Geithner makes unsubstantiated claim in an attempt to establish a meme
hat do you do if you’re a politician and you promised that if you did something good results would be assured. And then you did it and, in fact, things got worse?
Well that’s the situation the administration faces. It claimed that the "stimulus" was a bit like a FedEx package – something that absolutely, positively had to be done or we would be facing horrific unemployment – over 8%. So the Democratic Congress (alone) jammed through a pure pork package of almost a trillion dollars and sure enough unemployment which was below 8% at the time, eventually shot to 10% (and has now receded to 9.5% "officially").
Faced with that, what the administration has decided to do is run Tim Turbo Tax Geithner, the Secretary of Treasury, out there and pretend like the “stimulus” worked. No, seriously, that’s their plan – damn the facts, go out and essentially say they’ve got the economy in good enough shape that they can now step back and let the private sectors take over:
Treasury Secretary Timothy Geithner said the economy has now recovered sufficiently for government to begin to make way for private business investment.
Mr. Geithner’s comments on Sunday, which echo previous sentiments expressed by President Barack Obama, reflect a turning point in the government response to the worst economic downturn since the Great Depression, a period marked by deep federal intervention in the financial, housing, auto and other industries.
“We need to make that transition now to a recovery led by private investment,” Mr. Geithner said Sunday on NBC’s “Meet the Press.”
Now that takes some stones. To pretend that government intervention has done much of anything requires Hillary Clinton’s “willing suspension of disbelief”. The GDP is limping along in the 1 to 2% growth area, debt has shot through the roof, unemployment remains stubbornly high (and higher than when government “stimulated” the economy) and legislation passed by this administration – and its legislative agenda – has businesses sitting on the sidelines with a pile of money and refusing to participate because of the unsettled business climate.
However, running this meme allows the administration to step back from its failure by calling it a success and passing the blame, now, to the private side. This can have a two-fold effect for them if they can successfully run this bluff.
For one, they can claim the private sector is to blame for continued weakness. That’s very useful to them. Why? Because it sets up what they really want – a second stimulus and more government control.
“There’s going to be a good case for the government preserving some type of guarantee to make sure people have the ability to borrow to finance a house even in a very damaging recession,” he said on “Meet the Press.”
He said the administration would begin developing such a program very soon. “We’re going to take a careful look at a set of reforms that are going to be good for the country going forward and don’t leave us vulnerable to this kind of crisis in the future,” Mr. Geithner said.
And it provides something this administration desperately wants and needs: a scapegoat.
Of course, with midterms coming soon, this may end up being an attempt that is too little and too late. But frankly I don’t think it will take. It is far too cynical an attempt to sell something that already smells terribly rotten. Just as the majority saw through the attempt by Obama to claim that the “stimulus” didn’t have a gram of pork in it (as stated earlier, it was pure pork), they’ll see through this attempt to sell “the economy is better and it’s because of the “stimulus”” that Geithner is attempting here.
This, as usual, is more about political posturing and meme creation than it is about reality. And with this administration, that’s something people have already come to recognize and dismiss.