David Stockman | |
|---|---|
 Stockman in 2017 | |
| 25th Director of theOffice of Management and Budget | |
| In office January 27, 1981 – August 1, 1985 | |
| President | Ronald Reagan |
| Preceded by | Jim McIntyre |
| Succeeded by | Jim Miller |
| Member of theU.S. House of Representatives fromMichigan's4th district | |
| In office January 3, 1977 – January 27, 1981 | |
| Preceded by | Edward Hutchinson |
| Succeeded by | Mark Siljander |
| Personal details | |
| Born | David Alan Stockman (1946-11-10)November 10, 1946 (age 79) |
| Party | Republican |
| Education | Michigan State University (BA) Harvard University |
| Website | Official website |
David Alan Stockman (born November 10, 1946) is an American politician and former businessman who was aRepublicanU.S. Representative from the state ofMichigan (1977–1981) and the Director of theOffice of Management and Budget (1981–1985) under PresidentRonald Reagan.
Stockman was born inFort Hood, Texas, the son of Allen Stockman, a fruit farmer, and Carol (née Bartz).[1] He is of German descent, and his family's surname was originally "Stockmann".[2] He was raised in a conservative family inSt. Joseph, Michigan; his maternal grandfather, William Bartz, was a Republican treasurer ofBerrien County, Michigan for 30 years.[3][4] Stockman was educated at public schools inStevensville, Michigan. He graduated fromLakeshore High School in 1964[5] and received aBA in History fromMichigan State Universityin 1968[citation needed]. He was a graduate theology student atHarvard University from 1968 until he left the university after 1969.[4]
He served as special assistant toUnited States Representative and 1980 U.S. presidential candidateJohn Anderson ofIllinois, 1970–1972, and was executive director,United States House of RepresentativesRepublican Conference, 1972–1975.
In 1976, Stockman was elected fromMichigan's 4th congressional district (inSouthwest Michigan) to theHouse of Representatives for the95th Congress. He was reelected in the two subsequent elections. In total, he served in the House from January 3, 1977, until his resignation on January 21, 1981, to accept appointment as Director of theOffice of Management and Budget forPresidentRonald Reagan.[6]
Stockman was one of the most controversial OMB directors ever appointed, also known as the "Father ofReaganomics." Committed to the doctrine ofsupply-side economics, he assisted in the passing of the "Reagan Budget" (theGramm-Latta Budget), which Stockman hoped would curtail the "welfare state". He thus gained a reputation as a tough negotiator with House SpeakerTip O'Neill's Democratic-controlled House of Representatives and Majority LeaderHoward Baker's Republican-controlledSenate. During this period, Stockman became well known to the public during the contentious political wrangling concerning the role of the federal government in American society.
Stockman's influence within the Reagan Administration was weakened after theAtlantic Monthly magazine published the infamous 18,246-word article, "The Education of David Stockman",[7] in its December 1981 issue, based on lengthy interviews Stockman gave to reporterWilliam Greider.
Stockman was quoted as referring to Reagan's tax act in these terms: "I mean,Kemp-Roth [Reagan's 1981 tax cut] was always a Trojan horse to bring down the top rate.... It's kind of hard to sell 'trickle down.' So the supply-side formula was the only way to get a tax policy that was really 'trickle down.' Supply-side is 'trickle-down' theory."[7] Of the budget process during his first year on the job, Stockman was quoted as saying, "None of us really understands what's going on with all these numbers," which was used as the subtitle of the article.[7]
After "being taken to the woodshed by the president"[8] because of his candor with Greider, Stockman became concerned with the projected trend of increasingly large federaldeficits and the rapidly expandingnational debt. On August 1, 1985, he resigned from OMB and later wrote a memoir of his experience in the Reagan Administration titledThe Triumph of Politics: Why the Reagan Revolution Failed in which he specifically criticized the failure of congressional Republicans to endorse a reduction of government spending to offset large tax decreases to avoid the creation of large deficits and an increasing national debt.
President Jimmy Carter's last fiscal year budget ended with a $79.0 billion budget deficit (and a national debt of $907.7 billion as of September 30, 1980),[9] ending during the period of David Stockman's and Ronald Reagan's first year in office, on October 1, 1981.[10] The gross federal national debt had just increased to $1.0 trillion during October 1981 ($998 billion on September 30, 1981, up from $907.7 billion during the last full fiscal year of the Carter administration).[9]
By September 30, 1985, four and a half years into the Reagan administration and shortly after Stockman's resignation from the OMB during August 1985, the gross federal debt was $1.8 trillion.[9] Stockman's OMB work within the administration during 1981 until August 1985 was dedicated to negotiating with the Senate and House about the next fiscal year's budget, executed later during the autumn of 1985, which resulted in the national debt becoming $2.1 trillion at fiscal year end September 30, 1986.[9]
In 1981, Stockman received the Samuel S. Beard Award for Greatest Public Service by an Individual 35 Years or Under, an award given out annually byJefferson Awards.[11]
After leaving government, Stockman joined the Wall St. investment bankSalomon Brothers and later became a partner of the New York–based private equity company, theBlackstone Group.[12] His record was mixed at Blackstone, with some very good investments, such as American Axle, but also failures, including Haynes International and Republic Technologies.[12] During 1999, after Blackstone CEOStephen A. Schwarzman curtailed Stockman's role in managing the investments he had developed,[12]: 146 Stockman resigned from Blackstone to start his own private equity fund company,Heartland Industrial Partners, L.P., based inGreenwich, Connecticut.[13]
On the strength of his investment record at Blackstone, Stockman and his partners raised $1.3 billion of equity from institutional and other investors. With Stockman's guidance, Heartland used a contrarian investment strategy, buying controlling interests in companies operating in sectors of the U.S. economy that were attracting the least amount of new equity: auto parts and textiles. With the help of about $9 billion inWall Street debt financing, Heartland completed more than 20 transactions in less than 2 years to create four portfolio companies:Springs Industries,Metaldyne,Collins & Aikman, and TriMas. Several major investments performed very poorly, however. Collins & Aikman filed for bankruptcy during 2005 and when Heartland sold Metaldyne to Asahi Tec Corp. during 2006, Heartland lost most of the $340 million of equity it had invested in the business.[14]
During August 2003, Stockman became CEO ofCollins & Aikman Corporation, a Detroit-based manufacturer of automotive interior components. He was ousted from that job days before Collins & Aikman filed for bankruptcy under Chapter 11 on May 17, 2005.
On March 26, 2007, federal prosecutors in Manhattan indicted Stockman in "a scheme... to defraud [Collins & Aikman]'s investors, banks and creditors by manipulating C&A's reported revenues and earnings." TheUnited States Securities and Exchange Commission also brought civil charges against Stockman related to actions that he performed while CEO of Collins & Aikman.[15] Stockman suffered a personal financial loss, over $13 million, along with losses suffered by as many as 15,000 Collins & Aikman employees worldwide.
Stockman said in a statement posted on his law firm's website that the company's end was the consequence of an industry decline, not due to fraud.[16] On January 9, 2009, the US Attorney's Office announced that it would discontinue prosecution of Stockman for this case.[17]
Stockman lives on theUpper East Side ofManhattan.[13] He is married to Jennifer Blei Stockman and is the father of two children, Rachel and Victoria. Jennifer Blei Stockman is a chairwoman emerita of theRepublican Majority for Choice,[18] and president of theSolomon R. Guggenheim Foundation Board of Trustees.[19] In 2013, Stockman signed anamicus brief to theSupreme Court in favor ofsame-sex marriage.[20] In 2018, Stockman criticized the U.S.interventionist foreign policy.[21] He serves on the board of directors of theCommittee for a Responsible Federal Budget.[22]
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Upon emerging from the lunch, Stockman told reporters he had been taken 'to the woodshed' – a reference to punishment meted out during his youth on his parents' Michigan farm.
| U.S. House of Representatives | ||
|---|---|---|
| Preceded by | Member of theU.S. House of Representatives fromMichigan's 4th congressional district 1977–1981 | Succeeded by |
| Political offices | ||
| Preceded by | Director of theOffice of Management and Budget 1981–1985 | Succeeded by |
| U.S. order of precedence (ceremonial) | ||
| Preceded byas Former U.S. Representative | Order of precedence of the United States as Former U.S. Representative | Succeeded byas Former U.S. Representative |
