Scott Bessent, the little-known Wall Street investor who became one of President-elect Donald Trump's top economic advisers, has been nominated to be the next treasury secretary in Trump's new administration.
In a statement, Trump wrote: "Scott has long been a strong advocate of the America First Agenda," and that Bessent would "help me usher in a new Golden Age for the United States, as we fortify our position as the World's leading Economy, Center of Innovation and Entrepreneurialism, Destination for Capital, while always, and without question, maintaining the U.S. Dollar as the Reserve Currency of the World."
Bessent, a former protégé of Democratic mega donor George Soros, founded and runs the hedge fund Key Square Group. He emerged from relative obscurity to become one of Trump's favorite advisers on the campaign trail, where Trump praised Bessent as "one of the top analysts on Wall Street" as well as "a nice-looking guy, too."
Bessent has returned the praise, arguing that Trump's proposed tax cuts and looser regulations on businesses will boost the U.S. economy.
"Mr. Trump has a mandate to reprivatize the U.S. economy through deregulation and tax reform," Bessent wrote in an op-ed for The Wall Street Journal, touting the stock market's immediate reaction to Trump's victory.
"That will be essential to restarting the American growth engine, reducing inflationary pressures, and addressing the debt burden from four years of reckless spending," he added.
Bessent sparked controversy with Fed comments
Bessent also made waves in policy circles this fall by floating the idea of replacing Federal Reserve chair Jerome Powell with a "shadow chair," who could undermine Powell's position until the end of his term in 2026.
The central bank is supposed to be independent and insulated from political pressures, but Trump has repeatedly criticized Powell — whom he appointed — for not doing his bidding.
Powell said after the election that he would not resign if Trump asks, and Bessent has decided the "shadow chair" idea isn't worth pursuing, The Wall Street Journal recently reported.
Close with Trump's orbit – and a Soros protégé
Bessent has been friends for years with Vice President-elect JD Vance, and with members of the Trump family.
But he spent years working for Soros, a billionaire investor firmly on the other side of the political aisle, eventually becoming chief investment officer of Soros Fund Management. (When Bessent left to start Key Square in 2015, Soros invested $2 billion with his former employee.)
If confirmed by the Senate, Bessent will become one of the first openly gay, Senate-confirmed Cabinet officials (following President Biden's Transportation Secretary Pete Buttigieg). Bessent and his husband, former New York City prosecutor John Freeman, have two children and live primarily in Charleston, S.C.
Tariffs and taxes could mark Bessent's tenure
As Treasury Secretary, Bessent will be responsible for implementing Trump's proposed economic policies, including tax cuts and sweeping tariffs.
During his first administration, Trump overhauled the tax code in 2017, with changes that are largely set to expire next year – meaning that his second administration will have an opportunity to again reshape tax policy for years to come.
Trump's promises to raise tariffs and cut taxes appeared to resonate with voters in this election, despite the currently healthy state of the U.S. economy: Inflation is easing, wages are rising, unemployment remains historically low, and interest rates are coming down.
The next Treasury Secretary will have to implement Trump's proposals without weakening the underlying fundamentals, but many economists have warned that Trump's economic proposals could restart inflation and balloon the federal deficit.
Copyright 2024 NPR
