TARP and the Incompetence of Tim Geithner

Neil Barofsky:

In the year since I stepped down as the special inspector general of the Troubled Asset Relief Program, the sadly predictable consequences of the government’s disparate treatment of Wall Street and Main Street have only become worse. As the banks amass size and power, Main Street continues to get pummeled.

Part of the current economic malaise can be traced directly to Treasury’s betrayal of its promise to use TARP to “preserve homeownership.” The Home Affordable Modification Program has brought little meaningful improvement, with fewer than 800,000 ongoing permanent modifications as of March 31, 2012, a number that is growing at the glacial pace of just 12,000 per month.

What Barofsky said. Tim Geithner is a corrupt incompetent. If Obama loses, Geithner will be one of the main reasons why.

Speaking for me only

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    Geithner is only incompetent if he's on our side. (5.00 / 3) (#1)
    by Mitch Guthman on Mon Jul 23, 2012 at 01:35:24 PM EST

    A small quibble: Whether Tim Geithner is incompetent depends entirely upon where his true loyalties can be found.  If one believes that Geithner's loyalty lies with his president and his country, then clearly he has performed incompetently and his incompetence has  gravely harmed the country and severely damaged Obama's prospects for winning reelection.  

    If, however, one believes, as I do, that Geithner is loyal only to the banksters who have always been his patrons and who he believes will richly reward him when he leaves the Treasury, then you are wrong.  He has performed very capably in the service of the banksters.

    I think what matters is that he's (5.00 / 3) (#2)
    by Anne on Mon Jul 23, 2012 at 02:25:46 PM EST
    been on the president's side, or at least one has to conclude that's where he's been, since he still has his job, and Obama's apparently happy with his performance.

    The nexus is, I think, the financial industry; Obama's actions and policies with regard to the industry would seem to suggest that he is pretty invested in serving their needs and protecting them from accountability.  Obama's comments on the housing crisis and the state of the foreclosure mess are also indicative of his loyalties being with the financiers, not the people.

    And suggesting - as some have - that Geithner has been giving Obama bad advice for almost four years only works if you think the president is really that lacking in intelligence.  Which I do not.  I think you have only to look, generally, at those with whom he has surrounded himself to conclude that what Geithner and Friends have done is exactly in line with the president's own world view.

    I am looking forward, in a rubbernecking-the-pile-up-on-the-highway kind of way, to reading Barofsky's book; it won't make me happy, I know, but it will fill in a few more blanks, I think, and confirm some things, especially about the way this administration has approached the housing crisis.


    No need for word games (5.00 / 1) (#5)
    by NYShooter on Tue Jul 24, 2012 at 12:15:36 AM EST
    BTD's assessment of T. Geithner vis-à-vis his connection to B. Obama is self evident. Assuming the words, "success and/or failure" mean what most people believe they mean i.e. a majority of American's economic status improving equals, "success," or a majority declining equaling "failure," Geithner's stewardship of the economy was a failure, and Obama's support for, and acquiescence to, Geithner's advice necessarily makes his management of the Presidency (on the economy) also a failure.

    Of course, as others have noted here, there is a debate as to whether these two gentlemen's goals for the economy run parallel to those of most Americans. I agree with the posters that claim that Geithner's management of the economy has been a rousing success, if protecting the 1% at the expense of the 99% was his goal. I believe it was, and I further believe it was Obama's also.

    But, BTD is also right in claiming that an Obama defeat would most probably be due to a poor economy, and most people will be voting for their own interests, not the Banker's.

    Well, sort of, IMO (5.00 / 1) (#8)
    by sj on Tue Jul 24, 2012 at 10:26:39 AM EST
    Tim Geithner is a corrupt incompetent. If Obama loses, Geithner will be one of the main reasons why.
    I think that more specifically it is because Obama is a guy who would choose a guy like Geithner.

    Has anyone here (5.00 / 1) (#13)
    by Georgie Girl on Thu Jul 26, 2012 at 12:09:56 AM EST
    seen the movie "Inside Job" or is that too 2010? After seeing that & realizing the same cast of thieves have been around for decades & they still survive - it is abundantly clear - the majority of people in this country are just screwed.

    And, the Geithner thing has always been one of those in your face issues like the Iraq war. We all watch this crazy $hit happen and it just becomes an acceptable part of the way government does business.

    which leads one to ask the obvious question: (none / 0) (#3)
    by cpinva on Mon Jul 23, 2012 at 04:56:00 PM EST
    If Obama loses, Geithner will be one of the main reasons why.

    why is he still there? surely pres. obama isn't such an economics rube, so as to believe secty. geithner is doing a "heckuva job!", is he? if so, someone on his staff should have latched on to the pres., a long time ago, and strongly urged him to replace the secty., with someone who actually can buy a clue, and isn't safely tucked into wall street's vest pocket.

    Looking forward to seeing Romney attack (none / 0) (#4)
    by ruffian on Mon Jul 23, 2012 at 05:00:58 PM EST
    Geithner's policies.... But I'm not holding my breath.

    As to the question, (none / 0) (#6)
    by NYShooter on Tue Jul 24, 2012 at 12:18:09 AM EST
    "why, then does Obama keep him?" I don't know the answer; it's a real puzzle. I mean, Obama is first, and foremost a politician, and every politician knows the effect an economy has on an election. I can only guess that here is where his inexperience has betrayed him. Maybe he actually believed the crap Geithner was feeding him, that his policies would lead to an improving economy, enough by election day to get him re-elected. Or, maybe he just doesn't give a $hit. So, he doesn't get re-elected, but by feeding the Fat Cats by sacrificing the "little guys," they would be so grateful that they would invite him into their Club, and you can use your imagination as to what that would mean for him.

    Many of us believe that that was where he wanted to be all along; socially, financially, and psychologically, he made the decision from the get-go that he was more than willing to "throw everybody under the bus" in order to get what he coveted most....an invitation to join The Club.

    If Geithner were the lone wolf in (5.00 / 3) (#7)
    by Anne on Tue Jul 24, 2012 at 06:35:08 AM EST
    this administration in terms of his approach to the economy and Wall Street, it would indeed be a puzzle, but Obama gathered an entire team with these kinds of views, so I think we have to accept that Geithner is a reflection of what Obama believes.

    And, to some extent, Obama's intransigence on instituting policy that might result in some small percentage of homeowners getting relief they don't "deserve" has meshed quite well with what appears to be Geithner's mission: keeping the banks and Wall Street from suffering.

    It's all of a piece: Obama loves him some deficit reduction and austerity; in this economy, that makes no sense, and yet, Obama appears to have no one on his economic team that is arguing against it.

    I think the economy is teetering, and while my concern is for the people that are being affected out here in the real world, I also believe that the political consequence of a languishing economy is not one that will accrue to Obama's benefit.


    And your comment (5.00 / 1) (#9)
    by NYShooter on Tue Jul 24, 2012 at 04:39:52 PM EST
    is just another example of why I sort of just threw my hands up and said, "I just don't know." I hear what you're saying, Anne, that it was more than just Geithner. The whole motley crew was rotten, each in his own way emitted a unique, apathetic fragrance, a stench, actually. And yet they, collectively, shared a bond of immoral indifference towards feelings that give most of us a sense of what humanity is. (or should be)

    So, bottom line, I don't think it makes much difference as to who followed who, or who led and who followed, or whether they simply shared the same philosophy that the Rich deserved their status and unique powers with their responsibility being to protect and further that position.

    However they managed it, the economy stinks, and seems to be accelerating downward. And that just can't be good for the candidate we entrusted to fix it.


    I think there's a danger in thinking this is (5.00 / 2) (#10)
    by Anne on Tue Jul 24, 2012 at 07:55:37 PM EST
    a chicken-or-the-egg kind of thing but, really, it all has to come down to Obama.  Obama hired Geithner, not the other way around, just as he hired everyone else who staffs the economic team.  

    Now, no president gets to come into office and start with a brand new economy; he - and maybe someday, she - has to work with the conditions as they exist. But the people they surround themselves with tell us a lot about the president's world view and how things are going to be handled.

    Obama's not just responsible for Geithner, he's responsible for what Geithner represents.  And if Obama manages to get re-elected, we may see the last of Geithner, but thinking his replacement will be someone who is in some other mold than Geithner would be foolish.

    The fix is in, Shooter, and we're screwed.


    oh, absolutely (5.00 / 1) (#12)
    by NYShooter on Wed Jul 25, 2012 at 11:39:21 PM EST
    and I hope I didn't give the impression that I somehow absolve Obama from his responsibility, or that he was an innocent victim of Geithner's Svengali-like powers.

    Actually, this post here, the one I'm responding to, expresses exactly how I see things. Yes, Geithner, influenced Obama, but Obama was already predisposed, and actively sought that advice. And, of course, you can add Summers, et al to that list.

    During my career in business and management I had the reputation of being quite impatient. As my secretary was bringing an appointment in to my office she would whisper to him/her admonishingly, "remember, get to the point, get to the point."  well, here we are, almost four years into Obama's Presidency, and we're still wondering, "what's his point?"

    If I was the Great Decision Maker in the Sky, interviewing B.O, and didn't know anything about his past, my "point," my first question would be, "how many people have you helped during your tenure, and how many have you hurt?" If the Candidate is vying for "Public Servant," that's the only question that really matters, isn't it? I wouldn't be distracted by flowery rhetoric, or well-turned phrases, just cold, hard, empirical numbers.

    And, in my world, you don't get to be graded on a curve, or "relative to." The thumb either goes up, or it goes down. Now, that's getting to the "point."

    And, on Obama's application, I mark in the margin......Fail.


    And then, (none / 0) (#11)
    by jbindc on Wed Jul 25, 2012 at 09:07:01 AM EST
    there's LIBOR:

    Treasury Secretary Timothy F. Geithner has said that he sounded the alarm four years ago to regulators about problems with the benchmark interest rate known as Libor.

    But Geithner, who was then head of the Federal Reserve Bank of New York, did not communicate in key meetings with top regulators that British bank Barclays had admitted to Fed staffers that it was rigging Libor, according to people familiar with the matter.

    Federal Reserve Chairman Ben S. Bernanke testified Tuesday that he can not assure that a critical global benchmark called the London interbank offered rate, or Libor, is reliable. Libor has come into question after London-based Barclays admitted it schemed to manipulate Libor during the financial crisis.

    Instead, regulators at the Commodity Futures Trading Commission and the Justice Department worked largely without the Fed's help to build a case against Barclays. That work has culminated in a massive scandal rocking the banking industry on both sides of the Atlantic.

    As Geithner prepares to testify Wednesday morning on Capitol Hill, he returns to a familiar position as a lightning rod for critics on the left and the right who find fault in his work as a banking regulator before he joined the White House and as a bailout architect under President Obama.

    He will face a key question from House and Senate members this week: Did he and others at the New York Fed, the country's most powerful banking regulator, act urgently enough to stop fraud at Barclays and potentially other banks?