‘Inept, incompetent, craven’: Scott Bessent struggles to clean up the president’s mess

History remembers Gen Dwight Eisenhower, the supreme commander of the allied forces in Europe during the second world war, for his role in the D-day invasion of Normandy. Whether Scott Bessent will achieve similar posterity as the face of the “economic D-day” in Iran remains to be seen.

The US treasury secretary, already trying to manage a $40tn national debt pile, this week took charge of Donald Trump’s effort to reverse-engineer his war of choice. Whereas the US would typically take on an adversary with diplomacy, sanctions and military force, in that order, the US president started with a six-month bombing campaign and now hopes that economic isolation can finish the job.

The effort shines a harsh spotlight on Bessent, a billionaire hedge fund manager and former Democratic donor who the president likes to say is “central casting” but critics warn is dangerously out of his depth. The coming months could reveal whether Bessent serves as a constraint on Trump’s worst impulses – or, in fact, enables them beneath a veneer of respectability.

“He is, bar none, the worst treasury secretary in the history of the United States,” said Steve Schmidt, a former political strategist for President George W Bush and the John McCain presidential campaign. “Because the first treasury secretary was a true genius, the distance between Alexander Hamilton and Bessent in evolutionary scale is the difference between a flea and a human being. He is inept, he is incompetent, he is dishonest, he is smug, he is craven.”

Scott Kenneth Homer Bessent is an unlikely avatar of the Make America Great Again (Maga) movement. Born in South Carolina, he made his way to Yale and graduated in 1984. Openly gay, in 2015 he told the Yale Alumni magazine: “If you had told me in 1984, when we graduated, and people were dying of Aids, that 30 years later I’d be legally married and we would have two children via surrogacy, I wouldn’t have believed you.”

Bessent went on to play an influential role in the liberal philanthropist George Soros’s London investment operations, including his famous 1992 bet against the pound, which generated huge profits on “Black Wednesday”, when the pound was delinked from European currencies.

He also donated to various Democratic causes in the early 2000s, notably Al Gore’s presidential run, but eventually drifted toward the Republican fold, transforming into an adviser and intellectual defender of Trump’s economic nationalism. He championed spending cuts while vigorously advocating for the extension of the tax cuts approved by Congress in Trump’s first term.

Still, in a cabinet of questionable qualifications, there were hopes that Bessent – an advocate for deficit reduction and deregulation – would prove a moderating influence on Trump. Last year the Senate confirmed him as treasury secretary by a vote of 68 to 29, with those in favour including some Democrats and independents. Bessent was hailed as the first openly gay treasury secretary in US history.

It has been far from smooth sailing. With the national debt ticking past $40tn, the bond markets have begun to rebel. Yields on long-dated treasury bonds have soared to heights not seen in nearly 20 years, dramatically escalating the cost of servicing the nation’s debt. Earlier this month, Bessent carried out the first joint intervention in the Japanese yen in 15 years to support currency stability.

Then, last week, he surprised global investors by announcing that the treasury would double the size of its quarterly buybacks of longer-dated bonds – boosting the repurchases of 10-to-30-year securities to at least $4bn per operation. Bessent claimed that his objective was to support liquidity in a thinly traded August market.

The market intervention achieved its goal, but only fleetingly. Yields dropped briefly before retracing nearly all of those losses by the end of the week. The core problem remained: Bessent has not identified the funding source for the buybacks, leading analysts to assume he will tap the Treasury General Account (TGA) at the Federal Reserve.

Perceptions of Bessent’s competence were shaken by the move. Charlie McElligott, a cross-asset strategist at Nomura, told the Financial Times newspaper that it was a “band-aid on a bullet hole” and would “not be enough to placate market forces”.

Bill Galston, a senior fellow at the Brookings Institution thinktank in Washington, summed it up: “The long bond buyback was perceived as somewhat farcical by the financial community, and when he went on to opine that we could grow our way out of the debt, I’m sure he knows better than that. I don’t think he’s thrown away his reputation but as headlines in the past 24 hours have been indicating, Wall Street, like Queen Victoria, is not amused.”

Then there was Iran. With a six month-bombing campaign having failed to break Tehran’s will, and the US running low on the defensive weapons it would need to repel a counterattack, Trump handed Bessent the unenviable task of finding another way. The upshot was “Operation Economic Outcast”, designed to isolate Iran from the global financial system.

Galston observed: “The president has decided on a strategy of maximum economic pressure. Bessent has no choice but to devise the best plan possible. Now, it does matter what he’s telling the president behind the scenes.”

At a press conference on Monday, Bessent’s rhetoric about “economic asphyxiation” was sweeping, but the reality was far more tentative: a series of warnings rather than the immediate imposition of secondary sanctions on Iran’s major trading partners.

If Bessent were to enforce secondary sanctions fully, he would have to target major Chinese state-owned banks. This could spark a catastrophic trade war between the world’s two biggest economies, shattering the fragile trade truce that Trump has spent the last year trying to maintain. “Why would I want to blow up the global financial system?” the secretary reasoned.

But to observers the lack of concrete penalties suggested a bluff. Larry Jacobs, director of the Center for the Study of Politics and Governance at the University of Minnesota, said: “His effort on the economic D-day appears to have been mostly rhetorical, not breaking any major new ground. At its core, what Bessent announced is an attempt to create an out for Donald Trump from the war he created and the mess that has resulted.”

He added: “Bessent is in the unenviable position of trying to make Trump’s whimsical preferences become reality and is repeatedly failing or making the situation worse.”

Meanwhile the president continues to be fixated on tariffs, which he often describes as his “favourite word”. Trump announced 50% tariffs on $20bn worth of Canadian goods over the weekend, after talks between the countries broke down. Canada retaliated by imposing retaliatory tariffs on $20bn worth of American goods including steel, dairy products, appliances and farm equipment.

There is little evidence that Bessent disapproves, or has sought to rein Trump in. Although he wrote an investor letter in 2024 arguing that tariffs were inflationary, Bessent said last year: “I’ve evolved on this. The president has been right.” He has also described tariffs as “a useful tool for achieving the president’s foreign policy objectives”, claiming that Hamilton was their original proponent.

Such remarks suggest that the former Democratic supporter now feels the zeal of the convert, and has become a true believer in Trump. Jacobs is not so sure. “We shouldn’t dismiss the possibility that it’s the attraction to power,” he said. “He’s got vast wealth but he’s now got a global standing that he’s never enjoyed before. But now that he is into the thick of a job you can see how ill prepared he is for a complicated situation with an out-of-control president.”

The price to pay, however, could be Bessent’s reputation. Kurt Bardella, a political commentator and former congressional aide, commented: “Bessent has zero credibility on the global stage and appears in over his head. On interest rates, the national debt, inflation, tariffs, he has mismanaged expectation and appears to be more preoccupied with being a yes-man to Trump than actually protecting the full faith and credit of the United States. At this point, the United States would be better off with an AI-bot running the treasury department than this blowhard.”