"The fault, dear Brutus, is not in our stars, but in ourselves"--Julius Caesar, Act I, ii.
But for his personal tax problems, Tim Geithner would have been a consensus choice of Wall Street for Treasury Secretary last fall. As President of the New York Federal Reserve, he knew all the bankers on Wall Street. He was not only intimately involved with the bank bailouts, he now appears to have been the bankers' lapdog. He speaks fluent Chinese, helpful since China holds a huge amount of US debt obligations. Just months into the financial meltdown, avoiding Wall Street caterwauling about the Treasury Secretary-designate may have been a reasonable consideration for the incoming Administration faced with unprecedented calamities from 8 years of George W.
Yet, from the outset, Mr. Geithner's appointment compromised the Obama Administration-to-be's credibility on ethics. In order not to lose its first key approval, the President-elect had to swallow-hard and excuse his failure to pay social security taxes. That ethics problem was then compounded by Tom Daschle's failure to pay his taxes forced withdrawal of his nomination to be Health & Human Services Secretary.
Geithner survived the Senate approval process in part because he was the first that needed a 'bye' on ethics and in part because his combination of skills and experience were considered indispensable in the time of severe instability.
Nonetheless, even before the disclosure of his pro-bank lax handling of bailout funds while at the New York Federal Reserve, Geithner had become a lightning rod for the Administration's economic policies that coddled Wall Street. To be fair, and unlike Rumsfeld, Geithner has had some real successes--such as preventing total economic collapse with the stimulus plan, and stabilizing the financial system.
But Geithner, like Larry Summers inside the White House, has failed to respond to main street's needs directly and powerfully, and failed to stand up to Wall Street interests when they are inimical to sustained stability. Whether it was home foreclosures, or credit card reform, or financial reform, the measures were compromises rather than strong policy prescriptions. It has taken a popular website, www.breakupthebigbanks.com, and Senators such as Dorgan and Sanders, and House members such as Kanjorski, to push the issue of breaking up the big banks so they can never hurt us again.
President Obama should learn from all of George W's mistakes including his continued support of Donald Rumsfeld. Many Republicans(!) believe that they might not have lost the 2006 Congressional elections if Bush had fired Rumsfeld before, instead of after, election day.
The Treasury Secretary has become a continuing liability for this President. By stepping down, Geithner can rightly claim some successes, and provide the President an opportunity to appoint a Treasury Secretary that not only does not have ties to Wall Street, but also who has a history of championing main street.
Former Labor Secretary Robert Reich would be a superb choice. For a Treasury Secretary to have previously served as Labor Secretary would itself send a very strong message to main street that this Administration is "on their side" as Presidential election campaign suggested. Reich is eminently qualified for the position--he is a student and author about long-term economic trends, and is an economic policy-wonk.
Go to www.BreakUpTheBigBanks.com, sign the petition, and show your support for breaking Wall Street's stranglehold on Washington DC and your future.