Bessent’s political turn in convention speech tests his credibility

Treasury Secretary Scott Bessent’s push to calm the bond market is colliding with a more political role, as his planned Republican convention speech raises questions about the credibility he needs to manage U.S. debt markets.

Bessent’s prime-time speech at the Republicans’ midterm convention in Dallas on Wednesday will mark the first time in 50 years that a sitting Treasury secretary has spoken at a national political convention. The Dallas meeting is the first time the GOP has 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 tremendous power but for the market credibility of the Treasury secretary,” said Stephen Myrow, managing partner of Beacon Policy Advisors, and a former advisor to Treasury Secretary Hank Paulson. The Treasury Department can’t print money, unlike the Federal Reserve.

Bessent is the last government official due to speak before Trump, sandwiched between U.S. House candidates from Arizona and Michigan and a woman billed on the convention agenda as an “everyday American, working mother and economic policy advocate.”

His speech will come against the backdrop of the Treasury Department on Wednesday saying it would buy back as much as $6 billion in long-term Treasury debt this week, with a cap of at least $4 billion in operations later this year. The department began the buyback program in 2024 to solve a well-documented problem where trading can be thin for some long-term debt. 

But the 64-year-old former hedge fund trader has described those operations in broader terms. There was a “fever that was building,” in the markets, Bessent said at an event Tuesday organized by conservative news organization Breitbart. He said he acted to stem that. 

That intervention worked at first after Bessent announced enhanced buybacks on Aug. 19. The news, which prompted Treasury yields to fall, came after days of headlines worrying about a global sell-off in government bonds.

But the effect was short-lived. Yields on long-term Treasury debt rose Wednesday after the department disclosed the size of the buybacks, which had been anticipated. The 10-year Treasury note yielded 4.84% mid-afternoon Wednesday, higher than any point of Trump’s term. Higher yields on Treasury debt can help savers who can earn income from holding debt, but it can squeeze borrowers who face higher costs for new mortgages and auto loans.

The Treasury secretary’s role in helping to manage the vast, vital market for government debt makes the position particularly sensitive within the Cabinet. The Treasury secretary has played a critical role in stabilizing the economy during market crises, such as the 2007-2008 financial crisis or the 2020 pandemic. 

Although all Cabinet officials are political actors to a degree — they report to and are appointed by the elected president…