For Immediate Release
Sam Husseini, (202) 347-0020; or David Zupan, (541) 484-9167
Treasury Pick and Openness
WASHINGTON - Timothy Geithner, President-elect Obama's nominee as Treasury Secretary and president of the Federal Reserve Bank of New York since 2003, has had his Senate hearing postponed until Jan. 21.
Professor of public affairs at the University of Texas at Austin, Auerbach wrote the book Deception and Abuse at the Fed: Henry B. Gonzalez Battles Alan Greenspan's Bank.
He said today: "During the nomination hearings for Secretary of the Treasury, Timothy Geithner should be asked for the details of the negotiations that have been conducted by the Fed that may now amount to over $2 trillion in loans. Have the Fed's recent loan policies been conducted in the backroom without a complete paper trail for the taxpayers and elected officials?
"Last week it was reported that New York Federal Reserve President Geithner was involved in the 1998 Fed-orchestrated private bailout of LTCM [Long-Term Capital Management] by private-sector banks. LTCM had earlier rejected a bailout offer from Goldman Sachs, AIG and Berkshire Hathaway. When he appeared before the House Committee on Financial services, Greenspan could not or would not tell Congress the details of the bailout, apparently because the nation's central bank produced no detailed public records. The testimony of the Greenspan Fed did not indicate the existence of a paper trail. Members of the Committee on both sides of the aisle attacked the backroom deals of the nation's central bank.
"These actions put the Fed in the same league as the tycoons of an earlier age, such as John Pierpont Morgan, whose financial deals in the 1907 financial crisis were made out of sight of the public or its elected officials."
Auerbach was an economist with the House Committee on Financial Services including during a period when Texas Congressman Gonzalez attempted to achieve a level of meaningful oversight over the Fed. Gonzalez was continuously thwarted by Greenspan.
This is the world we live in. This is the world we cover.
Because of people like you, another world is possible. There are many battles to be won, but we will battle them together—all of us. Common Dreams is not your normal news site. We don't survive on clicks. We don't want advertising dollars. We want the world to be a better place. But we can't do it alone. It doesn't work that way. We need you. If you can help today—because every gift of every size matters—please do. Without Your Support We Simply Don't Exist.
A nationwide consortium, the Institute for Public Accuracy (IPA) represents an unprecedented effort to bring other voices to the mass-media table often dominated by a few major think tanks. IPA works to broaden public discourse in mainstream media, while building communication with alternative media outlets and grassroots activists.