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James T. Lynn, budget-cutter at OMB, dies at 83

By T. Rees Shapiro
Washington Post Staff Writer
Tuesday, December 7, 2010; 8:53 PM

James T. Lynn, a Harvard-educated lawyer who used his scalpel-sharp intellect to cut layers of redundancy and wasteful federal spending as director of the Office of Management and Budget before training his eye on the Aetna insurance company's bottom line as its president and chief executive, died Dec. 6 at an assisted living facility in Bethesda.

He was 83 and died of complications from a stroke, said his daughter, Marjorie Wilson.

In a 17-year career in the federal government, Mr. Lynn served as undersecretary in the Commerce Department and secretary of the Department of Housing and Urban Development under President Richard M. Nixon. He also was director of the Office of Management and Budget under President Gerald R. Ford.

His success in government service was widely attributed to his voracious appetite for work, a gregarious charm, an easy smile and an impressive intelligence that earned him the nickname Mr. Ultra-Bright.

Mr. Lynn was completely unsympathetic to government bureaucracy. To illustrate his penchant for simplification, Mr. Lynn created "mess charts" connecting federal overlap.

Referencing the noted abstract artist, he said the charts were so vivid they "might remind one of the works of Jackson Pollock."

Mr. Lynn, a Republican, was the Washington managing partner of the Cleveland-based Jones Day law firm when he met with officials from the Nixon administration to offer his services.

He became general counsel at the Commerce Department in 1970 and moved up to undersecretary a year later.

As HUD secretary from 1973 to 1975, Mr. Lynn helped formulate a landmark multi-billion-dollar community development and housing program that consolidated and improved existing federal subsidies for low- and moderate-income families.

He also helped create an anti-bias provision in the bill that outlawed racial and sexual discrimination in the way the federal funding was disbursed.

When the opportunity arose to lead the Office of Management and Budget in 1975, Mr. Lynn seized at the chance despite taking a significant pay cut and working with a much smaller staff.

"It's not sexy, but the sum total of the decisions have a very important impact on the future," Mr. Lynn told The Washington Post in 1976.

At one point, he advised President Ford on how to slash $28 billion from the federal budget, which pleased the commander-in-chief but earned him many enemies among heads of government agencies.

Mr. Lynn said he took the OMB position knowing the potential for generating ill will among government colleagues. "It's not the kind of job you would take if you want everyone to love you," he said.

When he retired from government service in 1977, Mr. Lynn purchased a sailboat and christened it "About Time."

James Thomas Lynn was born in Cleveland on Feb. 27, 1927. He was a 1948 honors graduate of what is now Case Western Reserve University. He was one of the top students at Harvard law, where he graduated in 1951, and then joined Jones Day.

At the law firm, he helped maneuver more than $1 billion worth of corporate mergers and, in 1961, became one of the youngest partners in Jones Day's history.

At office parties, he was known to entertain his colleagues on the piano and sang in a barbershop quartet alongside a promising young lawyer named Antonin Scalia, now a U.S. Supreme Court justice.

After government service, Mr. Lynn joined the Aetna board of directors in 1978. He was made the Hartford-based company's president and chief executive in 1984.

Many financial analysts praised the promotion but were critical of Mr. Lynn's lack of insurance experience and noted that he had never calculated a premium or sold a policy.

According to news stories at the time, Mr. Lynn helped stabilize Aetna's holdings by placing added emphasis on corporate insurance and getting out of several bad investments in the energy and technology fields that had been part of an unsuccessful diversification strategy.

To increase profit during a period of slow growth, Mr. Lynn oversaw an internal corporate reorganization that slashed 2,600 jobs - a total of 5 percent of the company. The decision was said to have saved Aetna $50 million.

He retired from Aetna in 1992.

Mr. Lynn also served on the boards of Kraft, Pfizer and TRW.

In the 1980s, he helped found the James S. Brady Presidential Foundation, which provided financial assistance and scholarships to victims of assassination attempts and their families.

Survivors include his wife of 56 years, Joan Miller Lynn of Bethesda; three children, Marjorie Wilson of Bethesda, J. Peter Lynn of San Diego and Sarah Hechler of North Potomac; and eight grandchildren.

As a ranking government official in the 1970s, Mr. Lynn traveled widely. He enjoyed telling the story of how, while in Moscow for an official Commerce Department assignment, he tried to outwit Soviet spies who had placed him under surveillance.

Mr. Lynn feared his hotel room had been bugged. One night, while lying in bed, he said to his empty room: "I sure wish they would put more strawberries and fewer peaches in my fruit basket tomorrow."

The next morning, his wish came true.

The following night he said: "It sure would be nice if we could have a car waiting for us in the morning."

The next day, a livery service had a car idling at the hotel's front doors.

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