Treasury Secretary Henry Paulson is in the midst of a reluctant about-face of his economic principles. The Los Angeles Times looks at how Paulson—a former chief executive at Goldman Sachs with a long history of faith in laissez-faire capitalism—has had to become the point man for the Bush administration's decidedly hands-on approach to fixing the nation's economic troubles.
“He's a man who came in with one agenda and is having another one forced upon him by circumstances," said one banker. "He’s in full defense mode at this point.” Paulson’s actions include underwriting JPMorgan’s purchase of Bear Stearns and last week’s proposal to Congress to prop up Fannie and Freddie. He’s even backed Ben Bernanke’s request for increased regulation of investment banks. The question now is how Paulson will react if the economy develops new, deeper problems.