Obama Taps Timothy Geithner for Treasury Secretary (Video)

November 22, 2008 at 11:15 am Leave a comment

timothy-gethner.jpgPresident-elect Barack Obama is expected to tap New York Federal Reserve President Timothy Geithner as Treasury secretary on Monday, sources say.

Democratic circles had been buzzing for at least a week that the other front-runner for the post, Lawrence Summers, who had headed Treasury for a time under President Bill Clinton, had been crossed off the list.
Obama is also expected to announce other members of his economic team, sources say. A source close to the transition said that the Obama team knows it has to get its top economic advisers in place quickly to reassure Wall Street. The team was already moving, but Thursday’s market losses sped things up more, according to the source.
The Geithner pick should be cheered on Wall Street. A confidant of Treasury Secretary Henry Paulson, Geithner has been at the center of the government’s fast-evolving response to the financial crisis, chairing meetings at his New York office.
Years before the current crisis, he began sounding the alarm about risks associated with a lack of federal oversight over complex financial products. In 2005, at his urging, financial services companies established a national registry to help process and track their trades of credit derivatives, an insurance-like product bought by financial services companies to cover risky subprime mortgage investments.
A career civil servant, Geithner has a reputation for nonpartisan work. At Treasury, he worked under Summers on international issues, taking a front seat during the Asian financial market meltdown in the late 1990s. And his international expertise could be an asset as the current economic crisis grows increasingly global.
“Geithner is excellent,” said Gary Hufbauer, a former Treasury official in the Carter administration who’s now an economist at the Peterson Institute for International Economics.
While he personally was pulling for Summers, Hufbauer said, “In every position he’s been in, Geithner has performed just superlatively, so there’s every reason to be optimistic about the choice.”
Word that Obama had settled on Geithner to head Treasury began to leak out on MSNBC Friday afternoon, and the stock market began to soar, up more than 500 points to close over 8,000 again.
“Geithner is held in high regard in financial circles and has been a thoughtful and effective leader throughout the recent financial turmoil,” said Rob Nichols, president and chief operating officer of the Financial Services Forum, responding to reports that Obama would formally announce Geithner on Monday.
A former Clinton official called Geithner “really safe solid choice,” one who would inspire confidence and would allow continuity in the transfer of power at Treasury.
Also on Monday, Obama is likely to announce his picks to be secretaries of Commerce and Housing and Urban Development, as well as possibly his top White House economic advisers.
New Mexico Gov. Bill Richardson, who lost to Obama in the race for the Democratic presidential nomination, could be named Commerce secretary.
For HUD secretary, Miami Mayor Manny Diaz has reportedly been vetted. And his selection would be welcomed by Hispanics, who have been concerned they’re being ignored by Obama as he assembles the top echelon of his new administration.
Still, Diaz carries some baggage in his own city’s public housing mess.
Other contenders include former HUD Deputy Secretary Saul Ramirez Jr. and Atlanta Mayor Shirley Franklin.
For the White House economic posts, economist Edward Montgomery, dean of the University of Maryland College of Behavioral and Social Sciences, is reportedly under consideration. And it’s been widely speculated that top Obama economic advisers Jason Furman and Austin Goolsbee would land jobs there, as might Obama economic adviser Dan Tarullo, who’s also widely mentioned as a top contender to be the U.S. trade representative.
Source: Politico

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