Bailout Program Reform
Geithner told lawmakers, many of whom are upset at how the government's $700 billion financial rescue program has been run, that the Obama administration would require banks receiving government money to document increased lending.
"We have to fundamentally reform this program to ensure that there is enough credit available to support recovery," he said.
Geithner pledged measures to ensure credit flows to consumers and businesses, but stopped short of offering specifics on how that might be done.
He also said it was possible the administration could establish a "bad bank" to soak up toxic assets. "It is possible that something there will be part of the solution going forward," he said.
But “Geithner talked more negatively about bad bank than I thought he would,” adds Liesman.
While he is widely expected to win Senate confirmation, Geithner faced sharp questioning over his failure to pay some taxes when he worked for the International Monetary Fund earlier this decade.
The disclosure last week that Geithner underpaid self-employment taxes by around $34,000 has cast a cloud over his nomination. The errors, since corrected, were seen as particularly problematic because the Treasury oversees the Internal Revenue Service, the nation's tax collection agency.
"These were careless mistakes. They were avoidable mistakes. But they were unintentional," Geithner said. I want to apologize to the committee for putting you in the position of having to spend so much time on these issues."
The committee is expected to vote on his nomination on Thursday, clearing the way for approval by the full Senate by the end of the week.
"You're going to be confirmed," Republican Sen. Pat Roberts of Kansas predicted.
> Geithner Urges Bailout Reforms
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