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American Banker Columnist Susan Ochs on Obama’s nomination of Jack Lew as Treasury Secretary.
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Our next guest believes president Obama's pick to replace Timothy Geithner us Treasury Secretary is a steady hand -- on substance.
Joining us to talk about Jack -- in the long suppressed -- debt ceiling fight is not.
It has served at the Treasury Department in both the Clinton and Obama administration's currently senior fellow at institute season one but -- they be here.
So jobless claim to fame.
Serving as the budget director under President Clinton coming to a bipartisan agreements not only balance the budget back to create a surplus at ever -- Arms about this nomination expensive -- army.
I agree with you I think.
Nobody has -- veterans man Washington for deficit reduction than somebody like Jack -- In addition to that he was actually an -- To.
House speaker Tip O'Neill in the eighties and then in the now historic 1983 performance Social Security -- he knows how to do entitlement reform -- I think that the Republicans really are just sort of -- you know as this partisan here this is not really -- and -- Over the past three years though as chief of staff and as budget director.
US has run deficits over a trillion dollars a year with no shrinkage -- growing.
And the rate of that growth has -- of contention there -- some criticism on Lou about how -- characterize.
That budget right in a lot of that that criticism again I would call that sort of more partisan here than actual reality if you look at there is that.
There's an interview that he did it -- that two years ago when -- president was proposing his budget and what he was trying to say was that.
Spending on government programs.
Was going to now balance out with the revenues that we were taking into and be equalized now they would continue to be.
Smaller much smaller.
I'm running deficits but that was all interest payments -- that was in the financing issue not a core scope and size of government issue.
And so they're trying to make -- and say well the semantics of the way he said it would really misleading but in fact that's not the case is -- just as simple as Republicans don't like Lou because he's such -- tough negotiator.
I think that that's a part of it idea.
And I also think that.
You know at this is an environment where we're seeing everybody except potentially John Kerry -- seeing every nomination that comes up criticized for something even Republicans even one of the rally in tech -- all of -- sudden.
You know he's not he's -- you know not good enough for that -- in number respect so.
I think the backdrop of the environment that President Obama was working in in his first term.
As some of the political dynamics were different certainly than when Jack leave base -- the penetration but I do think again and I think that he's -- really solid choice and if anybody has -- hope of getting something done.
We have some huge -- ahead -- -- debt ceiling we're approaching its restoration with fifty cents.
Cuts coming we note that -- is right on par with the president supporting spending increases though because it is a whole new time.
Lot of Republicans and argue that's days of the surplus are long gone it's a whole new -- sign of the times right now he mentioned he's in favor of entitlement reform.
What's the likelihood of getting a grand bargain is this going to be a much tougher fight now we -- -- -- cabinet.
Eight it is it it's a -- it was going to be tough but regardless I think that you know some -- like Jack -- again you know he he's seen it done before and but the -- that they got reform done in 1983 was that James Baker who is the chief of staff at the time.
Sat down with Tip O'Neill you know at somebody's house slid 9 o'clock at night and they find it the sign the final agreement and we don't have that kind of environment anymore where people can kind of -- off in the dark of night comes the deal that maybe that's good for sort of that -- sunshine laws and you know and people and if it was happening politics.
But with the intense media scrutiny and they dated -- need to now to what's happening negotiations it is hard to get a deal that I'd love to see a lot -- of -- -- Camp -- -- -- and diabetic -- any kind of -- agreement what likelihood of us that actually get a meaningful spending cuts with this debt ceiling debate I mean the president's basically not interested at all it seems.
To accept any kind of spending cuts whatsoever and to -- Republicans get any had any leverage if anything done on our you know I think there's there is opportunity to have a responsible conversation around spending cuts don't forget even that budget that was criticized station but anything actually done -- -- -- It's possible that that budget that was criticized from two years ago the president have proposed some pretty drastic spending cuts.
I had actually frozen all non security discretionary spending for five years I completely held -- -- Which is not something that again a lot of the Democrats would be so happy about that they would kind of follow the president if he really felt like there was a deal on the table so.
I think it's possible I think it's probably a little less likely the -- was you're tuned out.
But out -- do you think it's possible miss my little premature but we know Bernanke's at Federal Reserve is gonna leave at the end -- term treasury and fed obviously very close working relationship.
I think that will unfold well he would have been -- both say maybe Tim Geithner would have got to have the Federal Reserve in no way I would.
Done with I guess when you think I think the tired of you want you detox -- that was exactly I think he's had a deal.
But it it it's a very close working relationship but don't forget there -- number of people and it's not just the chairman there's an entire board and so.
If people on the board.
I'm a lot of those folks have known.
A lot of folks administration for really on time -- I think that there will continue to be a very close working working relationship there.
And handicap and expect she might be.
Hot hot hot yeah -- not expect another life you know that you -- Senior advisor to the head of Troubled Asset Relief Program TARP -- Apple's iPad yet.
And so we had news this week with AIG Hank Greenberg former CEO is gonna sue the government for forcing AIG bailout.
And O'Shea the current CEO saying.
Or not getting involved in this were not part of this what are your thoughts on how this one is -- -- Well I you know the -- intact when I first saw the headline actually thought it was a satire -- that in speculative and -- real because it's so preposterous but I actually thought.
You know if we wanna truly ensure that the government is never ever bailing out -- bank again the best way for that to happen would be for AIG actually -- the government because that would that would seal the deal for everybody forever so.
When out of -- never -- -- I think Greenberg eating without AIG's current board has the case.
You know not immediately because -- the the argument was that -- whole you know Fifth Amendment seizure notion that -- fourth minute you know it.
It's it -- -- -- they could have said we want to bail -- we're just gonna crumble of the company and -- -- I don't really think they have a leg to stand on speaking you're in you're taken in -- did not thanks a lot thank you here.
