A few weeks ago on OTB Radio, Dave Schuler predicted that Timothy Geithner would be out as Treasury Secretary by the end of the year. At the rate he’s going, he might not last to summer.
It’s bad enough his every public appearance causes the Dow to plummet. Now, he’s been openly contradicted by his boss on the AIG creating what NYT correspondent Jackie Calmes has dubbed “perhaps the worst week in a string of bad weeks for the Treasury secretary.”
Mr. Geithner’s once-heralded credentials with Wall Street were already marred by false starts in revamping the Bush administration’s bank rescue program, even as his perceived closeness to financiers — he is the former president of the Federal Reserve Bank of New York — and unease with populist politics left Main Street skeptical.
On Wednesday, a junior Republican in Congress and some traders on Wall Street went so far as to call for him to quit or be fired. The Republican leader of the House, Representative John A. Boehner of Ohio, told a conservative talk-radio host that the secretary is “on thin ice.”
But Mr. Geithner’s boss, the president, interjected a vote of “complete confidence.”
Which is Washington speak for “I haven’t fired him yet.”
And, it turns out, Treasury knew about the AIG bonuses days earlier than we’d been led to believe (albeit not nearly as long as the Fed knew.)
Already, Politico has a “Can Geithner Bounce Back?” story.
If Geithner is to survive, Democrats, analysts and even experts in crisis public relations say the Obama White House must find some way to improve the public image of a man who is becoming closely identified in the public mind with the ugly side of the Wall Street bailouts, including the controversy over AIG’s use of taxpayer money to pay $165 million in bonuses to top executives.
Put it this way: Obama’s made clear he’s not getting rid of Geithner. Now he needs a game plan for an urgent rehabilitation — which imagemeisters say will likely mean throwing Geithner a life raft by keeping him out of the limelight, giving him a more aggressive policy stance to sell and even filling out his depleted ranks at Treasury.
The problem is that there’s nothing in Obama’s short history in public life to indicate that he’s willing to spend that much energy — indeed, any energy at all — to prop up an associate who’s creating a distraction. Jeremiah Wright — gone. Samantha Power — gone. (That one happened so fast it didn’t merit a second post. She is, to be fair, quietly back.) Jim Johnson — gone. Bill Richardson — gone. Nancy Killefer — gone. Tom Daschle — gone. Rodgin Cohen, Chas Freeman, and Annette Nazareth — gone.
Indeed, the only notably exception was Geithner and the flap over his failure to pay taxes. But that’s not a storm he had to weather long and it was obvious that Geithner would nonetheless be easily confirmed under the circumstances. If Geithner continues to be an obstacle to Obama’s agenda, he’ll soon be — gone.
Photo: Reuters Pictures
Update (Steve Verdon): I think this part is important,
And, it turns out, Treasury knew about the AIG bonuses days earlier than we’d been led to believe (albeit not nearly as long as the Fed knew.)
Lets not forget where Secretary Geithner came from: The Federal Reserve. Further, as head of the New York Federal Reserve he was likely very involved in the AIG matter. The idea that he was caught flat footed on this strains credulity to the breaking point, for me at least. Geithner has been involved in all of these bailouts for months. His work spans both the Obama Administration and the Bush Administration, and he was picked by President Obama. The idea that this can all be blamed on Bush is just not believable either. I think that if Geithner makes it to August it will be surprising at this point.
Oh, can anyone check the In-Trade contract on Geithner’s demise as Secretary of Treasury and post it in comments?
