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PostPosted: Sun Mar 22, 2009 7:37 pm 
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President Obama’s claim that Timothy Geithner faces a more daunting set of challenges than any treasury secretary since Alexander Hamilton may be an exaggeration, but not by much. Geithner may indeed be the hardest-working man in Washington. But in order to survive, let alone succeed, he’s going to have to make a more convincing case that he’s part of the solution and not part of the problem.

The case of the appalling AIG bonuses—I was going to call them outrageous, but politicians and pundits have exhausted the nation’s supply of outrage since the payments were revealed—is just the latest situation to raise the inconvenient problem-versus-solution question about Geithner. Why didn’t he know about the bonuses earlier? And when he did get clued in, why didn’t he do anything to head off what was obviously going to be a distracting and perhaps damaging controversy?

A simpler way of asking the Geithner question is: Does he get it?

Does he understand the profound sense of betrayal that so many Americans feel as we learn that the supposed wizards of finance, the Masters of the Universe who shower themselves with unimaginable wealth, were safeguarding our economic well-being with the diligence and sobriety of a drunken high-roller at a craps table in Vegas at 4 a.m.? Does he understand that the crisis is not just an economic watershed but a cultural one as well, and that what once was deemed perfectly acceptable behavior on Wall Street is now seen as reprehensible? Does he understand that outside of Lower Manhattan, the definition of a “retention bonus” is being spared from the latest round of layoffs?

Geithner’s troubles began shortly after he was nominated for the Cabinet, when it was disclosed that he had failed to pay $34,000 in federal taxes between 2001 and 2004. It’s reasonable to expect the secretary of the treasury to have a record of faithfully paying his own taxes, and Geithner’s excuse—that he had used the computer software TurboTax to prepare his returns—didn’t sound likely to erase the scowl from an IRS auditor’s face. But Obama pushed hard for the nomination and the Senate went along, largely because Geithner was president of the Federal Reserve Bank of New York and had been deeply involved from the beginning in the effort to contain the financial meltdown. He was one of the few people who truly understood how and why things were falling apart.

Obama being so stubbornly loyal to Geithner reminds me of Bush's resistance to the call for Donald Rumsfeld to resign. While I think Obama himself is doing a reasonably good job, considering all that he's inherited from the Bush years, Tim Geithner is becoming an albatross around his neck.


"Behind every great fortune lies a great crime."
Honore de Balzac

"Democrats work to help people who need help.
That other party, they work for people who don't need help.
That's all there is to it."

~Harry S. Truman

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