Thursday :: May 15, 2014

Please Go Away Mr. Geithner


by Deacon Blues

When one looks back at the Obama presidency, the economic record will be one of missed opportunities caused by an over-reliance upon people more concerned about Wall Street than Main Street. People like Larry Summers and Tim Geithner, both of whom are directly to blame for the inadequate stimulus package, should never have been given the power they were given. For his part, Summers abdicated his responsibility as chair of the National Economic Council by failing to provide the new president with all three stimulus options that were prepared by the incoming team, withholding the largest proposal because he thought it was politically unfeasible when in fact we now know it was critical.

As for Geithner, among his many sins, he saw little to no benefit from an aggressive effort to deal with the mortgage debt overhang that fell upon millions of homeowners who immediately went underwater on their mortgages when the crash hit. To that end, it turns out that Geithner, according to his own book, was totally wrong about the economic benefit that could have accrued from a federal program aimed at reducing mortgage debts, a serious problem to this day that cripples the economy.

Presidents, like all political leaders are judged by those they surround themselves with. Obama will be judged as a mediocre president in this area, because he selected cabinet secretaries poorly, especially the Attorney General, at at Treasury, HHS, Defense, Vets Affairs, and Interior among others. Instead, he relied too much upon his White House staff and loyalists in both domestic and foreign policy, or deferred too much to people like Summers or Geithner to oversee a problem they were ill-equipped to confront.

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