Geithner memoir: He considered resigning in 2010 and suggested Clinton as possible successor

The Associated Press

FILE - In this July 25, 2012, file photo, then-Treasury Secretary Timothy Geithner testifies on Capitol Hill in Washington. Two of President Barack Obama’s closest first-term advisers will soon spill insider details on the administration’s handling of the early days of the Great Recession, the White House’s cautious response to the Syrian civil war and the genesis of clandestine talks with Iran. The memoirs from former Secretary of State Hillary Rodham Clinton and Geithner will be the latest installments in an often awkward Washington ritual: one-time confidants signing big book contracts to examine a presidency that is ongoing and policy decisions that still are being implemented. (AP Photo/J. Scott Applewhite, File)

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By JOSH BOAK and MARTIN CRUTSINGER, AP Economics Writers

WASHINGTON (AP) — Timothy Geithner says in a new memoir that he repeatedly offered to resign as Treasury secretary in the aftermath of the financial crisis and at one point suggested that Hillary Rodham Clinton be among those considered to replace him.

President Barack Obama rebuffed Geithner's suggestion, and he remained at Treasury until 2013.

Geithner's memoir will be published next week. On Thursday, The Associated Press bought an early copy.

Geithner recalls his offers of resignation in "Stress Test," which explores his turbulent four years at Treasury. During his tenure, the Obama administration confronted the worst recession and most severe financial crisis since the Great Depression.

He portrays his offers to resign as reflecting his uncertainty about whether he was up to the immense challenges of the job. Ultimately, Geithner concludes that the economy stabilized under his watch.

In several sections of his memoir, Geithner writes of internal conversations about who might replace him in a post he had been initially reluctant to accept.

When his nomination ran into challenges over his tax filing problems, Geithner offered to pull his name from consideration. He writes that he later volunteered several times to step down from the Cabinet post if administration officials felt that doing so would boost Obama's standing at a perilous moment for the economy.

In proposing that the White House consider Clinton as a successor in 2010, Geithner cited her star power as secretary of state. Among the other names Geithner suggested was Jack Lew, who succeeded him last year.

By his own acknowledgement, Geithner seemed an awkward fit as Treasury secretary, neither an economist nor a banker nor a natural public speaker.

He found himself unable to quell what he calls the public's "Old Testament" outrage at bankers who received federal aid and cashed outsized bonus checks after the financial meltdown that erupted in 2008. At least one of those bankers, JPMorgan Chase CEO Jamie Dimon, offered to help the administration rewrite the regulations overseeing the big banks, Geithner writes. The administration declined Dimon's offer.

Clinton's husband, former President Bill Clinton, advised Geithner that publicly criticizing prominent bankers, such as Goldman Sachs' CEO Lloyd Blankfein, wouldn't appease ordinary Americans.

"You could take Lloyd Blankfein into a dark alley, and slit his throat, and it would satisfy them for about two days," Geithner recalled Clinton telling him. "Then the blood lust would rise again."

Geithner notes that easy money and risky behavior fueled the housing bubble and led to the financial crisis. Deceit and fraud by some financial institutions, he writes, were a component of the mania. But they weren't its primary cause.

No Treasury secretary since the Depression confronted so many financial threats at once. When Geithner became Treasury secretary in January 2009, the economy had sunk into a deep recession. Unemployment was surging, and the financial system was teetering.

Having previously led the Federal Reserve Bank of New York, Geithner had worked to craft the government's early response to the financial crisis. The crisis erupted in the fall of 2008 with the fall of investment bank Lehman Brothers and the government takeover of mortgage giants Fannie Mae and Freddie Mac

Geithner's supporters said he deserved credit for helping steady the banking system, restore investor confidence and avert a complete meltdown.

His critics countered that his policies consistently favored big banks and neglected ordinary Americans, including many struggling to save their homes after a wave of foreclosures followed the housing bust.