At one level, at least, it’s difficult to understand why Timothy Geithner is a lock to be confirmed as Secretary of Treasury. Geithner, after all, did not pay the taxes he owed on his IMF income even though he received reimbursement from the IMF for the money he should have paid to the government. And, as Secretary of Treasury, Geithner will be in charge of the IRS. One might think that, at a time of an economic crisis commonly said to have been caused by irresponsibility on the part of the financial elite, Geithner’s failure properly to pay his taxes would be a deal-breaker.
The counter-argument seems to be that, precisely because of the financial crisis, we need Geithner at Treasury. The theory seems to be that no one else has the acumen to run the Treasury Department in this time of turmoil.
There is, though, at least one person who, according to the same conventional wisdom that exalts Geithner, could run Treasury at least as well as Geithner. That man is former Secretary of Treasury Lawrence Summers.
Unfortunately, Summers committed an offense far graver in a potential Treasury Secretary than non-payment of taxes owed. He expressed politically incorrect views about why there are more men than women in high-end science and engineering positions.
JOHN adds: I find it remarkable that the Senate is willing to overlook the fact that Geithner failed to pay his self-employment taxes for four years, even though 1) he was specifically told by the IMF that he needed to pay these taxes, 2) the IMF gave him additional compensation specifically earmarked for paying his self-employment taxes, 3) Geithner signed a form stating that he would use this additional compensation to pay his self-employment taxes, and 4) when he was audited by the IRS and his failure to pay self-employment taxes was discovered, he belatedly paid those taxes for 2003 and 2004, but not for 2001 and 2002 because the statute of limitations had run on those years and he couldn’t be prosecuted for his failure to pay the taxes he owed.
I’m not sure whether Geithner should be confirmed or not; I’ve met him and found him a pretty impressive guy, and I think that in general a President should get the Cabinet officials he wants. But I will say this: if Geithner were a Republican with the same tax-scofflaw record, there is not the chance of a snowball in Hell that he would be confirmed.
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