If the Obama administration ever had a strong Treasury secretary, I don’t believe we would be staring at default right now.
Before Tim Geithner and now Jack Lew, no Treasury chief had ever faced defaulting on our obligations, nor have we ever had our AAA status sliced by a major credit-rating agency. And never had the full faith and credit of the United States been questioned before these two secretaries took office.
Real leaders do what they are paid to do: Lead, manage and solve our nation’s problems.
What would have happened five years ago if one of these men led Treasury instead of Henry Paulson?
No working ATMs? No functioning banking system? Depression?
This administration has decided to elevate that once-sleepy backwater post of Federal Reserve Chairman to the face of our economy.
A Treasury secretary should be an out-front, strong leader, a defender of the US dollar and government bonds.
You’d need a calculator to keep track of all the times former Treasury chief Robert Rubin, Paulson, Paul O’Neill and those before them publicly stated that the US has a “strong-dollar policy.”
The Fed was quiet, lost in the wonk world of economic enigma, but always ready to be the lender of last resort — not the underwriter-in-chief.
When asked Thursday at the Democrat-controlled Senate hearing by Sen. Pat Toomey (R-Pa.) about the prioritizing of the obligations of the US government if a debt deal couldn’t be forged, Lew said, “It’s not my call” and “I’d have to talk with the president.”
Great. A week away from default, and those in charge either hadn’t made bona fide contingency plans or were playing shifty politics at a Senate hearing.
Like them or not, Treasury chiefs O’Neill, Rubin, and Paulson all were CEOs of major companies and had served presidents before becoming secretary. Lew has spent most of his career in government.
Since Sept. 11, 1789, when Post founder Alexander Hamilton was named the first Treasury head, presidents have relied on Treasury secretaries to reach across the aisle for the good of the country.
The fact that the Obama administration is using the Fed as his mouthpiece on all things economic speaks volumes. It’s a nod to the European model, in which European Central Bank President Mario Draghi in Frankfurt speaks for all the member nations’ finance ministers.
Through Fed Chairman Ben Bernanke — and probably Janet Yellen, his likely successor — the administration has forced the Fed to assume the debt burden brought on by poor management of the economy by Treasury secretaries for five years running.
Bernanke could have stood tougher, said no to the administration and Congress, and pushed them to work it out.
I’m sure Bernanke has some regrets after essentially having been taken advantage of.
As things stand, China isn’t our biggest debt problem today: The Fed owns more than triple the amount of Treasuries that China does.
Sadly, the Fed has clearly become the primary growth strategy and focus of the Obama administration.