We Have Identified The Problem And It is Geithner

Regular readers know how I have felt about Tim Geithner for a long while now. I think I first called for his resignation the day after he was confirmed as Treasury Secretary. I think my view has become the consensus of anyone not a Republican. See, e.g., Krugman, DeLong, Salmon and Judis.

Salmon says "It’s clear at this point that such a stimulus is not going to happen. The result is going to be devastating for millions of needlessly-unemployed Americans — and also for the fiscal health of the country as a whole. Geithner, it seems, deserves to shoulder a large part of the blame for that." Judis writes:

Will Obama continue to listen to Geithner? I certainly hope not. I used to blame the administration’s timid and self-defeating fiscal policy on Republican intransigence, but as Goldfarb’s profile shows, Obama and his Treasury Secretary deserve a good part of the blame for what is becoming Obama’s “Great Recession.”

(Emphasis supplied.) Speaking for me only

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    Obama's compassion will kick in (5.00 / 1) (#1)
    by observed on Wed Jun 08, 2011 at 03:08:26 PM EST
    any minute now.

    Obama AGREES with Geitner! (5.00 / 1) (#16)
    by Cugel on Wed Jun 08, 2011 at 04:54:00 PM EST
    There's this fantasy that has existed for thousands of years about the king's "bad counselors."

    It's never that the king himself is evil or wrong-headed -- because that would be an insolvable problem -- rather it's that the king receives "bad advice."

    They even believed this of Stalin. This fantasy never faces the fact that the king CHOOSE his adviser BECAUSE the adviser gives him advice he wants to hear!

    Obama doesn't WANT to do anything about unemployment because that would "spook the markets."

    And we must all bow to the markets. He won't get rid of Geitner -- not EVER. That would "send the wrong signal to the markets."

    He just said essentially this in response to questioning by House Democrats last week. He angrily rejected the notion that he ought to be more assertive in defense of his policies.

    Why? Because the markets might get spooked if he used too strong language! God forbid!

    Does this sound like he disagrees with Tim Gietner? He thinks it's "too bad" that unemployment is so high, but the important thing is to keep the bankers happy. They are, after all, the engine that drives the economy, don't you know!


    Cugel, I do believe (5.00 / 2) (#19)
    by Zorba on Wed Jun 08, 2011 at 05:26:40 PM EST
    that observed is using irony.  Otherwise known as "snark."    ;-)

    It's all been a part (5.00 / 1) (#21)
    by cal1942 on Wed Jun 08, 2011 at 05:39:00 PM EST
    of that 11 dimensional chess we've heard about.

    We must be squished into the (none / 0) (#24)
    by observed on Wed Jun 08, 2011 at 05:51:59 PM EST
    7 dimensions which are of subnuclear measurements; Obama and his cronies get to live in the 4  large scale dimensions.
    I'm reminded of The Great Divorce, a bit.

    This is how lost decades (5.00 / 1) (#2)
    by Warren Terrer on Wed Jun 08, 2011 at 03:11:37 PM EST
    happen. Time to start my own vegetable garden and learn how to sew.

    On that (5.00 / 2) (#3)
    by Ga6thDem on Wed Jun 08, 2011 at 03:20:45 PM EST
    account I am truly blessed to have a depression era grandmother and a mother who grew up poor. When I spent my summers with my grandmother, she taught me how to can and freeze a ton of vegetables and my mother taught me how to sew. My step-father has a garden and I might just need to take a lot of visits up there and gather some produce to freeze.

    This was really the impetus behind our (5.00 / 1) (#25)
    by Anne on Wed Jun 08, 2011 at 06:03:26 PM EST
    planting a huge garden this year - aided by my future son-in-law, who grew up on a farm and who is beside himself with happiness at having the opportunity to grow things.

    We eat a lot of produce - I spend more time - and money - in the produce department than probably anywhere else in the store, and I've been feeling the effects of rising food prices; it's a sad day when one's hand hovers over some nice avocado that are selling for $2 each, and feel like to buy more than one is an indulgence.

    So, we made plans and have a plot that is about 20 feet by 100 feet or so; with 26 tomato plants, I have a feeling I am going to learn how to can, and I've been feeling a little like "Bubba" from Forrest Gump, thinking about how we can make salsa, and spaghetti sauce, and sun-dried tomatoes, and tomato juice and tomato soup, and can whole tomatoes, and...see?

    But there's corn and onions and garlic and carrots and celery and beets and beans and peas and broccoli and red cabbage and lettuces and peppers and fennel and cantaloupe and watermelon and pumpkins and cucumbers (for pickles and for salads) and squash and zucchini.

    I can't wait, to be honest, to be able to put some food by, and save some money, and eat good food that's good for us, without guilt.  And share it with family and friends and donate some to the local food pantry.

    Might have to see if I have any tie-dye hanging around from my youth...


    Canning is not difficult (none / 0) (#28)
    by Zorba on Wed Jun 08, 2011 at 06:49:42 PM EST
    Get a good pressure-canner and read the instructions.  My bible over the years has been Putting Food By, by Greene, Hertzberg, and Vaughan.  I understand that there is a newer edition than the one I have- I'm going to check it out.  I also have a steam juicer, which I use to produce juice from cherries, quince, grapes, etc for jelly.  If you want fresh juice for drinking, get a regular juicer, too.  And a hand-cranked food mill is indispensable.

    Was in the garden most of today (none / 0) (#30)
    by nycstray on Wed Jun 08, 2011 at 07:04:02 PM EST
    I had to go back and count the tomatoes already in . . . 22 so far. I have about another 10 or more almost ready to in. Seeing which like my garden the best for seed saving and future growing  :)

    We'll have to start swapping canning recipes in a few weeks  ;)


    and at the end of the season (none / 0) (#36)
    by Amiss on Thu Jun 09, 2011 at 01:21:27 AM EST
    Make you some wonderful green tomatoe pickles. Jams and jellies are also much better made yourself. Much better.

    I have had delightful success (none / 0) (#23)
    by TeresaInSnow2 on Wed Jun 08, 2011 at 05:43:50 PM EST
    growing veggies under inexpensive, low-energy fluorescent shop lighting.  Thus, you can even grow things like lettuce during winter.  If you have outdoor space for the BIG items during summer, you literally don't need to buy veggies at all most of the year.

    I've more than tripled the size (5.00 / 1) (#29)
    by nycstray on Wed Jun 08, 2011 at 07:01:22 PM EST
    of my garden from last year. Hoping to take it year 'round this time . . .

    Getting rid of Geithner might (5.00 / 5) (#13)
    by Anne on Wed Jun 08, 2011 at 04:01:38 PM EST
    help Obama's re-election chances, if people perceive that he's doing it because he no longer agrees that Geithner had the right answers - but - if Obama doesn't immediately (1) replace him with someone who would cure - or at least medicate - Obama's deficit and debt hysteria and (2) begin advocating for and pushing Obama to lead in a different direction, I question whether the optics of canning Geithner would be enough. And I don't see Obama as being willing to nominate an un-Geithner he knows he would have trouble selling to a Senate that is hell-bent, apparently, on imposing this insane austerity program.  

    Once it becomes clear that his chances in 2012 are being eaten alive by the current policies - and I think that really is all that matters to him, getting re-elected -  he may come to realize that he has no good options for saving himself, and how bad it feels to "have nowhere else to go."  

    Too bad his smug attitude about "the base" may be sinking its sharp karmic teeth in his butt, eh?

    He'll land on his feet; the rest of us will pay - for years - for the decisions he's made.

    Too late. (5.00 / 2) (#14)
    by Buckeye on Wed Jun 08, 2011 at 04:23:07 PM EST
    We are halfway through Obama's 3rd year.  Even if he did wise up and can Geitner, there is not enough time for the new leader to make a dent.  Let's face it, Obama had has 3:00 phone call moment, and failed due to poor staffing decisions and poor policy decisions.  The stimulus being too small and poorly structured coupled with the policies from the Treasury department is going to sink Obama.  His only hope is the Republican Party self-destructing (which could happen).

    Yes, "not ready on day one" (5.00 / 1) (#56)
    by Towanda on Fri Jun 10, 2011 at 12:17:40 AM EST
    has become "not ready in year three, either."

    Obama would have to sell a substitute to Wall St. (none / 0) (#26)
    by jawbone on Wed Jun 08, 2011 at 06:35:18 PM EST
    as well as to the Senate.

    Not. Gonna. Happen.

    What I see happening is that Obama campaign people are trying to off load Obama's responsibility for decision making onto Geithner, a handy and someone obviously involved with Big Banksters and Wall Streeters.

    It's a campaign gambit. If it looks like they can get away with scapegoating Geithner for Obama's own alignment with Wall Street, they'll toss him under the bus.

    Well, more likely at least back into some extremely lucrative job with some financial entity.


    it is all so depressing (none / 0) (#33)
    by observed on Wed Jun 08, 2011 at 09:05:23 PM EST
    Boy, is he ever correcting the (5.00 / 6) (#15)
    by observed on Wed Jun 08, 2011 at 04:27:02 PM EST
    "excesses" of the 60's----especially that excess of concern for one's fellow man, however flawed, shown by the Great Society programs.

    By the way, the administration DOES (5.00 / 1) (#17)
    by observed on Wed Jun 08, 2011 at 05:03:56 PM EST
    have  a strong position on jobs as of today: the Senate jobs bill is too much!!! Less is more, baby!

    Yes, and Aravosis made a funny about that: (5.00 / 3) (#27)
    by jawbone on Wed Jun 08, 2011 at 06:48:34 PM EST
    Lots of folks have been complaining for a while that the White House had no message on jobs.  Well, now they do: "Think small."

    The WH informed the Senate they have proposed too many jobs:

    The Obama administration on Tuesday night might have thrown a wrench into Senate Democratic plans to pass what they see as a jobs bill -- by implying the bill spends too much money.

    In a Statement of Administration Policy, the White House said it supports the broad goals of the bill.

    "However, the bill would authorize spending levels higher than those requested by the president's Budget, and the administration believes that the need for smart investments that help America win the future must be balanced with the need to control spending and reduce the deficit," the administration said.  (My emphasis)

    From The Hill.

    Again, Aravosis makes the mistake of implying Geithner is somehow controlling Obama. When, probably, Obama chose Geithner because he knew he would not offend Wall Streeters who funding Obama's primary run for the presidency.  They knew their candidate, and that candidate is giving them what they want.

    Obama does not work for us; he works for the Uberwealthy, corporations, banksters, Wall Streeters.

    If Obama had wanted to create jobs, he would have done so.  But he didn't want to.  Why? All together now! Because he's a conservative!


    lordy (5.00 / 1) (#31)
    by nycstray on Wed Jun 08, 2011 at 07:05:36 PM EST
    how disconnected is this man?

    I had hoped that he would (none / 0) (#37)
    by Amiss on Thu Jun 09, 2011 at 01:28:44 AM EST
    "come into his own" during the election process, just seems "his own" is neither what we needed or wanted, he just gave us the impression that all that "hope" was what it wasnt.

    "Obama does not work for us; he works for the Uberwealthy, corporations, banksters, Wall Streeters.

    If Obama had wanted to create jobs, he would have done so.  But he didn't want to.  Why? All together now! Because he's a conservative!a'

    sO TRUE!


    digby re Obama's "Think small." on jobs (none / 0) (#40)
    by MO Blue on Thu Jun 09, 2011 at 08:16:46 AM EST
    With Mitt Romney out there criticizing the administration for calling the jobless numbers a bump in the road, proclaiming, "No, Mr. President, that's not a bump,that's Americans," this strikes me as a technocratic version of Daddy Bush and the supermarket scanner:

    The Obama administration on Tuesday night might have thrown a wrench into Senate Democratic plans to pass what they see as a jobs bill -- by implying the bill spends too much money. etal link

    The buck stoppeth. (5.00 / 3) (#18)
    by lentinel on Wed Jun 08, 2011 at 05:05:37 PM EST
    We Have Identified The Problem And It is Geithner.

    Actually, we have identified the problem who appointed The Problem and it is Obama.

    The reason Obama's obstinance (5.00 / 3) (#34)
    by NYShooter on Wed Jun 08, 2011 at 10:09:34 PM EST

    Regarding Geithner is so difficult to understand is because of the same reason we find it difficult to understand how so many people follow Limbaugh, Beck, Palin, etc. It's not a cognitive thing, it's love. And, anyone who's been there knows, logic has nothing to do with it.

    I forgot who, or where, I read it, but the article I'm referring to had about the best, or most believable, explanation for this relationship that I can recall.

    It's like these two guys, after a grueling, pressure packed day, retire to a private den where, out of camera's view, they crack open a couple of brews, look at each other and break out in loud, boisterous laughter, hi-fiving each other, like they had just won a handball match. These two guys "connect." To them it's a game, just a couple of frat boys, each wanting to be the other. A perfect combination, they live a life alien to most normal beings, but they share one secret; For them..................Life is good.

    Like the song asks, "what's love got to do with it?" For Barack & Timmie....Everything.

    From early on (5.00 / 1) (#39)
    by Nemi on Thu Jun 09, 2011 at 06:28:37 AM EST
    I always viewed Obama as someone who's emotional development stalled around high school age. Nothing unusual or wrong with that per se, but in "The Leader of the Free World" it does make me sort of uncomfortable.

    Also, when watching footage from the various meetings of world leaders, Obama often seems drawn towards and obviously enjoying joking and fooling around with, the other two fratboys in the crowd, Sarkozy and Berlusconi.


    nah, its because (none / 0) (#35)
    by observed on Thu Jun 09, 2011 at 12:56:26 AM EST
    Obama is
     a moron. Really, he appears to be innumerate, with less understanding of economics than W.

    Certainly (none / 0) (#4)
    by Ga6thDem on Wed Jun 08, 2011 at 03:22:56 PM EST
    Geither should go but it's probably too late now to change the economy before the election. It was a mistake for Obama to even pick him and all this shows a huge lack of judgement on the part of Obama.

    It's never too late (5.00 / 1) (#5)
    by Warren Terrer on Wed Jun 08, 2011 at 03:25:19 PM EST
    The problem is Obama thinks he's doing the right thing, not that he's made a mistake.

    Yeah (none / 0) (#9)
    by Ga6thDem on Wed Jun 08, 2011 at 03:33:18 PM EST
    I don't hold out hope that he'll fire Geither either. But firing Geither right now would be akin to Bush getting rid of Rumsfeld--too little too late IMO.

    He is president. He knows how to (none / 0) (#20)
    by MO Blue on Wed Jun 08, 2011 at 05:31:44 PM EST
    negotiate and he has an existing plan to "fix" the economy. He has been pursuing it under the guidance of Geithner. Obama had other advisors who disagreed with Geithner's advise but Obama chose his policies to the point that he became (by his own admission) down right testy when others continued to disagree.

    For the economic blueprint (none / 0) (#22)
    by KeysDan on Wed Jun 08, 2011 at 05:42:38 PM EST
    look to the Catfood Commission Report (minus the Pentagon cuts).

    i agree (5.00 / 2) (#32)
    by MO Blue on Wed Jun 08, 2011 at 08:30:25 PM EST
    The Simpson blue print will be Obama's compromise position. The writing for that has been on the wall for a long time.

    Pretty sad state of affairs when Simpson drafts Democratic policy.


    Hubris my friend, (none / 0) (#38)
    by Amiss on Thu Jun 09, 2011 at 01:30:20 AM EST

    Never too late to create jobs (none / 0) (#6)
    by Militarytracy on Wed Jun 08, 2011 at 03:28:17 PM EST
    And create the only economy we have real say over....the domestic economy.

    It certainly (none / 0) (#7)
    by Ga6thDem on Wed Jun 08, 2011 at 03:31:50 PM EST
    would be the RIGHT thing to do and should be done for that reason alone to alleviate the suffering going on in this country right now but as far as the electoral politics of it, it is too late to change the trajectory for '12 as far as the economy goes.

    I mean even if Obama did what needed to be done RIGHT NOW, it wouldn't change things for a while.


    The first day that people went to work (5.00 / 1) (#11)
    by Militarytracy on Wed Jun 08, 2011 at 03:38:52 PM EST
    That would be an amazing day.  And the news trucks would be there too :)  I don't know how you play the kind of ball that Obama has been playing though and then call for a new ball and get one in the game in 12 months.

    He (none / 0) (#8)
    by jbindc on Wed Jun 08, 2011 at 03:31:55 PM EST
    Like all the other clowns here in DC are only concerned about their own jobs.

    Oh My (none / 0) (#10)
    by Militarytracy on Wed Jun 08, 2011 at 03:35:46 PM EST
    Well....if this economic crisis is a sort of Iraq, Tim Geithner is General Casey.  Now who has been playing Shinseki, Petraeus, and McChrystal?  Can we skip assassinations in Baghdad this time?

    Obama needs Timmeh (none / 0) (#12)
    by TJBuff on Wed Jun 08, 2011 at 03:41:24 PM EST
    to get his billion spacebucks.  Don't see him being shitcanned until right before the election.

    Oh boy! (none / 0) (#41)
    by TeresaInSnow2 on Thu Jun 09, 2011 at 10:59:21 AM EST
    Another cut to the payroll tax.  That might fix us right up!  


    Only a Democrat would be allowed to destroy Social Security without public outcry.  

    I wasn't going to be surprised if (5.00 / 2) (#43)
    by Anne on Thu Jun 09, 2011 at 12:17:39 PM EST
    there was a move to extend the 2% cut on the employee side, but I admit to being somewhat surprised that the latest desperate idea is to cut from the employer side.

    As I said to CST in another thread, these may not be acts specifically designed to destroy - or undermine - Social Security, but if they have that effect, the intent doesn't matter.

    What's insane to me is that even if you took the possible effects on Social Security out of the equation, another tax cut - one that would allow employers to keep more money - isn't going to do what needs to be done to get the economy moving up again.  How many times does it have to be shown that tax cuts don't create jobs before they stop doing it?

    Never, I guess; I'm convinced that as long as Obama and Geithner can keep the markets happy, they will continue to ignore the multiple elephants in the room: jobs and the housing market.

    Stupid, stupid amd more stupid.


    Bah, it's obvious Obama wants to be (5.00 / 1) (#44)
    by observed on Thu Jun 09, 2011 at 12:19:24 PM EST
    the anti-FDR. He hates government handouts as much as any Republican.

    Handouts to individuals, that is. (5.00 / 1) (#45)
    by observed on Thu Jun 09, 2011 at 12:20:07 PM EST
    As a rock-ribbed Republican, Obama believes that the free market demands that taxpayer money go to the wealthy and their corporations.

    The corporate tax cuts are not (5.00 / 1) (#46)
    by MO Blue on Thu Jun 09, 2011 at 12:27:56 PM EST
    to create jobs but to create campaign contributions for politicians.

    Sounds sort of like (5.00 / 1) (#47)
    by Zorba on Thu Jun 09, 2011 at 12:50:10 PM EST
    "Only Nixon could go to China."

    A few more write ups on Geithner (none / 0) (#42)
    by Militarytracy on Thu Jun 09, 2011 at 12:05:15 PM EST
    Simon Johnson, I liked what he had to say about preventing the next crisis A LOT.  And Andrew Leonard at Salon writing about Geithner trying to lose the election in 2012.  At the end of this write up he discusses how things can go very badly if the economy doesn't show some kind of improvement by 2012.  I don't see how that can happen.  Quantitative easing via the Fed is scheduled to end this month.  Many people who dabble in the stock market say that the reason why it is slipping this month is that QE3 hasn't been announced.  The market was already factoring it in as a certainty.  Bernanke "seems" to be holding firm too, refusing to say he's even considering it.  It is expected that there will be a sell off due to the current round of quantitative easing ending.  Will it happen?  How bad will it be?  Will they end up having to announce QE3 to stop the market from sliding into oblivion? Nobody knows

    This President doesn't seem to acknowledge the risk that Geithner and Larry Summers too have placed squarely on his shoulders.  It never was going to be them who would lose their heads if they were wrong, it still isn't.

    Simon Johnson (none / 0) (#48)
    by Warren Terrer on Thu Jun 09, 2011 at 01:37:42 PM EST
    is a bizarre individual. He does seem to have some understanding of the failings of the IMF and how corrupt regimes ruin economies with IMF help, but he worked for the IMF for years as their chief economist and he's a member of the Peter G Peterson Institute, the one that's out to destroy Social Security.

    I would be very cautious about putting too much weight on Mr Johnson's analysis. For instance, in the article you link to he rightly takes Geithner to task for basically trying to blame the crisis on Britain, and yet he totally fails to mention that the crisis was caused by the bursting of the US housing bubble, which is the most obvious rejoinder to Geithner's nonsense.

    Johnson is right sometimes, but he's not right often enough.


    That is how it goes with economists (none / 0) (#50)
    by Militarytracy on Thu Jun 09, 2011 at 01:47:54 PM EST
    Most of them are able to visualize the whole system but then people develop their own pet projects linked to certain ideology that they believe in.

    Even for an armchair quarterback like me, what I want, what I demand on blogs is part of my ideology.  It is an ideology that economies serve the people when push comes to shove.  There are people without economies but there are no economies without people.  And economies are not living breathing beings that feel pain, people are though.  Funny thing is though, when you are taking care of the people, for as long as I can look at the history out there.....it creates strong economies.  When you run an economy that seeks to profit from human suffering, it always seems to be immediately doomed from the start.  It will always seek correction away from that because human beings feel.  The most successful economies are those that have sought to predictably relieve human suffering.


    And burst of the housing bubble wasn't the (none / 0) (#51)
    by Militarytracy on Thu Jun 09, 2011 at 01:58:01 PM EST
    only thing that toppled our economy, over leveraging and derivatives played a key role all interconnected and interwoven.

    Overleveraging (none / 0) (#52)
    by Warren Terrer on Thu Jun 09, 2011 at 02:09:47 PM EST
    and derivatives caused the housing bubble. Indeed they played a role. The economy toppled when the bubble burst.

    No it didn't (none / 0) (#53)
    by Militarytracy on Thu Jun 09, 2011 at 02:15:02 PM EST
    It toppled when investments began failing because of the burst of the bubble and people couldn't pay up.  We could go all day chasing this rabbit down a hole :)

    The investments (none / 0) (#54)
    by Warren Terrer on Thu Jun 09, 2011 at 02:45:46 PM EST
    that failed and caused the depression we are now in were investments in housing.

    That is true (none / 0) (#55)
    by Militarytracy on Thu Jun 09, 2011 at 08:00:11 PM EST
    But mortgages are collateralized loans, and not singularly able to bring our entire economy crashing to its knees.  It took Wall Streets innovative over leveraging and innovative investment vehicles to do that.

    In the olden days, who took the hit when you defaulted on your mortgage was your local bank.  And they would focus on their collateral that became theirs to recoup their losses.  Sometimes in these situations they lost and sometimes they made more money finding a new buyer.  It was Wall Streets innovation that took a fairly simple stable system and turned it into a monstrosity that brought us to our knees once......and their new fangled investment vehicles can do it do us again without a housing bubble and mortgage backed securities being where the majority of the cancer grows out of next time.


    Here are recent write ups from Robert Scheer (none / 0) (#49)
    by Militarytracy on Thu Jun 09, 2011 at 01:41:28 PM EST
    that I missed until I started looking for them.

    Geithner and Goldman, Thick as Thieves was written June 1

    And the more recent

    The Bernanke Scandal: Full-Frontal Cluelessness

    Neither piece will leave you with a feeling of well being.