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Tim Geithner's confirmation hearings began today, with some focus on his tax-filing mistakes, but even more scrutiny on his role in the bailout, which, while it has stabilized the financial system somewhat, has also allowed a lot of banks to get a capital injection in exchange for little help to the overall economy. His replies to those questions have not been in-depth (I'm following along at Dealbook's live blog) but his answer to a question on the New Deal is enlightening:
12:25 p.m. | The New Deal: Talk turns to the Great Depression, and what the government did to help the United States pull out of it. Mr. Geithner says he generally supported the range of government programs and fiscal stimulus plans from that era, but suggests that there the government pulled back its economic support too early — he includes the Federal Reserve in this criticism. The strategy this time around should be “doing a lot soon, and saying with it,” he says.Geithner is rejecting the notion peddled by some that the New Deal in fact exacerbated the Great Depression. That's nice to hear.
-- Tim Fernholz
