'This Week' Transcript: Timothy Geithner Full Interview


STEPHANOPOULOS: You've given a pretty measured view of where the economy is right now. As you -- as you might imagine, some of your critics take a much harsher tone, from both the right and the left. You know, President Bush's CEA, chairman of the Council of Economic Advisers, Eddie Lazarus, called this the worst recovery since the Depression. And liberal economist, Nouriel Roubini, seems to agree.

I want to read you what he wrote -- said last week. He said: "This recovery is anemic, subpar, below trend, below potential. If we avoid a major external or internal shock, we may avoid another recession and that might be good news. But that's where the good news ends."

Now, they may have different prescriptions, but their analysis seems to converge on this key argument that we'd be better off had President Obama made better decisions.

GEITHNER: Oh, I don't think there's any basis for that. I mean, obviously, if he had said, he -- if he'd had more support from his opponents in Congress, then we could have got more things passed that would have put more people back to worth -- work more quickly.

But the ju -- the actions the president took, at considerable political cost at that time. As you know, he had no support for them from the Republicans -- were incredibly effective in preventing a great depression, getting growth restarted again very, very quickly.

And the initial strength of the recovery was very encouraging. We -- you know, we had some bad luck in Europe and oil and Japan. That hurt things a little bit.

But, you know, things are getting stronger, so we're going to keep working at it.

You know, again, it's important to look back at, you know, this was a -- a financial crisis caused by a shock larger than what caused the Great Depression, caused by a lot of borrowing, a lot of risk taking and too much investment in housing.

And it takes time to work off those things. That makes recovery following a financial crisis slower than were other -- than they would otherwise be.

But we're making a lot of progress on those fronts, bringing down risk in the financial system, working through the housing problems. And consumers are bringing down those debt burdens. And those are all very encouraging things for the strength of the economy going forward.

And again, if you look at broad measures of health of the private sector in the United States, they are really pretty encouraging. Profits, of course, very high; productivity higher, private investment growing very rapidly. A huge boom in energy production and exploration. A lot of strength in manufacturing and exports, in agriculture and high tech. And those things, again, should make people feel more confident that this economy is very resilient. And if we keep doing sensible things to make it stronger, then we'll be -- we'll be coming out of this more quickly.

STEPHANOPOULOS: But you also get right to the heart of something that's puzzling a lot of economists and a lot of Americans. They've seen these profits go up. They've seen the Dow go up. But they haven't seen jobs created in a real consistent way and they haven't seen their wages go up.

GEITHNER: Well, you know, again, unemployment is still very high. And until that comes down, income growth is going to be very -- very soft, very weak. That's the tragic legacy of a crisis this bad.

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