Why does he still have a job? Not the most original thought, I realize, but the awfulness of the Treasury Secretary struck me anew while I read related posts about the foreclosure crisis.
Why doesn't Geithner try to clean up this mess?
Because he doesn't want to.
This was the point emphasized yesterday by Georgetown Law professor, Adam Levitin, as he testified before the House Financial Services Committee. D-Day -- whose coverage of housing issues has been excellent -- covered the hearing and discusses Levitin's testimony here.
[T]his was the key moment. Levitin said that we don’t have the full data sets from the servicers, or any comprehensive data to see whether there is a full-on crisis of unclear title and improper mortgage assignment. In other words, we don’t quite know the full extent of the problem. Levitin said, essentially, “The federal regulators don’t want to get info from servicers, because then they’d have to do something about it.” They don’t want to recognize the scope of the problem because it would require them to act.
And Levitin in particular singled out the Treasury Department. “The prime directive coming out of Treasury is ‘protect the banks’ and don’t force them to recognize their losses.” That says it in a nutshell, and it was said in open testimony in Congress.
See no fraud, hear no fraud.
So let me try to sum this up, and correct me if I'm wrong. The foreclosure mess threatens the entire U.S economy, perhaps precluding the possibility of a recovery, but the Administration doesn't want to know the truth about it for fear of having to act?
What am I missing?
At the same, time Chris Dodd and Barney Frank -- who're both pretty cozy with Wall Street -- are calling on the administration to actually use the law that bears their name: As Marcy Wheeler explains, Dodd-Frank gives the Financial Stability Oversight Council the authority to take action to prevent a systemic crisis.
We can't blame the Republicans for this one (as much as I'd like to.)
* * *
Dems got crushed, Summer's gone, as is Rahm, even Axelrod's leaving, but there he still sits, the Rubinite largely responsible for the administration's far too friendly relationship with Wall Street. He seems to be one of the few people in the country with absolute job security.
To the question posed in my first sentence, many of you will answer, Because Obama supports what he's doing. That's no doubt true. But it's also true that appointments matter. I argued that point when Obama chose Geithner, and it's no less true now. Some of you will say, But Obama would just replace him with another Wall Street-friendly neolib. To which I say, with a sigh, probably.
But Geithner should be shown the door nonetheless. He's hurting the country.