Bush Appoints Rail Chief to Put Us Economy Back on Track

President George Bush sought yesterday to sharpen up his handling of the wobbly US economy by bringing in rail executive John Snow to head his treasury team.

After forcing the resignation of his gaffe-prone treasury secretary, Paul O'Neill, and economic adviser, Larry Lindsey, last Friday, amid growing doubts about the health of the economy, Mr Bush hopes Mr Snow, 63, will bring fresh impetus to his plans to nurse it back to health.

"John Snow has excelled as a business leader, an expert on economic policy, an academic and as a public servant," Mr Bush said. "He'll be a superb member of my cabinet."

Mr Snow is currently president, chief executive and chairman of the rail freight giant CSX, which earned around $20m last year.

Many observers were surprised that Mr Bush had opted for the little-known corporate boss, who, like his predecessor Mr O'Neill, served in the 1970s Ford administration, in which he was deputy undersecretary for transportation.

But with a PhD in economics under his belt, Mr Snow is expected to provide a more measured approach than Mr O'Neill, whose off-the-cuff remarks frequently caused consternation in the markets.

There has also been speculation that the change of personnel could herald a loosening of Washington's "strong dollar policy", in an attempt to boost economic growth.

With unemployment at 6%, and growing concern in the financial markets about the pace of recovery, the Bush administration is eager to get the US economy back on track ahead of the next presidential elections in 2004.

The president is determined to avoid the fate of his father, who led the US and its allies to victory in the last Gulf war, but lost the subsequent election amid criticism that he had failed to develop a strong domestic policy.

Mr Bush said the new treasury secretary would be at the heart of his efforts to restore the world's largest economy to growth - a sideswipe at Mr O'Neill, who clashed with the administration on the need for tax cuts and was viewed as the wrong man to sell the package to Congress.

"I'll be proposing specific steps to increase the momentum of our economic recovery," the president said. "And the treasury secretary will be at the centre of this effort. He will be a key advocate of my administration's agenda for growth."

Mr Snow, whose appointment must be confirmed by the Senate, said he would pursue a "pro-growth and pro-jobs agenda". He has been a critic of the financial scandals that have bruised Wall Street.

Opposition Democrats seized on the shake-up as evidence that White House economic policies are not working. Tom Daschle, Senate Democratic leader, said of Mr Snow's nomination: "It isn't the names, but the plan that is of concern to us. Trickle-down."