Treasury Secretary Nominee Timothy Geithner’s failure to pay four years’ worth of self-employment taxes for Social Security and Medicare is absolutely astonishing. And as more details are released, Geithner’s actions seem even more disturbing.
According to the New York Times, Geithner still didn’t correct the same type of error for some years, even after the Internal Reveue Services flagged him for the failure to pay the taxes in other years. To have him leading the department that manages the IRS would be a slap in the face to the millions of self-employed Americans who fulfill their responsiblities to correctly asses their tax burdens.
These disturbing details paint a picture of a nominee who hasn’t been fully vetted. As I have written in the Washington Examiner and the American Spectator, unlike previous Treasury Secretary nominees, Geithner had not distinguished himself as a corporate leader or as an academic economist. His only significant policy accomplishment has been his role in the Bush-Paulson bailouts.
And disturbing details are emerging about his misjudgments in this policy area as well. According to the Bloomberg wire service, Geithner pushed for Citigroup to take over the operations of Wachovia Corp. at taxpayer expense, even after Wells Fargo’s offer to purchase the firm without taxpayer backing. Had Geithner prevailed, who knows how much more trouble the financial system would be in given Citigroup’s current financial troubles.
President-Elect Barack Obama has nominated many well-qualified candidates to serve in his administration, and, despite some policy disagreements, CEI scholars have praised his choices for posts in the Securities and Exchange Commission, the Federal Communications Commission, the Department of Housing and Urban Development, and the Department of Agriculture. But in this choice for the Treasury Department, the Obama transition team members clearly dropped the ball. In an effort to please some on Wall Street and keep the bailouts going, they glossed over their nominee’s credentials and judgment.
Geithner’s errors and/or misjudgments make him unfit to serve as Secretary of the Treasury. His nomination should be withdrawn, and, if this does not happen, should be voted down by the Senate.