LEARNING FROM PAUL O’NEILL

Brickbats started flying as soon as former Treasury Secretary Paul O’Neill’s book came out. Anyone who breaks ranks in such a disciplined organization as the current Bush administration must expect backlash. Sour grapes, some critics said. Of course he was sore about being fired. Some complained that he didn’t write the book himself, as if he had invented the as-told-to genre.

The author of “The Price of Loyalty: George W. Bush, the White House, and the Education of Paul O’Neill” is a former Wall Street Journal senior reporter, Ron Suskind, a Pulitzer Prize winner. He relied on Mr. O’Neill’s prodigious memory, his 7,630-entry diary of his nearly two years in office, 19,000 copies of official documents that had crossed his desk, hundreds of hours of interviews with other officials, and, above all, Mr. O’Neill’s “striking view of the value of secrecy – that it had almost no value.” The result is a unique inside look at how the administration operates and how it reached major decisions on tax cuts, wars, global warming and energy policy.

His first disillusionment came even before the inauguration. He was astonished to learn from The Associated Press that Karl Rove and other White House political advisers had scheduled a two-day economic forum of business leaders and economists with himself as the centerpiece. What bothered him most was that the group would include mostly CEOs who had supported the Bush campaign and a few selected economists.

He got nowhere when he urged a real discussion with diverse opinions and various schools of economic thinking.

Ten days after the inauguration, at the first meeting of the National Security Council, President Bush suggested disengaging from the Arab-Israeli conflict and then turned to Condoleezza Rice, his national security adviser: “So, Condi, what are we going to talk about today? What’s on the agenda?” She was ready, in what the book says several observers understood was a scripted exchange: “How Iraq is destabilizing the region, Mr. President.” It quickly became apparent that the question about war with Iraq was not why or whether but how and when.

Soon he watched in dismay as Vice President Dick Cheney’s energy policy task force took shape, relying mainly on industrial supporters and largely ignoring environmentalist and conservationist groups. He and Environmental Protection Agency Administrator Christine Whitman tried in vain to discuss the pros and cons of regulating carbon dioxide and other greenhouse gases, but the president said the policy on climate change had already been decided.

Mr. O’Neill’s biggest disappointment was over the massive Bush tax cut. He and Federal Reserve Board Chairman Alan Greenspan had kept raising concerns about the vanishing budget surplus. They urged “triggers” that would have automatically limited tax reduction if necessary to avoid a return to deficit financing. One of their questions was where to get the $1 trillion needed to finance a favorite Bush proposal to let younger workers put their Social Security benefits into private investment accounts – a project about to return.

The White House wanted no limits on its tax cut, and the end of the triggers plan came with the 50-to-49 defeat of an amendment offered by Sens. Olympia Snowe and Evan Bayh of Indiana, with Sen. Susan Collins among the co-sponsors. It would have delayed the scheduled cuts and new spending programs if targets for reduction of the national debt were not met.

The Bush administration enters its final year of the term trying to bring peace and democracy to Iraq while managing an economy that is on the rise but remains burdened with job losses and deep budget deficits. It does so without a Treasury secretary who says he was the one asking the hard questions.