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Thread: Can Barack Obama save Treasury pick Tim Geithner?

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    Elite Member witchcurlgirl's Avatar
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    Default Can Barack Obama save Treasury pick Tim Geithner?

    Can Obama save Geithner?

    Barack Obama picked Timothy Geithner to save the U.S. economy.

    But now, Obama has to save Geithner first.

    Geithner’s tax problems surfaced publicly Tuesday – but Obama’s team has known about them for at least six weeks, waging a behind-the-scenes campaign to push him through the Senate Finance Committee, despite the blemishes on his record, according to documents from the committee.

    The episode raises questions about whether Geithner’s nomination will survive, despite early soundings of support from Democrats, and perhaps, more importantly, a larger question:

    What was Obama thinking?

    Obama's choice of Geithner flirts with an issue that has deep-sixed Cabinet picks before –his former housekeeper’s immigration status lapsed briefly while she was in his employ.

    Also, Obama’s choice to oversee the IRS flubbed his own tax returns – some of which he had personally prepared – to the tune of $42,700 in back taxes and penalties.

    And Geithner decided to pay more than half that amount — $26,000 — only after Obama decided to nominate him, according to finance committee documents.

    Obama’s team calls them “honest mistakes.” And in the end, Geithner had the only supporter that mattered – Obama himself. One source familiar with Geithner’s vetting says Obama knew about Geithner’s tax problems and decided to push ahead with the nomination anyway because he “still wanted him."

    "At the end of the day, Barack decided that he was the best person for a really important job," the source said.

    "It wasn't that it wasn't a big deal," the source said. "It was definitely factored in. The question was 'Does this disqualify him?' And the answer was no. It was something that he took care of. Yes, it was a mistake but it was in the past."

    "It was put into calculation and at the end of the calculation, he was still the best person for the job."

    So far anyway, some Senate Democrats, and a few key Republicans, agree. Finance Committee Chairman Max Baucus (D-Mont.) said the revelations did not disqualify Geithner, and he said it was crucial for Obama to have a new Treasury secretary in place when he takes office next week. Sen. Orrin G. Hatch (R-Utah) said he still supports Geithner.

    Iowa Sen. Charles Grassley (R-Iowa), the ranking member on the Finance Committee, has privately questioned whether Geithner’s problems should derail his nomination and so far has refused to comment publicly.

    It’s not clear when – or if – Obama’s team planned to go public with the tax problems, first disclosed by the Wall Street Journal Tuesday. And the Geithner developments come less than two weeks after another Obama Cabinet pick, Bill Richardson for commerce secretary, washed out amid questions about what Obama’s vetters knew about a grand jury investigation into the New Mexico governor’s office.

    Obama chose Geithner on Nov. 24 – and at the time, the pick was viewed as a forceful move by Obama to assert himself on the economic front. It came after a particularly bad week in the economy, at a time when commentators were starting to raise questions about whether the new president was taking a firm enough stand to reassure the public about the economic meltdown.

    Perhaps the biggest factor in Geithner’s favor now is that he’s well-known to senators on both side of the aisle, who consider him a smart and level-headed figure from his work on the Wall Street bailout as president of the New York Fed. It would be a particularly bad time to deny Obama his choice for treasury, when world markets are looking to the new administration to get the U.S. economy on stronger footing.

    Still, one potential trouble sign for Geithner is that some senators are speaking out against giving Obama the second half of that $700 billion bailout – which was deeply unpopular among many in the public. If some of that public sentiment spills over onto the Geithner nomination, that could spell trouble. For instance, CNN’s Lou Dobbs already was complaining about the Geithner choice because of his role as an architect of the bailout.

    In the end, presidents usually get wide leeway to build the teams they want, and many senators seems satisfied with Obama’s explanation that these tax and immigration issues were honest slip-ups.

    The Senate Finance Committee documents, however, suggest committee staff put Geithner through the paces – and questioned some of his answers. Transition aides met with committee staff on Dec. 5 to explain Geithner’s back taxes and the committee did follow-up interviews with three Geithner accountants and a human resources rep at his former employer, the International Monetary Fund. Geithner also met personally with committee staff Dec. 19.

    The committee notes that Geithner failed to pay his Social Security taxes while employed at IMF from 2001 to 2003 – even though he was provided documents that explained that he was required to do so.

    In addition, Geithner included payments to overnight camps in calculating his dependent child care credit in 2001, 2004 and 2005. His accountant informed him in 2006 the camps were not allowable expenses. The committee notes that Geithner did not file amended returns to fix the mistake.

    Despite that, the source familiar with Geithner's vetting made clear the treasury pick still has Obama's blessing.
    "Definitely," the source said. "He stays."

    Can Obama save Geithner? - Craig Gordon and Amie Parnes - Politico.com
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    Elite Member MohandasKGanja's Avatar
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    He's toast. And apparently there's a problem with Eric Holder now.

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    Elite Member Grimmlok's Avatar
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    Which one is eric holder?
    I am from the American CIA and I have a radio in my head. I am going to kill you.

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    Elite Member Belinda's Avatar
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    Quote Originally Posted by Grimmlok View Post
    Which one is eric holder?
    He's Obama's pick for Attorney General.


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    Elite Member Grimmlok's Avatar
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    Right.

    Let them go down in flames then. Better down in flames than in a position of power. I'm all for grilling the shit out of people and having them fail than installing them anyway.
    I am from the American CIA and I have a radio in my head. I am going to kill you.

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    Elite Member Little Wombat's Avatar
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    Unless Geithner backs out, he'll go through.

    Same with Holder. His hearing will allow them to bitch about the Clinton pardons, but they're not going to derail him.
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    Elite Member Little Wombat's Avatar
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    Default Washington Post: The Nomination That's Too Big to Fail

    An editorial in the WP today re: Geithner:
    The Nomination That's Too Big to Fail


    By Dana Milbank
    Thursday, January 15, 2009; A03

    The senators were in a state of low dudgeon.

    They had just learned that Treasury Secretary-designate Timothy Geithner hadn't paid all his taxes, and, truth be told, nobody really cared.

    "The man is qualified, competent, one of the best choices the president has made," one member of the tax-writing Finance Committee said yesterday.

    "I think he's a good man," another one said with a shrug.

    "I don't believe there's any doubt about his qualifications," said a third.

    And those were the Republicans.

    In the scandal-obsessed capital, the latest public peccadillo has been met by uncharacteristic indifference. Geithner, the man who would oversee the IRS, paid the government $42,702 because of mistakes he had made on his tax returns, and he disclosed to lawmakers that he briefly had a housekeeper without proper immigration papers. It's the sort of embarrassment that usually fires up the opposition -- but this time, as one senior GOP official put it, "CNN is talking about it more than we are."

    Nobody called a news conference to rail about the nominee. Nobody mentioned it on the floor. Even Sen. David Vitter, a Louisiana Republican who rarely meets a Democratic appointment he likes, was shy. "I don't know enough about the details of that to comment on that," he begged off when asked about Geithner at an unrelated news conference.

    There seems to be no chance that Geithner will suffer the nannygate fate of Zoe Baird, Kimba Wood or Linda Chavez; Finance Committee Chairman Max Baucus (D-Mont) said his confirmation is "a given." Part of that is because Geithner's transgressions are relatively minor. But mostly, senators have decided that times are too dire to be puritanical. The economy is in too much trouble to wait for another Treasury secretary to be nominated -- and Republicans know they aren't likely to get another appointment as good as Geithner, who worked closely with the Bush administration while running the New York Fed.
    Put another way, the guy is too big to fail.

    Still, the cease-fire over Geithner was eerie. When Senate Democrats learned eight years ago that Chavez, Bush's choice to be labor secretary, had sheltered an illegal immigrant, they reacted with phrases such as "cloud over her nomination" and "very disturbing" and "extremely troubling."

    "It doesn't sound good for a labor secretary," Sen. Barbara Boxer (D-Calif.) said at the time.

    Of course, it doesn't sound good for a Treasury secretary to make errors on his income taxes. But Democrats were untroubled. "I think this is an honest mistake," Sen. John F. Kerry (D-Mass.) -- who once had "serious questions" about Chavez -- told NBC's "Today" show.

    "He was very contrite about it, and he said he had fully rectified those mistakes immediately," Sen. Chuck Schumer (D-N.Y.) told reporters.

    A partisan defense of a Democratic administration's nominee? That doesn't explain Sen. Judd Gregg (R-N.H.). "Talented people like Tim Geithner are needed right now," he told Fox News. And it doesn't explain Sen. Orrin Hatch (R-Utah), who told the Post's Shailagh Murray: "I'm not one who holds mistakes against people."

    Sen. Chuck Grassley (Iowa), the top Republican on the Finance Committee, said he hasn't "any doubt" about Geithner's qualifications and praised him as "a relative political independent." Grassley, in a conference call yesterday, said that in the committee's meeting with Geithner, "I didn't hear anybody say that they weren't going to vote for him based on this."

    Could it be that Barack Obama has already brought a new, post-partisan era to Washington? (It almost seemed that way when Larry Summers, Obama's chief economic adviser, showed up in the Capitol to brief Republican senators yesterday; he cast aside not just partisanship but also sartorial dignity: As Summers walked into the Mansfield Room off the Senate floor, his untucked shirttail was hanging out from under his suit jacket.)

    But it's not all harmony just yet. Two GOP senators have postponed Geithner's confirmation hearing, which had been scheduled for Friday. And a few of the backbench Republicans are reacting in the traditional way. "The man who wants to be the top tax collector in America," Sen. Jeff Sessions (Ala.) told reporters, "not having paid $35,000 in taxes, apparently maybe even involving an illegal alien, is a serious matter."

    At Sessions's side, Sen. Jim DeMint (S.C.) accused Geithner of "ignoring the rule of law . . . not as an oversight but apparently intentionally."

    But on this too-big-to-fail nomination, DeMint and Sessions are in a lonely minority of the unforgiving.

    "He may have exceeded the speed limit, but he wasn't weaving out of lanes, he wasn't drunk and he wasn't endangering anybody," Sen. Robert Bennett (R-Utah) told The Post's Lori Montgomery. And Sen. Pat Roberts (R-Kan.), who also expects to support Geithner, even offered some helpful advice to future appointees who have also run afoul of the tax code: "Don't wait until after you're nominated to pay."
    Dana Milbank - The Nomination That's Too Big to Fail
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    Elite Member kingcap72's Avatar
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    They've got to let Geithner go through. With the state of the economy it would be stupid to block his confirmation, unless they can prove that he was really pulling underhanded, illegal shit.

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    Elite Member MohandasKGanja's Avatar
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    You still have to wonder what kind of financial mastermind this guy is if he can't even keep his own taxes straight.

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    Elite Member kingcap72's Avatar
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    Hell, he can't be any worse than Hank Paulson. He couldn't keep $350 billion dollars straight.

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    Elite Member MohandasKGanja's Avatar
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    I don't know about that. This guy is going to have $700 billion+ to play with, and his inability to handle $24,500 is worrisome to say the least.

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    Elite Member Fluffy's Avatar
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    Quote Originally Posted by MohandasKGanja View Post
    You still have to wonder what kind of financial mastermind this guy is if he can't even keep his own taxes straight.
    The point in time when he didn't pay some of his taxes, e.g. FICA, was when he was an employee of IMF. The WSJ reporter that was on the News Hour on PBS explained that about 50% of US citizens that are employed by international organizations like the IMF or UN have problems with their taxes at one point or another because those employees must pay their taxes as if they're self-employed.

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    Elite Member MohandasKGanja's Avatar
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    Quote Originally Posted by Fluffy View Post
    The point in time when he didn't pay some of his taxes, e.g. FICA, was when he was an employee of IMF. The WSJ reporter that was on the News Hour on PBS explained that about 50% of US citizens that are employed by international organizations like the IMF or UN have problems with their taxes at one point or another because those employees must pay their taxes as if they're self-employed.
    The problem is that Geithner is not a typical employee. I'm wondering what other calculations are over his head?

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    Elite Member Grimmlok's Avatar
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    .. pretty sure he doesn't do his own taxes....
    I am from the American CIA and I have a radio in my head. I am going to kill you.

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    Elite Member Mel1973's Avatar
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    Quote Originally Posted by Grimmlok View Post
    .. pretty sure he doesn't do his own taxes....
    "Also, Obama’s choice to oversee the IRS flubbed his own tax returns – some of which he had personally prepared .. "
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