Matt Yglesias

Gene Sperling Returns

Gene Sperling, who headed up the National Economic Council in the Clinton administration after Robert Rubin left the job, willl be joining Timothy Geithner at the Treasury Department where he will “will advise on fiscal policy, including issues related to the annual budget, taxes and the domestic entitlement programs – Medicare, Medicaid and Social Security – whose growth is driving projections of long-term deficits.” It seems like an excellent choice to me. Geithner’s area of expertise is specifically in finance, but obviously these swathes of economic policy are hugely important and recruiting Sperling means there’ll be a real heavy-hitter on the treasury team. Among other things, Sperling’s been a CAP guy ‘lo these past several years so here’s a taste of his writing:

• A Powell Doctrine for the Economy and a Grand Bargain, November 20, 2008
• Address Health Care in a Second Stimulus, November 13, 2008

• Stagflation, Not Strong Growth, Justifies Pause, July 3, 2008

• Double-Bubble Trouble in Commercial Real Estate, May 9, 2008
• Soaring Food Prices Mean Less Education for Poor, May 1, 2008
• `The Wire’ Showed No Options for Men , April 22, 2008
• Subprime Mortgage Meltdown Renews Urban Blight, March 19, 2008
• How Bob Ball Dominated Social Security Debate, February 27, 2008
• U.S. Moves Closer Toward Economic Stimulus Plan, January 24, 2008
• Global Warming Insurance Policy Is Worth Premium:, January 2, 2008

He also wrote a book, The Pro-Growth Progressive, which has a slightly annoying title and lots of great policy ideas.

Reading About Timothy Geithner

Here’s some Tim Geithner clippings:

• Here’s Bob Kuttner: “Geithner’s admirers span the spectrum from Republican financial mogul Pete Peterson to liberal Democrat Barney Frank. One can infer from his broad fan base three possible conclusions: Wall Street is so clubby and politically powerful that permissible policy differences just aren’t that great; or maybe Geithner is all things to all people; or perhaps, in a deep crisis, truly talented and effective people can earn broad respect. “
• Here’s Noam Scheiber: “In recent weeks, another financial crisis has ushered Geithner and Summers onto center stage. Geithner has helped guide the government’s response from his perch at the New York Fed; many see him as the most pragmatic voice in a trio that includes Fed Chairman Ben Bernanke and Treasury Secretary Hank Paulson, two men skeptical of market interventions. “The idea that the Fed did as much as it did–with new facilities, new ideas–the breadth of it is stunning,” says one former Fed official.”
• James Fallows notes Geithner’s background in Asia issues.
• A New York Times profile from back in 2007.

I think it’s interesting that he’s a career civil servant turned political appointee, rather than a guy with a business background conscripted into government service. The financial crisis presents a difficult dilemma insofar as you want policy to be made by people who understand the world of finance, but you don’t want it to be made by people whose personal history in the finance world creates too many conflicts of interest or deep personal investment in the future of various bank executives. Geithner’s biography seem to walk that line appropriately.

Paulson on the Job

The Wonk Room notes Hank Paulson’s disturbing habit of proclaiming that everything is fine just before some new piece of terrible news hits. Just last week he said “the banking system has been stabilized.” Now Citigroup is on the verge of collapse.

And yet for some reason some keep feeling that Paulson is worthy of things like gushing Washington Post writeups. It’s frightening to consider the implications of the fact that the Secretary of Treasury doesn’t seem to know what he’s doing. But just because it’s frightening doesn’t mean we need to be in denial about it.

Treasury Secretary

The Page lists the following candidates:

Treasury secretary: president of the Federal Reserve Bank of New York Timothy F. Geithner, former Federal Reserve chief Paul A. Volcker, former Treasury Secretaries Robert E. Rubin and Lawrence H. Summers.

As the ninth most important person in America, I don’t think this makes much sense. The Fed Chairman is more important than the Treausury Secretary. Volcker’s already been Fed chair and wouldn’t take a less important job. Rubin and Summers have already been Treasury Secretary and wouldn’t want to do the same job again. Geithner would be the logical candidate to succeed Ben Bernanke as Fed Chair (the more important job) in 2010. It’s not going to be any of these people.

Bob Kuttner (the 27th most important person in the country) thinks the job ought to go to current FDIC Chair Sheila Barr (currently the 13th most important person) so it’ll either go to her, or else to Laura D’Andrea Tyson Wonk Room economics blogger Pat Garofalo who’s only the 1,245th most important person in the country but has been rocketing up the charts since graduating from college back in May.