later chairman of the President's Foreign Intelligence Advisory Board) under President George W. Bush, and Rubin as both chairman of the NEC and later Treasury Secretary under President Bill Clinton.[14]

Paulson identified the wide gap between the richest and poorest Americans as an issue on his list of the country's four major long-term economic issues to be addressed, highlighting the issue in one of his first public appearances as Secretary of Treasury.[15]

Paulson conceded that chances were slim for agreeing on a method to reform Social Security financing, but said he would keep trying to find bipartisan support for it.[16]

He also helped to create the Hope Now Alliance to help struggling homeowners during the subprime mortgage crisis.[17]

Notable statements

In Spring 2007, Secretary Paulson told an audience at the Shanghai Futures Exchange that "An open, competitive, and liberalized financial market can effectively allocate scarce resources in a manner that promotes stability and prosperity far better than governmental intervention."[18]

In August 2007, Secretary Paulson explained that U.S. subprime mortgage fallout remained largely contained due to the strongest global economy in decades.[19]

On July 20, 2008, after the failure of Indymac Bank, Paulson reassured the public by saying, “it's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation.”[20]

On August 10, 2008, Secretary Paulson told NBC’s Meet the Press that he had no plans to inject any capital into Fannie Mae or Freddie Mac.[21] On September 7, 2008, both Fannie Mae and Freddie Mac went into conservatorship.[22]

U.S. government economic bailout of 2008

Paulson was the designated leader of the Bush administration's efforts in 2008 to nationalize the cost of bad loans made by financial institutions.

Through unprecedented intervention by the U.S. Treasury, Paulson led government efforts which he said were aimed at avoiding a severe economic slowdown. He pushed through the conservatorship of government agency mortgage giants Fannie Mae and Freddie Mac. Working with Federal Reserve Chairman Ben Bernanke, he influenced the decision to create a credit facility (bridge loan & warrants) of US$85 billion to American International Group so it would avoid filing bankruptcy.

In late September 2008, Paulson, along with Federal Reserve Chairman Ben Bernanke, led the effort to help financial firms by agreeing to use US$700 billion dollars to purchase bad debt they had incurred.[23] He incurred criticism from economists for initially refusing to consider injecting large amounts of cash into financial institutions directly by purchasing stock, an option which other countries in similar circumstances have pursued.[24] This was the option favored by Federal Reserve Chairman Bernanke, and one that was eventually followed. [25]

On September 19, 2008, Paulson called for the U.S. government to use hundreds of billions of Treasury dollars to help financial firms cleanup nonperforming mortgages that threaten the liquidity of those firms.[26] Due to his leadership and public appearances on this issue, the press labeled these measures the "Paulson financial rescue plan" or simply the Paulson Plan.[27]

With the passage of H.R. 1424, he became the manager of the United States Emergency Economic Stabilization fund.

Paulson also sits on the newly established Financial Stability Oversight Board that oversees the Troubled Assets Relief Program

Conflict of interest claims

It has been pointed out that Paulson's plan could potentially have some conflicts of interest, since Paulson is the former CEO of Goldman Sachs, a firm that may benefit largely from the plan.[28] Paulson has no direct financial interest in Goldman, however, since he sold his entire stake in the firm prior to becoming Treasury Secretary, pursuant to ethics law.[29] The sale was tax-free and netted near $200,000,000 in tax benefits to Mr Paulson, questioning the motives of his joining the government. [30] Despite this, opponents argue that Paulson remains a Wall Street insider and still maintains close friendships with higher-ups of the bailout beneficiaries. The proposed bill would give the United States Treasury Secretary unprecedented powers over the economic and financial life of the U.S. Section 8 of Paulson’s original plan stated: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."[31]. For that reason, many bloggers refer to Mr. Paulson as "King Henry." [32] After the passage of this bill, the press has recently reported that the Treasury is now proposing to use these funds ($700 billion) in ways other than was originally intended in the bill.[33].

Civic activities

Paulson has been described as an avid nature lover.[34] He has been a member of The Nature Conservancy for decades and was the organization's board chairman and co-chair of its Asia-Pacific Council.[7] In that capacity, Paulson worked with former President of the People's Republic of China Jiang Zemin to preserve the Tiger Leaping Gorge in Yunnan province.

Paulson is also on the Board of Directors of the Peregrine Fund; was the founding Chairman of the Advisory Board of the School of Economics and Management of Tsinghua University in Beijing; and, previously served as chairman of the influential trade group, the Financial Services Forum.

Notable among the members of Bush's cabinet, Paulson has said he is a strong believer in the effect of human activity on global warming and advocates immediate action to decrease this effect.[35]

As an environmental leader and philanthropist, Paulson while at Goldman Sachs, oversaw the corporate donation of 680,000 acres (2,800 km2) forested on the Chilean side of Tierra del Fuego, which led to criticisms from Goldman shareholder groups[36]. He further donated US$100 million of assets from his wealth to conservancy causes. He pledged his entire fortune for the same purpose at death.[37] He has also been considered someone who can influence world and business leaders to think beyond the bottom line.[38]

References

  1. ^ Battle, Robert (2006-08-23). "untitled". Ancestries of Miscellaneous "Celebrities". Ancestry.com. Retrieved 2008-10-11. {{cite web}}: Cite has empty unknown parameters: |accessdaymonth=, |accessyear=, |month=, |accessmonthday=, and |coauthors= (help)
  2. ^ Patricia Sellers, Hank Paulson's secret life, The CEO of Goldman Sachs is passionate about banking. But he's also obsessed with snakes, tarantulas, and coral reefs., Public Broadcasting Service, "Wall Street Week with Fortune" feature, December 29, 2003.
  3. ^ Townley, Alvin. Legacy of Honor: The Values and Influence of America's Eagle Scouts. New York: St. Martin's Press. pp. 178–188, 196. ISBN 0-312-36653-1. Retrieved 2006-12-29. {{cite book}}: Cite has empty unknown parameter: |coauthors= (help); Unknown parameter |origdate= ignored (|orig-date= suggested) (help)
  4. ^ Ray, Mark (2007). "What It Means to Be an Eagle Scout". Scouting Magazine. Boy Scouts of America. Retrieved 2007-01-05. {{cite web}}: Cite has empty unknown parameter: |coauthors= (help)
  5. ^ Belser, Alex (May 31, 2006). "Paulson '68 to lead Treasury". The Dartmouth.
  6. ^ "02138 § Henry Paulson". 02138 - The World of Harvard. Retrieved 2008-10-11. HBS ... MBA 1970 {{cite web}}: Cite has empty unknown parameters: |accessdaymonth=, |month=, |accessyear=, |accessmonthday=, and |coauthors= (help)
  7. ^ a b The Nature Conservancy (2006). Henry M. Paulson, Jr..
  8. ^ Goldman Sachs (2006). Goldman Sachs Group, Inc - Management.
  9. ^ a b Forbes (2006). Henry M. Paulson, Jr..
  10. ^ US faces global funding crisis, warns Merrill Lynch - Telegraph
  11. ^ "Stephen Labaton, "Agency’s ’04 Rule Let Banks Pile Up New Debt" New York Times, October 2, 2008
  12. ^ White House (2006). President Bush Nominates Henry Paulson as Treasury Secretary. Retrieved June 29, 2006.
  13. ^ Associated Press (2006). Senate Approves Paulson as Treasury Secretary.
  14. ^ White House (2006).President Commends Senate for Confirming Henry Paulson as Treasury Secretary. Retrieved June 29, 2006.
  15. ^ The Christian Science Monitor August 3, 2006 New Treasury head eyes rising inequality. Retrieved August 3, 2006.
  16. ^ "Paulson: Social Security Reform Hopes Slim". Reuters, February 3, 2007.
  17. ^ "HOPE NOW Alliance Created to Help Distressed Homeowners" (PDF) (Press release). Hope Now Alliance. 2007-10-10. Retrieved 2008-09-24.
  18. ^ "China Shuns Paulson's Free Market Push as Meltdown Burns U.S." Bloomberg.com. 2008-09-24. Retrieved 2008-09-25.
  19. ^ Lawder, David (August 1, 2007), "Paulson sees subprime woes contained", The Boston Globe
  20. ^ "Treasury Secretary Insists Banks Are Safe". CBS News. 2008-07-20. Retrieved 2008-09-23.
  21. ^ Brinsley, John (August 10, 2008). "Paulson Says No Plans to Add Cash to Fannie, Freddie". Bloomsberg Worldwide. Retrieved 2008-09-23.
  22. ^ Lockhart, James B., III (2008-09-07). "Statement of FHFA Director James B. Lockhart". Federal Housing Finance Agency. Retrieved 2008-09-23.{{cite news}}: CS1 maint: multiple names: authors list (link)
  23. ^ Joelle Tessler, Paulson oversees historic government intervention, Associated Press, 2008-09-19
  24. ^ Krugman, Paul, 'Gordon Does Good', New York Times, Oct 12, 2008
  25. ^ Muolo, Paul. $700 Billion Bailout The Emergency Economic Stabilization Act and What It Means to You, Your Money, Your Mortgage and Your Taxes. New York: John Wiley and Sons. p. 23. ISBN 978-0-470-46256-0.
  26. ^ Sahadi, Jeanne (2008-09-19). "Rescue cost: Hundreds of billions". CNNMoney.com. {{cite news}}: Cite has empty unknown parameter: |coauthors= (help)
  27. ^ ""Paulson plan"". Google News search.
  28. ^ Herbert, Bob (2008-09-22). "A Second Opinion?". The New York Times. Retrieved 2008-10-10. {{cite web}}: Check date values in: |date= (help); Italic or bold markup not allowed in: |publisher= (help)
  29. ^ White, Ben (2008-09-19). "Details of a Rescue Plan Are Unclear, but Some Already Benefit". The New York Times. Retrieved 2008-10-10. {{cite web}}: Check date values in: |date= (help); Italic or bold markup not allowed in: |publisher= (help)
  30. ^ http://www.theracetothebottom.org/executive-comp/henry-paulson-and-government-service-the-ultimate-tax-shelte.html
  31. ^ Beck, Rachel (2008-09-23). "Transparency key to bailout success". Associated Press. Retrieved 2008-09-23. {{cite news}}: Cite has empty unknown parameter: |coauthors= (help)
  32. ^ http://seekingalpha.com/article/105843-king-henry-paulson-s-personal-fiefdom
  33. ^ Dunbar, John (2008-10-25). "Uses for $700 billion bailout money ever shifting". Associated Press. Retrieved 2008-10-25. {{cite news}}: Cite has empty unknown parameter: |coauthors= (help)
  34. ^ Somerville, Glenn (May 30, 2006). "Paulson brings Wall Street luster to Treasury". Yahoo! News.
  35. ^ Heilprin, John (June 2, 2006). "A global warming believer in Bush Cabinet". Associated Press.
  36. ^ Treasury Nominee Hank Paulson Needs to Answer Some Questions, Human Events, 2006-06-13
  37. ^ Paulson plans to donate £410m fortune to environmental causes, The Independent, 2004-01-16
  38. ^ Mark Brandon. Environmental Cred for Bush Treasury Nominee, Sustainable Log (Blogspot)

Further reading

Wikimedia Commons has media related to Henry Paulson.
Business positions
Preceded by Chairman and CEO, Goldman Sachs
June 1998 – July 3, 2006 		Succeeded by
Political offices

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