Treasury Secretary Snow Resigns

Published May 30, 2006 at 9:12 AM EDT

WASHINGTON (AP) -- Treasury Secretary John Snow resigned Tuesday and President Bush nominated Goldman Sachs Chairman Henry M. Paulson Jr. as his replacement - another chapter in the shake-up to revive Bush's troubled presidency.

"He has a lifetime of business experience. He has intimate knowledge of financial markets and an ability to explain economic issues in clear terms," Bush said of Paulson in a Rose Garden announcement.

He praised Snow for showing "strong leadership" at Treasury.

Paulson called the U.S. economy "truly a marvel, but we cannot take it for granted. We must take steps to maintain our competitive edge in the world."

Snow, the former head of railroad giant CSX Corp. who has a Ph.D. in economics, has been Treasury secretary since February 2003. His departure has been rumored for more than a year.

Paulson has been chairman of Goldman Sachs for about eight years. It is considered one of the premier financial firms on Wall Street and has sent a number of its top executives to high positions in Washington.

Robert Rubin, one of Paulson's predecessors, served as Treasury secretary in the Clinton administration, and Jon Corzine, another Goldman Sachs chairman, served as a U.S. senator from New Jersey and is now governor of that state.

The Senate must confirm Paulson for the post. The Senate Banking Committee is expected to act swiftly on Paulson's nomination, a spokesman for the panel said.

Sen. Chuck Schumer, D-N.Y., a member of the Senate Finance Committee, said he talked to Paulson on Tuesday morning and praised Bush's selection to be the new Treasury secretary.

"His experience, intelligence and deep understanding of national and global economic issues make him the best pick America could have hoped for," Schumer said. The senator said he would support the nomination.

Welcoming Paulson to the Cabinet, Bush praised the economy under his own watch. "The American economy is powerful, productive and prosperous, and I look forward to working with Hank Paulson to keep it that way."

Snow, who has called Paulson "a very able executive, a friend of mine," thanked Bush for his time in the Cabinet and said he looked forward to private life.