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Sunday, February 15, 2009

The Tim Geithner Problem

America is sliding toward Economic Nationalism (think National Socialism), and John Batchelor is all over it. A snippet from a recent article: (the schedule for tonight's radio show)


The Tim Geithner flop on Tuesday 10 at his Treasury maiden speech that was to roll out the Obama administration recovery plan -- the metaphor of the three-legged stool -- is now the weak seam in the American government that will be attacked and opened by U.S. rivals.  Jim McTague identifies the twin errors made by Geithner in his first weeks in Jim's pithy column this weekend in Barron's, the tax fraud errors in his confirmation hearings, and especially the Treasury speech:  "But Geithner delivered none of the promised thunder. The all-important asset piece of the plan was "conceptually hollow," moans a financial executive. The old adage is that the Street abhors uncertainty. Geithner served a three-course meal of the stuff."    Those twin errors are fixed and have given everyone doubts about the credibility of the Obama financial team.  However it is what happens next that will tell the tale, and it may have already done at the G-7 meeting inRome starting Saturday 14 (above).  Geithner was challenged by the other ministers to comment upon the "Buy American" mandate in the stimulus package just passed by the Democrats, and his response, as characterized in the Wall Street Journal, looks to be obfuscation and repetition of the concern (my ital):

The comments come as some countries, including Germany, have expressed concern about protectionist tendencies following a "Buy American" provision in the U.S. government's $787 billion economic stimulus package that requires that purchases for infrastructure spending come from the U.S. Mr. Geithner said the stimulus plan will create a foundation for an economic recovery. The French government's plan to lend auto makers €6 billion in exchange for a pledge not to cut jobs has also raised concerns about a slide towards economic nationalism.

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