Treasury Secretary: Private Job Growth 'Pretty Good'
Geithner Praises Elizabeth Warren, Calls for Expiration of Tax Cuts on Rich
By JOSHUA MILLER
July 25, 2010—
Although Americans on the unemployment line might not agree, Secretary of the Treasury Timothy Geithner thinks job growth in the private sector is "pretty good."
In an interview on ABC News' "This Week," Geithner told host Jake Tapper that coming out of such a deep economic hole, private sector job growth over the last half year was better than satisfactory.
"Right now, the best thing the government can do ... is help create the conditions for the private sector to start to invest in hiring again," he said. "Now, we've seen six months of positive job growth by the private sector. That's pretty good," Geithner said. "Pretty good this early in a recession."
Tapper pointed out that employment had actually declined overall.
The Bureau of Labor Statistics (BLS) said that payroll employment declined by 125,000 jobs last month. The decline, the BLS concluded, was due in part to temporary census workers getting laid off.
Geithner on Bank Bonuses
Tapper asked about a Treasury study indicating that executives in financial institutions that received billions in taxpayer bailout funds paid themselves $1.6 billion in salary and bonuses -- some receiving more than $10 million each.
The Treasury secretary expressed incredulity given that the bonuses doled out in the period in question -- from October 2008 to February 2009 -- were rewards for a time when some of these executives made decisions that helped cause the financial crisis.
Is there nothing that can be done about this, Tapper asked Geithner.
Not really, the Treasury secretary suggested, saying that Treasury official Ken Feinberg "went and used the authority he had to change behavior going forward," but didn't have the ability to do anything about compensation paid before February 2009 to the executives of bailed out banks.
"Our responsibility is to make sure these firms can never again go back to paying their executives to take risks that could imperil the stability of the country as a whole, the economy as a whole," Geithner said.
Geithner Bullish on Critic Elizabeth Warren
Does the Treasury secretary want one of his fiercest critics to helm the newly created Consumer Financial Protection Bureau? Geithner sounded like he does, but stopped short of endorsing her.
Tapper asked the Treasury secretary if he supported Elizabeth Warren, a Harvard law professor and consumer advocate, to head the Consumer Financial Protection Bureau.
"She is an enormously effective advocate for reform," Geithner replied. "Probably the most effective advocate for reform for consumers for consumer protection in the country.
"She has huge credibility, and she played a decisive role in helping make the public case for reform and she was early on this, way ahead of everybody else," Geithner said.
But does the Treasury secretary have concerns about a woman who has been sharply critical of him in her role as independent supervisor of the $700 billion bank bailout?
"I don't have concerns, and I should say in that context that she has been playing a very important role in providing oversight over the programs we put in place to break the back of this financial crisis. You know, put out this financial fire," he said. "Alongside a bunch of other oversight bodies, she did what she had to do in that context, and it's what she should do.
"She should shine a very careful independent assessment on all the actions government takes to make sure ... Americans know what we're doing and see the results of what we're doing and she did that very well," he said.
Geithner Wants Tax Cuts for Rich to Expire, Insists It Won't Slow Growth
Geithner said the White House would push to let the Bush tax cuts expire for individuals making more than $200,000 a year and families making more than $250,000.
"What the president's proposing to do is to leave in place, to extend tax cuts that go to more than 95 percent of working Americans and to leave in place tax cuts that are very important to [incentivize] businesses to hire new employees and to invest in expanding output," Geithner said.
"We think it's a very strong package. We think it's the right package. We think it's fair. We think it's responsible," he said.
Tapper pointed out that Alan Greenspan, former chairman of the Federal Reserve, had said that letting the tax cuts expire, which he supports, would slow growth. Geithner disagreed.
"I do not believe it will have a negative effect on growth," he said.
Last week Greenspan was asked whether letting the tax cuts expire would depress growth.
"Yes, it probably will, but I think we have no choice in doing that, because we have to recognize there are no solutions which are optimum," Greenspan said on Bloomberg Television. "These are choices between bad and worse."
Geithner on Sherrod Controversy
Geithner said that there was a "rush to judgment" in the case of Shirley Sherrod.
"Well, as the president said, I think you saw a general rush to judgment everywhere -- in the press and outside the press," he said.
"I think I agree with it -- it's something that we should all take some caution from and look at these things carefully," Geithner said.