Paulson’s No-Show Irks Dodd

Treasury Secretary Henry Paulson on Monday requested and received permission to skip a Tuesday appearance before the Senate Banking Committee — but is going ahead with an afternoon speech at the Brookings Institution, irritating Banking Committee Chairman Chris Dodd (D-Conn.)

Paulson was supposed to speak before Dodd’s committee about last weekend’s federal takeover of Fannie Mae and Freddie Mac, but asked Dodd to cancel the hearing after Monday’s meltdown in the U.S. financial markets.

When Dodd’s office later learned of Paulson’s planned appearance at Brookings, they issued this statement: “It is regrettable that the Secretary has said he is too engaged in the current crisis to come before the Congress, yet is available to give speeches on the same day he was scheduled to testify. Chairman Dodd intends to reschedule this hearing at the earliest opportunity and to continue to aggressively exercise the Committee’s oversight functions.”

Earlier, Dodd had announced Tuesday’s hearing was being cancelled but signaled he still wanted answers from the Bush administration.

“The economic crisis facing our country is deepening, as we saw over the weekend with the failure of Lehman Brothers and the sale of Merrill Lynch. To fully understand the implications of these events, we need to learn more about the Administration’s involvement, and its plans going forward,” Dodd said. “The Banking Committee has played a vital role both in revealing the pattern of lax regulatory oversight that helped to create this financial crisis, and in addressing related economic problems by crafting comprehensive legislation passed earlier this year. As Chairman, I will continue to work on solutions to help Americans weather this storm, including strengthening the housing sector, developing a second stimulus package, and restructuring the regulation of the financial sector.”

Dodd and Paulson already have some differences. In a conference call last Monday with reporters, Dodd expressed anger that the Treasury secretary had kept him uninformed of the administration’s impending takeover of Fannie Mae and Freddie Mac. The senator reminded reporters that Paulson himself had told the Banking Committee earlier this summer that such steps were unlikely.

–J. Taylor Rushing