Doubts about Geithner persist
Lagging poll numbers for the Treasury secretary reflect continuing anger over bank bailouts.
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Americans largely remain positive about Mr. Obama’s economic direction. A recent Gallup poll found that 71 percent of respondents had a great deal or fair amount of confidence in Obama to do the right thing for the economy.Skip to next paragraph
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Asked the same question about Geithner, only 47 percent of respondents said they had a great deal or fair amount of confidence in his economic actions. A March Gallup survey found Americans divided on Geithner’s performance, with 42 percent approving of the way he has handled his job, and 40 percent disapproving.
Reckoning with populist outrage
Because the Treasury’s TARP program is the funnel through which taxpayer cash has been poured into the nation’s financial system, it is Geithner who, rightly or wrongly, hears most about the public’s rage with bailouts when he appears on Capitol Hill.
The Congressional Oversight Panel is a five-member group appointed by the House and Senate to oversee TARP spending, and Geithner’s appearance Thursday was the first time panel members have been able to question him in person.
The meeting, though polite, was contentious, as group members peppered him with questions reflecting their dissatisfaction. Why hadn’t the administration fired a bank chief, as it did the head of GM? Why wouldn’t it accept TARP repayments from Goldman Sachs and other institutions? What was his exit strategy to disentangle the government from its investments in failed insurer AIG?
“The evidence is mixed” so far as to whether the government’s actions have restored adequate credit flow to the US economy, Geithner admitted.
TARP inspector general Neil Barofsky appeared at a hearing of the Joint Economic Committee Thursday, when lawmakers again lambasted administration officials for actions many of their constituents consider mystifying.
The White House has already deployed its most powerful weapon, the president himself, in an effort to combat this unease. In his April 14 speech on the economy delivered at Georgetown University, Obama took 45 minutes to lay out his overall economic strategy, in an attempt to explain why officials are pumping money into financial institutions that helped cause the recession in the first place.
Obama’s ability to continue taking unpopular steps remains to be seen. In Washington, it may be easy for think-tank economists to discuss the need for further federal intervention. But at a recent Brookings Institution seminar, senior fellow Robert Litan warned against ignoring the swell of outrage around the country.
“People are furious at Washington,” he said. “Not just the bankers. They’re angry about the bailouts. They’re angry about everybody getting all the money except them.”
That outrage will be a force to be reckoned with, said Mr. Litan, and not just with regard to the current crisis, but with any future effort to deal with the exploding costs of Medicare and Social Security.
The decline in the value of assets such as homes and retirement accounts has put people in a parsimonious mood, he said. “People don’t want to pay more taxes because they just lost $15 trillion.”