Geithner On Ousting CEOs, Reviving Economy

By: Stephen Smith
Topics: Economic Stimulus

(AP Photo/Susan Walsh)

Days after GM's CEO Rick Wagoner was forced out by the Obama administration, Treasury Secretary Timothy Geithner left open the possibility that such moves could happen again.

In an interview with CBS Evening News anchor Katie Couric, Geithner acknowledged the government has had to do "exceptional things" – citing AIG as well as Fannie Mae and Freddie Mac.

"We have changed management aboard," he said. "And where we've done that, we've done it because we thought that was necessary to make sure these institutions emerge stronger in the future."

Watch full version of Katie Couric's interview with Treasury Secretary Timothy Geithner:

When asked if he would leave open the option to pressure a bank CEO to resign, Geithner replied: "Of course."

In a separate interview with ABC News, Geithner said there was no difference in the way the administration has handled the auto and finance industries.

As world leaders convene in London to address the global economic crisis, an increasingly confident Geithner predicted the "strongest coordinated global response" in generations would help revive the world's fractured economy.

Citing initial commitments given by other countries, he said he was confident that broken financial systems would be fixed by growing trade and ensuring markets are expanding.

"You're gonna see the strongest consensus on coordinated global stimulus you've seen in generations," he said. "A very powerful consensus on the kind of 21st century rules of the road for our financial systems."

Geithner acknowledged the enormity of the crisis but said a unified effort would help reverse the financial downturn.

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"We're gonna have setbacks ahead," he said. "And that's why it's so important that we're moving together with the world to try to make sure we bring recovery back. And the world is with the president on this."

Geithner also skirted criticism that the Treasury Department still has no mechanism for tracking how banks have spent billions of dollars in TARP money, saying the doled out dollars were showing immediate results.

"Interest rates are now at historic lows … for mortgages," he said. "Millions of Americans are now able to refinance and take advantage of those interest rates. That's gonna reduce monthly payments very materially for millions of Americans."

Stephen Smith
Stephen Smith is a news producer and sports editor for CBSNews.com

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by JayinNC April 5, 2009 11:54 PM EDT: Would anybody like to share their thoughts on why we are not bringing some jobs back home? When is Obama going to bring some jobs back home. I know because of a global economy he can? bring all jobs back home, but when are we going to start making things like ball bearings in the US again? We need new jobs besides energy jobs Why are we not taxing American and foreign companies on things they make overseas. We should!

An example is GM?s recent CEO and the execs that are making tons of money buying up shares of stock of overseas car companies and imports, and refusing to make good American made quality products because its expensive labor. Tax overseas imports so it costs the same to make that car here as there , and GM wil be forced to make good American cars. A Saturn car hybrid that gets 25 intown and 34 highway is ridicuous. Make a Saturn hybrid that gets 30 in town and 45 highway and then we can talk GM. Don?t stop global imports, just put a good tariff on them. Place technology before politics and pocket lining. The county with deep pockets , good business and work ethics, and the state of the art technology rules the world.; Reply to this comment


by t_barr April 5, 2009 8:01 PM EDT: Interesting;
US watchdog calls for bank executives to be sacked
James Doran in New York
www.guardian.co.uk/business/2009/apr/05/useconomy-regulators

Elizabeth Warren, chief watchdog of America's $700bn (£472bn) bank bailout plan, will this week call for the removal of top executives from Citigroup, AIG and other institutions that have received government funds in a damning report that will question the administration's approach to saving the financial system from collapse.

Warren, a Harvard law professor and chair of the congressional oversight committee monitoring the government's Troubled Asset Relief Program (Tarp), is also set to call for shareholders in those institutions to be "wiped out". "It is crucial for these things to happen," she said. "Japan tried to avoid them and just offered subsidy with little or no consequences for management or equity investors, and this is why Japan suffered a lost decade." She declined to give more detail but confirmed that she would refer to insurance group AIG, which has received $173bn in bailout money, and banking giant Citigroup, which has had $45bn in funds and more than $316bn of loan guarantees.

Warren also believes there are "dangers inherent" in the approach taken by treasury secretary Tim Geithner, who she says has offered "open-ended subsidies" to some of the world's biggest financial institutions without adequately weighing potential pitfalls. "We want to ensure that the treasury gives the public an alternative approach," she said, adding that she was worried that banks would not recover while they were being fed subsidies. "When are they going to say, enough?" she said.

She said she did not want to be too hard on Geithner but that he must address the issues in the report. "The very notion that anyone would infuse money into a financially troubled entity without demanding changes in management is preposterous."

The report will also look at how earlier crises were overcome - the Swedish and Japanese problems of the 1990s, the US savings and loan crisis of the 1980s and the 30s Depression. "Three things had to happen," Warren said. "Firstly, the banks must have confidence that the valuation of the troubled assets in question is accurate; then the management of the institutions receiving subsidies from the government must be replaced; and thirdly, the equity investors are always wiped out."; Reply to this comment


by babooph April 4, 2009 8:30 PM EDT: A govt. worker can bankrupt a company for 1/100 the price of a pvt ceo-no?; Reply to this comment


by burrdeming April 4, 2009 10:16 AM EDT: I believe President Bush demanded and got the resignations of the CEOs of AIG, Fannie Mae, and Freddie Mac before those too-big-to-fail entities got any bailout money.

I suspect Rick Wagoner was simply rolled up, stuffed into a cannon, and fired across the bow of other recipients of bailout dollars <a href="http://www.FairAndUNbalanced.com?http://www.testimoanials.com/blog/blog1.php/2009/03/31/general-motors-one-two-three">as a warning shot</a>.; Reply to this comment


by credibility2 April 3, 2009 7:35 PM EDT: I hope the hyena jackals will vigorously voice their vitriol and disgust over the bonuses both Freddie and Fannie will be doling out, which presumably will exceed anything AIG did. If nothing is said by our illustrious Congressional hacks, including the president, well, let's just say that sanctimonious hypocrisy is more than alive and well. And to those who still whine and moan about the luxury retreats some of these companies took after receiving bailout money, be warned: why aren't you whining and moaning about the Dem luxury retreat in late January, which the president attended, where it's been widely reported that the taxpayers were stuck footing the bill for; ironically, the Repubs had a simililar one, but donations and lobbyists paid for nearly their entire bill. And, lastly, with public hypocritical outrage and angst against some companies that were going to have luxury retreats and some of the companies backed down out of public self-righteous indignation, many of these companies had to spend hundreds of thousands of dollars in early termination penalties just to cancel; either way, the taxpayer bailout still had to fund the cancellation fees.; Reply to this comment


by swin5 April 3, 2009 1:10 PM EDT: Just a reminder, Tim, April 15 is coming up in 12 days - don't forget.; Reply to this comment


by sjc_1 April 3, 2009 12:21 PM EDT: "Geithner said there was no difference in the way the administration has handled the auto and finance industries."

I beg to differ on this point. They give GM $17 billion and fire the board and CEO. They give AIG $170 billion and they get massage retreats and $140 million in bonuses. I see a difference here.; Reply to this comment


by danbry82 April 3, 2009 5:00 AM EDT: I forgot to mention the most important part --

Once the list of MSM contacts is gathered and big enough the plan is to contact MSM reporters and anchors , explain what their job is, and explain in CLEAR terms that they will be boycotted if they don't start asking the right questions.

The plan also includes contacting EVERY advertiser of every news program. Gather that information too. Contact them as well and let them know we will NOT buy their products if they do not support our questions on MSM.

Then once EVERYONE knows about this PLAN , if the government is too afraid to give news interviews, THE SHEEPLE WILL KNOW WHY. AND WILL VOTE THEM **out** . Which is what DEMOCRACY AND FREEDOM OF SPEECH IS ABOUT.

Rise up, people of the United STATES of America. Rise up and PREPARE NOW --- build this system to replace every irresponsible politician in the House and Senate A.S.A.P.

Educate EVERYONE YOU KNOW. Today.; Reply to this comment


by danbry82 April 3, 2009 4:48 AM EDT: It's probably too late, folks. The majority of Americans have allowed themselves to become ignorant or uneducated (through watching stupid TV and listening to stupid radio)and therefore have NO idea what is coming up. And if you try to explain, they don't believe.

All they believe in is the gov-provided services that amount to socialism. And they voted for Obama.

Now keep in mind that the Repubs are just as damaging to the USA. The Bush II admin set us up for this failure intentionally. Iraq? Come on. Trillions? Printing money and housing bubble? Come on. It's no wonder we are in pain and looking for ANYTHING ANYBODY to promise to take the PAIN AWAY . At any cost. Shame on us.

Both parties have been wasteful and meddling with our freedoms over the past 10,20,30, 50 years. We the people are Sheep-le. Following anyone with good promises -- because we could be likened to uneducated needy animals.

How do we fix this? We make it obvious to the Sheeple that they have been lied to -- by this admin, but the preceding one, and every other one -- for DECADES.

The put the Federal Reserve in place (which isn't actually Federal at all) and have been selling your kids' future to China for years.

I have heard of a plan to educate the wooly masses of ignorant and uneducated -- it's plans to use MainStream Media aka MSM.

The plan is this: use every resource we have to gather the names, email addresses, and mailing addresses of every possible person in the MSM.

Understand that the people in MSM asks the most useless questions and they do not follow blood when they smell it. They shrink back -- afraid of offending the politicians in power.

We cannot be afraid of our government. They work for US.

When a politician says things that don't make sense (double-talk, blame game, whatever) the media needs to jump on and get the real answers. Not give up until we the people get to see/hear on TV just how these politician liars stand up to REAL pressure. In public. WITHOUT a teleprompter or prepared speech.

Start gathering the email addresses of the mass media now. Keep your eyes open for the next step or make some steps of your own.

I BELIEVE IN THIS PLAN AND BELIEVE THIS WILL BE THE ONLY WAY TO GET OUR NATION ON THE RIGHT TRACK AGAIN. OR IT WILL BE TOO LATE. It might already be too late. But this is the only way we have a chance .

Do it NOW before the government starts filtering the internet . They already filter the TV and RADIO. They have allowed TV and RADIO outlets to be MONOPOLIZED . This makes MSM easier to program with socialist ideas.

The internet is next. It is already happening in Australia, and in China of course, and ATT is already watching a LOT of what comes across their connections.

THANKS TO THE PATRIOT ACT.

GeitHner and his "we need this approved NOW" is just like the PATRIOT ACT.

We are such sheep. We think we needed the PATRIOT ACT? NO, we needed our government to actually do their JOB. They failed miserably. And the result of them failing was the attack in NY and resulting in the Pat Act that took away more of our independence and freedom.

SHEEP . Bahhhhh bahhhh.

Copy this and spread it to EVERYONE you know. Start gathering the contact info and keep your eyes on YouTube. Youtube is probably the best chance we have to get the word out. And have freedom of speech. It is obvious that MSM is no good at this time.; Reply to this comment


by gowwowwow April 3, 2009 2:00 AM EDT: I think Tim Geitner should be fired right now, and we start thinking about firing Bama also (better known as impeachment); Reply to this comment