The Wall Street Journal has some interesting reporting this morning on Tim Geithner—reporting that doesn’t do him any good. But the paper fumbles the execution of the story here with a dumb headline and a top that focuses too much on Washington image-making instead of stuff that actually matters.
Too bad, because the Journal has some good new information confirming how Geithner has moderated the administration’s stance toward Wall Street—something that’s got it into serious political trouble:
Interviews with dozens of government officials show that Mr. Geithner has acted as a brake on administration officials seeking punitive action against big financial firms.
He’s done that by preserving Vikram Pandit’s job at Citigroup, defending paying out $165 million in bonuses to the AIG Financial Products folks, and pushing to get Wall Street out from under TARP regulations. This is all unsurprising but good to know.
Also unsurprising: Geithner’s political tin ear:
In August, Mr. Geithner asked Treasury staff members to look into whether it would make sense to tax banks’ financial transactions to recoup Troubled Asset Relief Program losses. He told staff to not broach the topic with the White House until he gave the go-ahead, because he didn’t want to “give oxygen” to the tax idea before it could be thought out.
Meanwhile, however, others began calling for a transaction tax, including U.K. Prime Minister Gordon Brown and House Speaker Nancy Pelosi. The result: By the time Mr. Obama rolled out his own bank-fee plan in January, it appeared to many a defensive move.
Barry Ritholtz says the WSJ misplays the story—particularly with an off-key headline—and he’s right. “Bailout Anger Undermines Geithner” doesn’t get at the good stuff contained here and much of the top seems misplaced. Parts of the piece feel like they’ve been shoe-horned in to fit an editor’s wishes.
The headline misses the nuance of the story: That Geithner is very much a creature of the Banks he is supposed to regulate; that he continued the same ruinous bailout policies he was a part of when they began under Bush/Paulson; that he has stood as a speed bump preventing more aggressive regulation of the banks that caused the mess.
The problem with the story is perhaps best seen in the WSJ Online headline: “Bailout Anger Hurts Geithner’s Public Image, Effectiveness.” I think that more accurately sums up how the story actually reads than the paper’s headline.
The New Yorker‘s George Packer wrote an outstanding post last week on Washington journalism’s obsession with image over substance. It’s revealing that the Journal would put it “Public Image, Effectiveness” rather than “Effectiveness, Public Image.” Because the latter is what is really going on isn’t it? That Geithner’s public image, for what that’s worth, is being harmed by his ineffectiveness on what people really care about? Packer:
Anyone covering Washington, not excluding me, will sooner or later turn to a phrase like “refocus its image” or “a perception that the President has come to look” or “a pitch-perfect recital of the populist message,” because they come so easily, and because they make it unnecessary to say anything substantial, which means thinking hard and perhaps suffering the consequences.
The WSJ:
Yet to some lawmakers, Mr. Geithner looks weak. His association with unpopular financial bailouts has become an albatross. His neutral rhetoric on bankers’ bonuses—the fat payouts are “very hard for people to understand,” he recently told CNBC—spurs talk that he coddles Wall Street.
Lawmakers have been bickering for months over Mr. Geithner’s regulatory revamp. Despite renewed confidence in the banks and a growing economy, Mr. Geithner gets little credit. His unwillingness to play the populist makes him an ineffective pitchman for an administration eager to defuse public anger over unemployment and the housing crisis.
To boost his image, Mr. Geithner is waging a charm offensive. On Friday he toured a supermarket in Philadelphia with first lady Michelle Obama to showcase efforts to reduce childhood obesity, an unusual event for a Treasury secretary. He demonstrated how a Treasury program offering tax credits in low-income communities can bring in businesses selling more nutritious food.
Mr. Geithner says even his wife has urged him to show more emotion in confronting the banks. His response to her: Doing so risks politicizing the Treasury.
The Journal‘s own excellent reporting, in the paragraphs that follow, show that the image and the reality are one and the same. Why does it need to play along with the Washington game?
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.