Annette Nazareth, Treasury Secretary Tim Geithner’s expected pick to be his top deputy at the Treasury Department has withdrawn from consideration, administration sources confirm.
The withdrawal of Nazareth, a former Securities and Exchange Commissioner, may further complicate Geithner’s effort to build his staff amidst the greatest economic crisis the nation has faced in decades.
A Democratic source tells me that Nazareth faced resistance on Capitol Hill for being "too lax a regulator" at the SEC.
Nazareth’s withdrawal is the latest blow for the Treasury Department, which has struggled to fill key staffing posts. Last week, Obama administration economics adviser Paul Volcker called the staffing problems "shameful."
"There is an area that I think is, I don’t know, shameful is the word," Volcker said at a Joint Economic Committee hearing on Feb. 26.
"The Secretary of the Treasury is sitting there without a deputy, without any undersecretaries, without any, as far as I know, assistant secretaries in substantive areas at a time of very severe crisis. He shouldn’t be sitting there alone. Now various things have contributed to this, I guess, including vetting procedures, but it really is an unfortunate situation," Volcker said.
Treasury officials insist all essential work is getting done, but Democrats in Congress are worried that work is falling through the cracks.
Yesterday, Sen. Tom Carper, D-Del., questioned Geithner to see if any progress had been made filling key posts.
"I worry about the administration especially with Treasury the ability to — to get your team around you," Carper said. "And can you just give us an update on how — how we’re progressing there? Your deputy secretary and your undersecretaries, assistant — how are we doing there because you need — obviously, you need help."
"We’re making some progress," Geithner responded, "and we’ll — we hope to come up for the committee soon with a full slate of very strong people. And we’re doing this carefully as you would expect and you know trying to make sure that we have the best talent in the country, frankly."