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Treasury's O'Neill faces the heat

O'Neill made the rounds of the Sunday interview shows.
O'Neill made the rounds of the Sunday interview shows.  


From Kelly Wallace
CNN Washington Bureau

WASHINGTON (CNN) -- U.S. Treasury Secretary Paul O'Neill, who has faced criticism for continuing a trip to Central Asia as the U.S. stock market started to dive, made the rounds on the Sunday morning interview programs, rejecting any suggestion he could be doing more to calm the markets.

"I don't think one individual can say words that will cause the market to go one direction or another for any sustained period of time," O'Neill said on CBS's "Face the Nation."

During a short session with reporters following the interview, O'Neill laughed off questions about whether he might resign.

Asked earlier on NBC's "Meet the Press" whether he might step down, the embattled treasury secretary said, "I'm going to keep working on the fundamentals ... because that's what I think I'm supposed to do. And the spectators can say whatever they will."

O'Neill received a great deal of criticism for continuing a trip to the former Soviet republics when the market significantly dropped nearly two weeks ago.

He said his trip, which included visits to Kyrgyzstan and Uzbekistan, was important for national security reasons and that he was able to monitor continuously all developments from overseas.

"I was only gone a few days," O'Neill said on NBC. "I'm interested that people don't somehow understand, with all the telecommunications capability that we've got now, it's possible to be constantly in touch."

He denied reports the White House asked him to postpone his trip this week to South America.

He said he made the decision not to push back the trip because senators will be in Washington wrapping up work on legislation before the month-long August recess.

O'Neill has been the target of critics who believe President Bush has a strong national security team but argue it's a different story when it comes to his economic advisers.

"I think the Bush administration is suffering from an economic leadership deficit," said Sen. Joseph Lieberman, D-Connecticut.

The White House dismisses such criticism, calling it the typical Washington blame game.

But aware of their critics and concerned about sagging consumer confidence, the president's economic advisers, in addition to O'Neill, took part in a full court press this weekend, all armed with the same message.

"The economic fundamentals of our society are good," O'Neill told NBC.

"The long term for America is fabulous," said White House economic adviser Lawrence Lindsey on ABC's "This Week."

"The economy is doing well," Commerce Secretary Donald Evans said on CNN's "Novak, Hunt & Shields."

The Bush strategy is to talk up the economy and to talk tough about corporate wrongdoers, such as calling attention to the highly publicized arrests last week of Adelphia Communications executives and warning that other corporate leaders could suffer the same fate.

"I think we're going to have more people going to jail," Lindsey said on ABC. When Lindsey was pressed to name those who might be going to jail, he said, "No. I can't do that."

Bush plans to convene what the administration is calling an "economic forum" August 13 in Waco, Texas.

It will come shortly after he begins a month-long stay at his ranch in nearby Crawford and one day before a Securities and Exchange Commission deadline for nearly 1,000 companies to certify their earnings reports are correct.

White House aides hope the earnings reports, combined with the president signing into law this week a tough corporate accountability measure, will calm jittery investors.

They are well aware that if these and other steps don't boost consumer confidence, the president's party could be hurt the most in the November congressional elections.

Even before the signing ceremony, however, some analysts warned that the new law, which calls for tougher accounting standards and criminal penalties for corporate leaders who knowingly mislead investors, is likely to have little impact on the mood of investors.

"It's hard for me to read the investors' minds, but I don't think the passage of that legislation was a big factor in changing investors' opinions about the future," John Bogle, founder of the Vanguard Group, told "Fox News Sunday."

"I think investors' confidence has been shattered, and it's going to take a lot more than some congressional action to rebuild it."