Geithner Wins Tug-of-War for Hands-Off Bailout

Treasury secretary resists calls for firmer government intervention
By Rob Quinn,  Newser Staff
Posted Feb 10, 2009 1:49 AM CST
Treasury Secretary Tim Geithner, center, sits with National Economic Council Director Lawrence Summers before the arrival of President Barack Obama in Washington last week.   (AP Photo/Charles Dharapak)
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(Newser) – Treasury Secretary Timothy Geithner has prevailed over top administration officials who sought tougher restrictions on financial institutions in the revamped bailout plan to be unveiled today, reports the New York Times. Geithner, pointing to failures in countries that adopted more interventionist measures, successfully resisted calls to dictate how the cash is spent, to oust execs at bailed-out banks, and to broaden limits on executive pay.

Geithner feared that too much government involvement would hurt the bailout's chances of success and scare off crucial private investors. Administration officials acknowledge that there were plenty of differences of opinion as the plan was being put together, but stress that they're happy with Geithner's final product.