Geithner Leaving May Signal End of Obama Era

Geithner is the last member of President Obama's original economic team

ByMatthew Jafee
June 30, 2011, 5:49 PM

June 30, 2011 -- The possible departure of Treasury Secretary Tim Geithner once an agreement is reached with Congress to raise the nation's $14.3 trillion debt ceiling would signal the end of an era: Geithner is the last member of President Obama's original economic team still with the administration.

Other prominent members such as National Economic Council director Larry Summers, Council of Economic Advisers chair Christina Romer and Office of Management and Budget director Peter Orszag have left the White House long before this summer. Even Austan Goolsbee, who succeeded Romer as CEA boss, has announced that he will be heading back to the University of Chicago this fall to resume his teaching job there.

While sources told ABC News' Jake Tapper that Geithner is contemplating leaving his post after the deficit negotiations have been completed, they cautioned that it's too early and there are far too many caveats to say that will definitely happen.

If Geithner does depart, it would mark the final step in the changing of the administration's economic guard. Whenever he decides to leave, the fact that Geithner has lasted longer than any other members of the original team is no small feat, especially considering the dire economic situation he inherited in early 2009 and the backlash he faced shortly thereafter.

In his first few months on the job, Geithner was charged with nothing less than preventing another Great Depression. The economy was hemorrhaging jobs, the financial world was in disarray, and the housing market was collapsing. To make matters worse, Geithner was under siege from Congress. Republican lawmakers had already been skeptical of Geithner after it emerged during his confirmation hearings that he had forgotten to pay $34,000 in taxes when, during his time working for the International Monetary Fund, he had used TurboTax to do his taxes. Months later, in the spring of that year, GOP lawmakers started calling for his resignation after he was blamed for bailed-out insurance giant AIG paying out $165 million in bonuses.

The questions came thick and fast. Why didn't Geithner stop the bonuses? Shouldn't he have known about them sooner? A populist outcry ensued. Some members of Congress accused Geithner of being too cushy with Wall Street, since he came to the Treasury from his job as head of the New York Federal Reserve. A handful of lawmakers on the Democratic side of the aisle even joined in the GOP's calls for Geithner to go.

His problems didn't end there. Treasury was suffering under a shortage of staffers as Geithner sought to implement a new team to take over from the outgoing regime of Hank Paulson. Confirmations were slow in coming from Capitol Hill. The agency's aides acknowledged difficulties in getting a complete group in place.

But Geithner withstood it all. When the AIG controversy was erupting, President Obama stood by him, giving him a sorely-needed vote of confidence.

"There has never been a Secretary of the Treasury, except maybe Alexander Hamilton right after the Revolutionary War, who's had to deal with the multiplicity of issues that Secretary Geithner is having to deal with, all at the same time," the president said at the time.

"He's making the right moves in terms of playing a bad hand and what we need to be doing is making sure that we are providing him the support that he needs," he said.

So Geithner stayed on. While Summers, Romer, Orszag, and Goolsbee have all headed for the exits, he has remained.

Scott Talbott, the chief lobbyist at the Financial Services Roundtable, told ABC News that Geithner's longevity is a testament to his successful tenure.

"He has successfully guided the Treasury Department through the most tumultuous financial crisis in our economic history," Talbott said. "And he has successfully made the transition from New York to Washington, from regulator to politics."

"He got his Washington legs," Talbott added. "Ultimately his intellect and experience proved to be an invaluable resource. He has served the president -- as well as the country -- well."

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