After months of speculation that Treasury Secretary Timothy Geithner would step down after the debt ceiling was raised, he told the President on Friday that he would stay.
"Secretary Geithner has let the president know that he plans to stay on in his position at Treasury," according to a statement issued by Assistant Secretary for Public Affairs Jenni LeCompte. "He looks forward to the important work ahead on the challenges facing our great country."
"The President asked Secretary Geithner to stay on a Treasury and welcomes his decision," said White House Press Secretary Jay Carney.
Geithner was heavily involved in negotiations to raise the debt ceiling. He was expected to step down after the grueling debate, the stress of which must have taken a toll on Geithner. He had already moved his family back to New York so his son could finish his senior year of high school in their home city.
Geithner is the only remaining member of President Obama's original economic team. Peter Orzag left a year ago as Director of the Office of Management and Budget, and was replaced by Jack Lew. Lawrence Summers, former President of Harvard and Treasury Secretary under President Clinton, stepped down as Director of the National Economic Council at the end of last year. He was replaced by Gene Sperling.
With speculation that Geithner would step down, critics were already arguing that rookies would staff the White House at a time when the economy is the top concern of the nation.
Geithner has reportedly been influential behind the scenes. He and Orzag had become the fiscal hawks in the administration at a time when others were calling for more stimulus spending. It was Geithner who urged President Obama to “go big” in the debt ceiling negotiations and try to negotiate a deal that would reduce budget deficits by $4 trillion over 10 years, which became Obama's signature position in the last month before a debt ceiling compromise was reached.
A few days after the debt ceiling battle ended, and the same day that Geithner decided to stay on at the Treasury Department, a new crisis emerged when Standard & Poor's (S&P) announced a downgrade of the nation's credit rating on Friday.
Geithner spent most of the day Friday trying to convince S&P to reconsider their decision and he has been sharply critical of S&P since then. In an interview with The New York Times, Geithner said, “I think S&P has shown really terrible judgment, and they’ve handled themselves very poorly. And they’ve shown a stunning lack of knowledge about basic U.S. fiscal budget math. And I think they drew exactly the wrong conclusion from this budget agreement.”
When asked why he decided to stay in his position, Geithner replied, “I believe in this president ... I believe in what he’s trying to do for the country. I love my work. And I think if a president asks you to serve, you have to do it.”