Treasury Secretary Scott Bessent’s efforts to calm the bond market are clashing with his more political role. His upcoming speech to the Republican convention casts doubt on his credibility to manage the U.S. bond market.
Bessent’s prime-time speech at the Republican midterm convention in Dallas on Wednesday will be the first time in 50 years that a sitting Treasury secretary has addressed a national political convention. The Dallas conference will be the first time Republicans have held a midterm convention. But the principles that have kept Treasury secretaries off the national convention stage since Treasury Secretary William E. Simon spoke at the Republican National Convention in 1976 are the same.
“Treasury generally doesn’t have a lot of power other than the secretary’s credibility in the marketplace,” said Stephen Myrow, managing partner at Beacon Policy Advisors and a former adviser to Treasury Secretary Hank Paulson. The Treasury, unlike the Federal Reserve, cannot print money.
Bessent is the last senior administration official scheduled to speak before Trump, sandwiched between candidates for the U.S. House of Representatives in Arizona and Michigan and a woman listed on the convention’s agenda as an “ordinary American, a working mother, and a champion of economic policy.”
His speech comes as the Treasury Department announced on Wednesday that it would buy back up to $6 billion in long-term government bonds this week, capping operations by at least $4 billion this year. The department launched a buyback program in 2024 to resolve a well-documented problem that could lead to thinning of some long-term debt deals.
But the 64-year-old former hedge fund trader described these operations in broader terms. “The heat is running high” in the market, Bessent said at an event hosted by conservative news outlet Breitbart on Tuesday. He said he acted to stop it.
The intervention initially worked after Mr. Bessent announced on August 19 that he would step up share buybacks. The news prompted a drop in U.S. bond yields after days of headlines worrying about a decline in global government debt.
However, the effect was short-lived. Long-term Treasury yields rose on Wednesday after the ministry revealed the size of its expected share buybacks. of 10 year Treasury bill The yield as of mid-afternoon Wednesday was 4.84%, higher than at any point during Trump’s presidency. Rising yields on Treasury bonds will help savers who earn income by holding debt, but could pressure borrowers who face higher costs on new mortgages and auto loans.
The Treasury Secretary’s role in helping manage the vast and important government debt market makes his position within the Cabinet particularly sensitive. The Treasury Secretary has played a key role in stabilizing the economy during market crises, such as the 2007-2008 financial crisis and the 2020 pandemic.
Although all cabinet ministers are political actors to some degree – they report to and are appointed by the elected president – some Treasury secretaries are careful to avoid overt politics.
“I was never asked to speak at an overtly political event, and I was careful not to violate the Hatch Act,” former Treasury Secretary Janet Yellen said, referring to the law that restricts political activity for most executive branch employees. She served under President Joe Biden until Trump took office in 2025.
The 1939 law places certain restrictions on the involvement of certain executive branch officials in partisan politics, but political activity is permitted in some cases as long as the official does not use his or her office or public resources. “Other Biden appointees also spoke at political events, adhering to these rules,” Yellen said.
Other Treasury secretaries are also participating in the political convention. Treasury Secretary James Baker appeared on video at the 1988 Republican National Convention. He resigned on that date to lead George H.W. Bush’s presidential campaign. Robert Rubin spoke at the 2000 Democratic National Convention, a year after he resigned as Secretary of the Treasury in President Bill Clinton’s administration.
Bessent has actively used his public profile to go after the administration’s political opponents.
“Sometimes I say I feel like an emergency room doctor,” Bessent said at a Breitbart event Tuesday. “The Biden economy was just like Americans being hit by a truck,” Bessent said, but workers have fared much better under the Trump administration. He said the bottom 25% of earners saw higher wage increases than the top 25%.
The Treasury Department did not respond to a request for comment on the political nature of Bessent’s speech Thursday. He brushed off questions about his political ambitions beyond his current job.
Mr. Bessent is from South Carolina, the home state of the late Republican Sen. Lindsey Graham. Bessent told Southern Methodist University students Tuesday that he responded to the call following Graham’s sudden death in July.
“They said, ‘Oh, you should run for his seat,’ and I said, ‘You know, we have one boss right now who is very demanding. We don’t need 5.5 million South Carolinians to be our boss,'” Bessent said.
Mr. Bessent is not a natural orator. His speaking style can sometimes seem awkward and tends to slip into economic jargon.
Nevertheless, Mr. Bessent has risen to the top of an administration in which the president constantly evaluates the loyalty of his subordinates and the aggressiveness of their policy advocacy.
“We don’t have a typical traditional president, so we can’t expect to have a traditional Treasury secretary,” Maillot said.
But if markets don’t trust Bessent, perhaps because they see him as putting politics first, Mayrow said Bessent could find himself in a downward spiral of escalating demands from the president and weakening his effectiveness.
“The real value that Mr. Bessent has over Mr. Trump is his credibility in the market,” Mr. Mailloux said. “If he loses enough market confidence, he will burn out the value he provides to Trump and the country.”
—Steve Liesman contributed to this report.
Correction: This article has been corrected to reflect that Treasury Secretary James Baker resigned in 1988 to run George H.W. Bush’s presidential campaign. A previous version incorrectly identified presidential candidates.
