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Wall Street investors Scott Bessent and Howard Lutnick are the leading contenders to be Donald Trump’s Treasury secretary after hedge fund billionaire John Paulson dropped out of the race for the job.
Paulson said on Tuesday that his “complex financial obligations would prevent” him from entering the administration “at this time” but he would continue advising Trump’s economic team.
“I’m ecstatic that President Trump will be back in office,” he wrote. “He is off to a fast start with his appointments, and his policies will have an immensely positive impact on all Americans.”
News of the withdrawal leaves Bessent, a former chief investment officer at George Soros’s family office, and Cantor Fitzgerald chief executive Lutnick, who is also co-chair of the Trump transition team, in pole position to compete for the job.
Both have been spotted around Palm Beach and Mar-a-Lago, Trump’s Florida home and resort, since the former president won a convincing election victory last week.
Trump has moved quickly to fill the pivotal posts in his administration, including appointing a national security adviser and nominating a secretary of interior, but several top jobs remain, including that of Treasury secretary, the new government’s most significant economy position.
Paulson emerged as a Trump Treasury candidate earlier this year but told the Financial Times in September that it was “not so easy” for him to unwind his significant holdings.
He had been a big money-raker for Trump, including earlier this year hosting a fundraiser at his Palm Beach home, which the Trump campaign said raised more than $50mn.
Bessent, chief of Key Square Capital Management, appeared on rightwing ideologue Steve Bannon’s podcast “War Room” on Tuesday and floated cutting government spending by $1tn over the next decade. Trump confidant Elon Musk has called for even deeper cuts to the federal budget.
“I think if we could get $100bn a year over 10 years that scores at $1tn in this cockamamie CBO scoring that’ll stabilise the bond market and we can go from there,” said Bessent, referring to the Congressional Budget Office. “It’s an incredible opportunity.”
Bessent said “the really insidious part” of the Biden agenda was not necessarily taxes but the “regulatory burden”. He called for “a big push in bank deregulation”, saying “community banks need to be allowed to lend to their communities”.
He also remarked upon the state of the overall economy, saying that rich people and big companies have done well, while the bottom half of wage earners have gotten “crushed”.
“I’m a Wall Street guy who loves Main Street,” said Bessent. “Main Street has to drive this Trump boom.”
One former Republican congressional aide said Bessent’s candidacy could face resistance from some of those close to Trump because of his past work for Soros. The aide also claimed that Bessent was more devoted to pro-business deregulation than to the president-elect’s plans for sweeping tariffs.
“My general view is that at the end of the day, he’s a free trader,” Bessent told the FT last month, referring to Trump. “It’s escalate to de-escalate.”
Additional reporting from James Politi in Washington