WASHINGTON – President Bush on Wednesday asked embattled Treasury Secretary John Snow to stay on the job in the new administration, stunning the nation’s capital, where rumors were rife that Snow would soon join the long line of secretaries leaving Bush’s Cabinet.

Separately, Anthony Principi is stepping down as secretary of Veterans Affairs, a senior administration official said Wednesday. Principi becomes the ninth of 15 Cabinet members to depart.

But Snow’s retention ended the last big question about Bush’s second-term Cabinet. Snow agreed to stay after a 15-minute meeting with Bush in the Oval Office, White House press secretary Scott McClellan said.

“The president is pleased Secretary Snow agreed to continue to serve,” McClellan said. “We have a strong economic team.”

The announcement ended speculation that Snow, 65, a Bush loyalist and former chief of CSX railroad, would be ditched in favor of someone better able to push Bush’s second-term agenda of revamping Social Security and overhauling the tax code.

The announcement also ended an aggressive behind-the-scenes lobbying campaign by pro-Snow conservatives after unidentified White House aides repeatedly leaked word to the news media that Snow would be pushed out.

“It was a freelance leaker seeking to start a forest fire and it failed,” said Grover Norquist, the president of Americans for Tax Reform, an anti-tax group with close ties to the White House. “Why it wasn’t shut down (by the White House) the day after, I don’t know. But all’s well that ends well. Snow is a tremendous asset.”

“We worked the phones, made media appearances, called the White House, called Capitol Hill,” said Stephen Moore, president of the Club for Growth, a conservative pressure group with influence on economic affairs. “We talked to folks in the (White House) political office, (Karl) Rove’s office. I think the White House might have gotten spooked about alienating conservatives.”

Before Wednesday, Snow appeared to be Washington’s equivalent of a dead man walking. The Washington Post quoted an unidentified senior administration official nine days ago as saying that Snow could stay in the Treasury job as long as he wanted, provided it wasn’t very long.

That was widely taken as a direct signal for Snow to resign. When he didn’t, shortly afterwards The New York Times wrote that Snow was all but out, spawning intense public discussion of who would replace him.

Speculation was rampant that Snow would be succeeded by White House Chief of Staff Andrew Card, former Sen. Phil Gramm, R-Texas, or a Wall Street giant such as Goldman Sachs chief executive Hank Paulson. Card denied vigorously Tuesday that he was interested in the job.

The White House did little to quell the rumors. Administration officials said last week that Defense Secretary Donald Rumsfeld would return for Bush’s second term, but they stopped well short of that when asked about Snow’s fate. Asked Tuesday if Snow would stay on, McClellan said only that “we appreciate the great job that Secretary Snow is doing.”

McClellan said Wednesday that administration officials bucked Snow up privately as the rumor mill churned.

“When some of the rumors were floating in the media, Andy Card spoke with him on a couple of occasions and told him not to pay attention to them,” McClellan said. He said Bush simply hadn’t had a chance to confer with Snow before Wednesday.

As to where the rumors began, White House officials and Snow’s supporters say they don’t know.

“I have not gotten any sense that people in the administration are unhappy with him,” Norquist said Tuesday. “He’s been loyal. He’s been competent. He’s been good. There’s not a wing of the (Republican) party that’s unhappy with him.”

But Moore said there are some people in Washington and the financial world who may have wanted Snow out because they thought he lacked star power and had less than stellar oratory skills.

And he’s made some gaffes.

During a visit to job-strapped Ohio during the presidential campaign, Snow said that outsourcing jobs to other countries was simply how the global trading system worked – a remark that was economically accurate but politically insensitive.

“A couple of people were out to get John Snow,” Moore said. “He’s not the glitziest guy in the world, and some people wanted glitz and prestige. Is he the most telegenic guy around? No. Is he a gifted speaker? No. But he gets the job done.”