Unemployment Number (Back to 9%) Makes Today a Perfect Day to Fire Geithner
President Obama could round out his successful week by firing Secretary of the Treasury Tim Geithner.
Obama's ill-considered decision to renew Federal Reserve Chairman Ben Bernanke's tenure last year means that there can't really be a clean sweep of the existing federal economic team.
But by replacing Geithner with a Treasury Secretary whose talents extend beyond calls for expansion of the debt ceiling, Obama could send a clear message that he has learned from the failure of the last two years.
Today the Bureau of Labor Statistics announced that unemployment is back up to 9 percent (from 8.8 percent the previous month). The administration and media are trying to finagle green shoots out of that increase, noting that a separate survey of employers shows an increase in payroll jobs. More imaginative is the claim that the increase in unemployment is the result of people returning to the workforce. The bottom line is that the official unemployment rate – not a shadow statistic or U-6 or some other fancypants measure – is increasing, and administration officials look either out of touch or deluded when they try and gussy that up.
In other words, this is the perfect Friday evening to announce that Geithner is headed home. Assuming anybody cares to ask questions once it's established that the secretary wants to spend more time with his young family or has been returned to his home planet or is staying at a dude ranch for the next year or so, the president still would have an easy task in explaining the decision: Tim did an excellent job heading off an economic collapse, banks are lending again, hundreds of thousands of mortgages in trouble have been modified through the HAMP program, we believe the pace of the recovery will pick up later this year, blah blah blah. But people are hurting and as president I had to decide that the pace of the economy is just not good enough.
It's a simple thing. As I have noted before, successful presidents replace Treasury Secretaries all the time. And Obama needs to send a feel-your-pain signal to Americans. This is a nearly cost-free way to repudiate a failed Keynesian policy and burnish the reputation for non-ideological pragmatism Obama covets. If Geithner is fired this weekend, it will look like a logical move but not like a panic move, and it will be made when the culture is feeling good about Obama anyway.