Geithner Can't Keep Up, Critics Say

Lack Of Top Aides May Be Hindering Treasury Secretary's Response To Economic Crisis

(AP)  For five weeks, Treasury Secretary Timothy Geithner has battled the worst economic crisis in generations with no key deputies in place. That's made for a rocky debut for the man President Barack Obama put in charge of addressing the financial crisis.

With an awkward first television appearance, a bank rescue plan that lacked promised specifics and two restructured bailouts that raised taxpayer risk, Geithner has failed to calm financial markets desperate for answers.

Critics say part of the problem is that Geithner is flying solo: Not one of his top 17 deputies has been named, let alone confirmed. And without senior leadership, lower-level Treasury employees can't make decisions or represent the government in crucial conversations with banks and others.

As Geithner strives to address the financial crisis, advance Obama's agenda and work with foreign leaders to stave off economic disaster, he's assembled a 50-person "shadow cabinet" of would-be appointees. Those people have received hall passes and can advise Geithner, but they lack any authority.

"Everyone would think it's a travesty if the Defense Department didn't have a lot of their people in place, because you're in a crisis fighting a couple of wars," said Tony Fratto, who was a Treasury spokesman under President George W. Bush. "But Tim Geithner is fighting wars on a few fronts himself, and he doesn't have the generals there to help him."

Treasury's staff problems apparently have affected its ability to report to Congress on the massive bailouts it has been doling out.

At a Senate hearing Thursday about failed insurance giant American International Group Inc. - which has received four separate bailouts totaling more than $170 billion - Sen. Chris Dodd said he had asked Treasury for someone to appear, but that no one was available.

"I am not pleased that we don't have someone here from Treasury to explain what their role in this is," Dodd said.

Treasury officials contend that Geithner is receiving plenty of good advice, much of it from the 50 advisers already working there. But until Treasury gets some Senate-confirmed leaders, these people can't sign documents or make policy decisions. They can't even sit in their future offices.

To be sure, a great deal has happened at Treasury since Geithner assumed his post. The department has rolled out a few details of its much-maligned financial stability program, new programs to aid homeowners and has started assessing the strength of major financial institutions. And one official, Under Secretary for Terrorism and Financial Intelligence Stuart Levey, has been asked to stay on.

The problem, critics say, is that many of these initiatives would have gone more smoothly if Geithner had a full complement of senior staffers to work with.

Among the harshest critics of Treasury's leadership vacuum is Paul Volcker, an Obama economic adviser and former Federal Reserve chairman who last week called the situation "shameful."

"The secretary of the treasury is sitting there without a deputy, without any undersecretaries, without any, as far as I know, assistant secretaries responsible in substantive areas at a time of very severe crisis," Volcker said. "He shouldn't be sitting there alone."

The White House took issue with Volcker's statement, saying Geithner has plenty of able staffers. Former Treasury Secretary Lawrence Summers, Obama's chief economic adviser, has worked closely with Geithner for years.

Treasury officials say the administration is taking extra care to vet possible appointees after embarrassing revelations about tax problems for Geithner, former Health and Human Services Secretary-designate Tom Daschle and others.

One likely nominee to a top Treasury post has not heard from the department for weeks, the person said, speaking anonymously because there has been no official offer. The person submitted voluminous information about taxes, domestic help and the like more than a month ago.

Former Treasury employees said that even the best lower-level staffers and top advisers can't do the work required of Treasury's top ranks. They can't explain Treasury's policies to a nervous public or give a fair hearing to stakeholders in the crucial decisions the department must make.

Fratto said Wall Street bankers complained to him recently that meeting with lower-level Treasury staff, rather than with senior appointees, wouldn't address their issues.

"They know that only the political appointees are the decision-makers," he said. "You can share information and work with people at the deputy assistant level, but the bosses just aren't there."

Meeting with Geithner could have satisfied the bankers, Fratto said, but the secretary has been stretched thin with congressional testimony, aid to automakers, restructuring the bailouts for Citigroup Inc. and American International Group Inc., reforming the regulatory system and developing a revamped bank rescue plan.

"They have a lot on their plate and more staff will help handle the work," said Scott Talbott, a lobbyist with the Financial Services Roundtable.

Perhaps Treasury's highest-profile effort - its management of the $700 billion financial system bailout - is still led by Neel Kashkari, a Bush administration holdover who officials said is on his way out.

Fratto said that makes it impossible for Kashkari to engage in real negotiations with banks. He said the bailout has been hurt by "uncertainty over what the policy is, the details, whether they're going to stick, whether the programs are going to change again - and these are all things that Neel probably can't answer for them, and no one can answer for them."

The concerns are gaining momentum in advance of next week's meeting in London with finance ministers of 20 major countries. Without political appointees to negotiate discussion points or the texts of public statements, the White House will have to take a larger role, former Treasury officials said.

For the first such meeting, in November, Deputy Treasury Secretary Robert Kimmitt traveled to Australia while then-Treasury Secretary Henry Paulson stayed in Washington. Geithner, overseeing bailouts that have ballooned in size and scope, has no such deputy.

Treasury's lack of official leadership created an opening for the State Department to assume a major role in economic dialogue with China, which had been a Treasury initiative, Fratto and others said.

Treasury doesn't "have the people at that table who can carry the weight in a fight with the State Department," Fratto said.

Treasury officials say they are very close to announcing their first slate of appointees, which will include some top-level officials outside the 50-person team now advising Geithner.

The current team includes about half the appointees Treasury will have to name.

[swin5]

Let's see, on his own he puts us over $2 trillion in debt. And you want to give him 17 assistants to help him?

[philabias]

G-D help us when he can spend faster..Someone needs to tell him that he cant spend us out of this the companies that he bails noone will use ( why ) because they are failures and deseve and funeral and auction....... There is no such thing as to big to fail. in translation it means i choose my favoritsSo we dont trust him andevery time he speaks the market dives And that k=can not be fixed by hiring more hands . Americans are seeing that Obama is Bleach and are losing faith quick. And wait ill the 700,000 who filed for unemplyment see that it is taxed although they where promised thet would see no new taxs and only the rich will I geuss to Obama haveing unemployment makes you rich.......you will see taxes real soon.

[budmag06]

Wall Street Republicans like Milton Friedman, Nixon, Reagan, Bush I and Bush II.

Laura Ingram, Sean Hannity and Druggie Limbaugh who preached 'deregulation' and 'tax cuts for the rich' while we bankrupt America hunting for WMDs that Reagan gave Saddam.

___________________________________________________________________

whitemale08, You forgot "Carl Rove, Sarah Palin, Newt Gingrich, Bobby Jindal, Teddy Roosevelt, & Abe Lincoln" on your hate list. Wow! Your non-sensical post is a liberal's dream! I think I'll post a list of Obama's tax cheaters and post it as criticism for the entire Democrat party.

[mljohns00]

Don't know why he's having so much trouble finding candidates for posts. Just go down an IRS list of tax evaders and he'll find lots of candidates.

[whitemale08]

I don't blame Tim but he needs to quit thinking he can save the financial system because it's already dead thanks to Wall Street Republicans like Milton Friedman, Nixon, Reagan, Bush I and Bush II.

Also you can't forget these junkyard dogs on talk radio like Laura Ingram, Sean Hannity and Druggie Limbaugh who preached 'deregulation' and 'tax cuts for the rich' while we bankrupt America hunting for WMDs that Reagan gave Saddam.

[ragnar30066]

Well, the stock market is down over 50% since Obama was elected, millions more are out of work, we've saddled the next two generations with debt that can never be repaid, we've humiliated our strongest allie and thrilled our enemies and President Hussein has just begun to learn "on the job". Oh, well, he got the change he was hoping for.

[palmflood]

I sense that Geithner's heart is not in this gig. I don't think the detractors will get used to him and I think he knows it. There are others.

[nearl451]

Wow. some comments here are pretty silly. Taxation without representation? What you live in DC? Couldn't vote in November?

We just had an election,morons(i.e. representation). Colonists did nothave that right.

Besides the Supreme Court keeps ruling that money and corporations have the same individual rights that you have. It has been the K Streeters that gamed the system. They have more votes than us.

Now that there is some opportunity for a break, All I hear is grousing about changing the system the wrong way.

[tamericanpie]

Turbo Tax Tim should just quit while he's behind.

[tincup356]

Americans should be ashamed of BOTH parties...for over 40 years they have harloted out their representation to lobby interests, and passed legislation that allowed wall street and the banking industry to delve into practices that were dangerous, unethical, and in some cases possibly criminal.......BOTH parties created ALL this mess over the years and betrayed the people while doing it............LOBBYING is nothing but bribery,,,last year Wall street and the banking industry paid almost 2 billion dollars in lobby payment to BOTH parties,,,,,,,,,,Just connect the dots where lobby dollars came from and who got bailouts and stimulus benefits?...Any way you add it up ...it is TREASON.............To top that off they want to give Palestine 900 billion dollars?........I guess congress has forgotten why we had our first revolution....it was over TAXATION WITHOUT REPRESENTATION.........just like giving Palestine our tax dollars.......where does that represent us?...The people of this country are not represented and every member of congress took an oath to do that,,,,they are TRAITORS.

[xeilfrud]

Wow. Republicans are convinced that the Democrats are mishandling the mess. Democrats are convinced that Republicans created the mess singlehandedly while the Dems are completely blameless. Hello, it's both parties together that got us in this mess, while we the people greedily and blindly went along for the ride. Before you start screaming at the left or the right to pass blame and judgment, try looking in the mirror.

[platteman]

He is the most qualified to lead the treasury!!! why can't he keep up?? maybe someone else should lead the treasury.

Turbotax timmy is way over his head. Obambi and his merry men are in deep trouble.

[rational_1]

I'm not worrying about Geithner keeping up - I'm much more concerned about the rest of us keeping up with these fools spraying OUR money all around. I seriously don't believe any of them know what they're really doing and I have zero confidence in how sensibly they are spending OUR trillion dollars. And on top of that Bailout Barry says he's also going to revamp healthcare, starting now - this idiot is going to bankrupt us (or rather our children).

[mjvwsr]

"Geithner Can't Keep Up, Critics Say"

he should try Viagra

[specialty8]

Turbo Tax Timmy is still trying to figure out how to use it. Maybe I can send my 5 yr.old over and show him how it works.

[cheetah-man7]

dongo3.............. Dude, chill out! Your rants make you look really stupid. Just relax and take it like a man!

[poeticaintit]

. Obama is being too much of a micro-manager of government. Does this mean he doesn't trust the people who he brings in? Who knows. But apparently he feels he's the best person to carry the messages of each department.

A Jack of All Trades is a Master of None....
Posted by boosterprez1

As he should because it's his name that will ultimately bear the brunt. It's his Administration....his economy...his people....his decisions. He better know it all....Oprah taught him all this, I think.

[poeticaintit]

Of course he can't keep up, because he is being asked to do more work on this bailout than Paulson ever did. The Bush people just threw money at the problem. Geithner has to do so much more oversight and that is bogging him down.
Posted by koko98-2009

Uh.....the Dems were right there, too. Don't forget.

[poeticaintit]

Oh....I thought this was talking about not being able to keep up with his taxes. Duh? And the vetting process probably wouldn't have allowed him to sqeak through if it was as thorough as it is now....and only because the Dems are sick of walking around with egg crusted on their faces. Face it...Dems love to raise the taxes because they never have any intention of paying them. Term limits....

[boosterprez1]

1. Obama can't get people confirmed quickly enough now, because of his lapses in judgement for previous picks with tax problems. These errors have forced increased scrutiny of everyone being selected...and rightfully so. With no one in place, there's no one around to carry out the people's business.

2. Obama is trying to do too much, too quickly. He's trying to be all things to all people. He's trying to solve all of our problems immediately, in ways that are questionable, given our current economic situation.

3. Obama is being too much of a micro-manager of government. Does this mean he doesn't trust the people who he brings in? Who knows. But apparently he feels he's the best person to carry the messages of each department.

A Jack of All Trades is a Master of None....