The reputation of U.S. Treasury Secretary Tim Geithner is undergoing a major renovation, courtesy of adoring profiles this week in the New Yorker and the Atlantic.
Both profiles laud Geithner for his brains, his decisiveness and his courage in resisting calls to nationalize the largest U.S. banks. He’s credited with being the brains behind the stress tests and various bailouts that have been successful in getting the U.S. financial sector off the ledge and back to some semblance of normality.
I’ve long thought Geithner was the victim of a lot of silly criticism and I’m glad to see him get fairer treatment. But I’m suspicious. It’s an amazing coincidence that two major magazines beloved of policy wonks should decide to profile Geithner in the same way on the same week. The coincidence smells like a coordinated campaign by Geithner’s press people.
Could it be that what we’re witnessing is a Washington power struggle? Perhaps Geithner is seeking to improve his position in the Obama administration. Or maybe he’s trying to grab credit while the grabbing is good.
For a caustic account of Geithner’s work, turn to Mike Konczal, the former financial engineer who writes the Rortybomb blog.
He’s highly skeptical of the stress tests performed on the large U.S. banks last year and believes losses may be far deeper than even the worst-case scenario of the stress tests would suggest. Though, as he says, the U.S. government will never admit it — “they’ve already unrolled the Mission Accomplished banner when it comes to these tests.”
Freelance business journalist Ian McGugan blogs for the Financial Post.
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