Discharge Incapable Commanders

摘要

President obama should take a cue from his hero, Abra-ham Lincoln. During the Civil War Lincoln never hesitated to fire generals he thought weren't up to the task. Obama should do the same thing with his economic commanders. Clearly Treasury Chief Timothy Geithner has been about as effective in fighting the credit crisis as George McClellan or Joe Hooker were in fighting Robert E. Lee's Army of Northern Virginia. Geithner has been in the midst of this crisis since it erupted in the summer of 2007. You would think he'd have been ready for decisive, bold action as soon as Obama took the oath of office. Instead, he has discour-rnaged markets with his vague generalities. Why hasn't he persuaded the President to do away with the debilitating accounting principle of mark-to-market? Roosevelt suspended it in 1938, but it came back under the auspices of the Bush Administration. With that political pedigree, getting rid of it should be a no-brainer. More substantively, mark-to-market has been demolishing financial balance sheets with book losses.