Timothy Geithner’s replacement critical to debt ceiling debate

tim_geithner_0210_0-svdtwyTreasury Secretary Timothy “Turbo Tax” Geithner is saying, “Oh no, been there, done that,” and will step down from his Cabinet position before another inevitable debate in February about raising the debt ceiling, Bloomberg reported.

Geithner is the only member left from President Obama’s economic team, and he has said he will leave his position by the end of January.

It is no secret that Geithner has wanted to step down for some time now. However, the last time Geithner wanted to leave, after the debt-ceiling debacle of 2011, Obama convinced him to stay through the president’s first term.

On hitting the debt limit, Bloomberg reported:

Geithner told Congress on Dec. 31 that the U.S. hit its statutory debt limit, necessitating emergency steps announced last week to keep funding government operations and avoid default. By relying on the ‘extraordinary measures,’ Geithner has said Treasury can create about $200 billion of ‘headroom’ to avoid a possible default.

Like Geithner did in 2011, the next Treasury secretary will play a key role in negotiating the debt ceiling with a new Congress. And so begins the speculation about who will replace the current secretary.

“White House Chief of Staff Jack Lew remains the leading contender for the Treasury job, according to the people, who requested anonymity to discuss the private talks,” the Bloomberg article said, adding, “Because Lew’s experience in financial markets is thin, Obama may seek to name a Wall Street executive as deputy Treasury secretary, the people said.”

Not exactly a confidence-building move, since we know the debate on raising the debt ceiling and cutting spending will be contentious.

According to Bloomberg, American Express CEO Kenneth Chennault was also approached about the Cabinet position, but “Chenault has indicated to the administration he isn’t interested in leaving the private sector.”

Read the full Bloomberg report here.


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