The headline reads: “Obama Backs Geithner Despite Vast Criticisms.” The report concerning the president’s 60 Minutes interview tells us:
In excerpts released yesterday by CBS, Obama joked that even if Geithner offered to step down, he would say, “Sorry, buddy, you’ve still got the job.” The hail of criticism that has hit Geithner for his handling of the bonuses paid by insurance giant AIG — which only heightened the critique of his overall handling of the financial crisis — is to be expected, the president said.
“It’s going to take a little bit more time than we would like to make sure that we get this plan just right. Of course, then we’d still be subject to criticism,” Obama said. ” ‘What’s taken so long? You’ve been in office a whole 40 days and you haven’t solved the greatest financial crisis since the Great Depression.’ “
It is to be expected that every appearance before Congress by Geithner will be a cringe-inducing exercise? Should we have expected that he would have gotten the ball rolling on the AIG debacle and then not come clean on his role for nearly a week?
But never fear: next week we are finally going to get the toxic asset purchase plan. Oh, and Geithner is going to become compensation czar for the entire financial sector. No, really:
The administration has been considering increased oversight of executive pay for some time, but the issue was heightened in recent days as public fury over bonuses spilled into the regulatory effort.
The officials said that the administration was still debating the details of its plan, including how broadly it should be applied and how far it could go beyond simple reporting requirements. Depending on the outcome of the discussions, the administration could seek to put the changes into effect through regulations rather than through legislation.
One proposal could impose greater requirements on company boards to tie executive compensation more closely to corporate performance and to take other steps to ensure that compensation was aligned with the financial interest of the company.
The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving federal bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission.
Apparently the game plan is to freak out everyone who works for any financial institution and encourage them to pursue other lines of work. Good thing we don’t have to rely on these institutions for our economic recovery. Oh wait.
The gap between the administration’s demonstrated level of competence and its ambition to micromanage the economy is humongous. The president seems to have boundless faith in both his hapless Treasury Secretary and his own unlimited wisdom to determine everything from the bonuses for bank vice presidents, to the types of cars Detroit should make, to the appropriate level of carbon output for every factory in the country. Frankly, any government which seeks that much power and control over the livelihoods of its citizens and the operation of its economy would be dangerous. With this crew, it is positively frightening.