Geithner, Summers Represent Change at Treasury

Tim Geithner and Larry Summers were the top two candidates for Treasury Secretary in the Obama administration, and today at noon ET we officially heard that both are joining Obama's economic team. Geithner will head up the Treasury Department and Summers will be director of the National Economic Council. Having both of these men, rather than having to choose only one, seems to be a great idea and should bode well for future economic policy.

In what might prove to be an important development, we are not installing a CEO into the Treasury Secretary slot. President Bush's record nominating people for this post has not been very impressive, as two of his former Treasury Secretaries were forced to resign, and the jury is still out on Paulson's effectiveness thus far. What did those three men have in common? They were all corporate CEOs before heading to Washington.

Paul O'Neill was CEO of Alcoa (AA) for 13 years before he left for the public sector. He resigned after 2 years and was replaced by John Snow, who had been CEO of CSX for 15 years. Paulson came along in 2006 after running Goldman Sachs (GS) for 9 years. Obviously being a CEO should not exclude you from consideration for the top job at Treasury, but I think it will be interesting to see if it proves to not be the best resume for the job.

Disclosure: No position in AA, CSX, or GS at the time of writing, but positions may change at any time

Comments

[SW Richmond:]

"Geithner, Summers Represent Change at Treasury"

That's the most innocently hopeful thing I've read all day.

2008 Nov 24 02:56 PM

[market ace:]

These guys are much worse than CEO's. The last thing we need are real business novices crating more gov't interference in the markets thinking they know all of the answers. They are nothing but CEO wannabes that did not make it in the business world.

2008 Nov 24 03:29 PM

[User 306173:]

i Think having both of these men are great...

2008 Nov 24 10:02 PM

[moraleconomy:]

Oh Boy. Summers a business wannabe? The only professor in the 300 year history of Harvard to get tenure at the age of 30; Assistant Secretary of the Treasury, Secretary of the Treasury, President of the World Bank, President of Harvard. Enough experience for you? You think the Donald could do better? This is the best economic mind in the western world, bar none.


On Nov 24 03:29 PM market ace wrote:

> These guys are much worse than CEO's. The last thing we need are
> real business novices crating more gov't interference in the markets
> thinking they know all of the answers. They are nothing but CEO wannabes
> that did not make it in the business world.

2008 Nov 24 10:44 PM

[martyjbird:]

Not sure if I'm happy about the kind of change Geithner represents. After all, he recently hired the top risk executive at AIG to be a senior VP at the NY Fed in charge of--you ready?--risk management.

Maybe Wall Street is cheering Geithner because he's going to rehire all of the out-of-work banking execs. Well, maybe he won't have to worry about rehiring Paul Rubin. Rubin is on the board of Citigroup and bares major responsibiltiy for the fact that Citigroup was failing and needed a massive injection of taxpayer funds. Yet, Paulson and company kept Rubin and all the others.

Change? Not from where I stand.

2008 Nov 25 10:02 AM

[axelrod608:]

Change ? All these "experts" went to the same business schools and law schools and "learned" the same stuff. They think alike and, with only minor differences, act alike.

They ALL believe that the only way to "fix" the current situation is to throw massive amounts of newly created money at the problem(s).Worse, they ALL believe that throwing massive amounts of money at the mess will fix it. I don't.

In practical terms, the only change will be the name on the desk nameplate.

2008 Nov 25 10:53 AM

[NOWHEREMAN:]

There is one thing that throwing massive amounts of money will eventually do. The deflationary forces will shift to inflation, big time. IMHO

2008 Nov 26 07:36 AM