Obama faces losing his economic supremo Timothy Geithner just when he needs him most

Treasury Secretary set to quit before battle over US debt ceiling

New York

President Barack Obama may be forced to accept the imminent departure of his Treasury Secretary, Tim Geithner, despite the looming political fight over raising the national debt ceiling.

Mr Geithner has been by Mr Obama’s side from the start of his White House stint and has had a voice in every major budgetary debate – including attending the latest emergency Oval Office meeting on the “fiscal cliff” with Congressional leaders last Friday.

But he has made no secret of his desire to step back from politics. Speculation in the wake of the 2011 debt ceiling deal suggested he might step down before the 2012 election, but he was said to have changed his mind at Mr Obama’s request.

Though it is possible he could be persuaded again, preparations for his departure continue, despite the coming debate over raising the debt ceiling, the congressionally mandated limit on the federal government’s ability to borrow. Mr Geitner reportedly intends to depart by the end of January regardless of whether there is agreement on the ceiling between the Congress and the White House. “Secretary Geithner has previously stated that he plans to be at Treasury until around the inauguration,” a Treasury spokesperson said in response to the reports.

His departure is likely to complicate matters for Mr Obama, who is faced with replacing an experienced advisor who has played a role in every major fiscal debate during his presidency and who also played a critical part in the financial crisis of 2008. As Lehman Brothers teetered on the edge, Mr Geithner was in charge at the New York Federal Reserve and had a key voice in the debate leading up to and immediately following Lehman’s collapse in September 2008.

Jack Lew, the President’s chief of staff, who served as the head of Mr Obama’s Office of Management and Budget and also held the post under Bill Clinton, is being touted as the most likely replacement. 

But questions have been raised about his experience with financial markets. Although he spent more than two years at Citigroup, his Wall Street CV is weaker than Mr Geithner’s. The White House might get around this by picking someone with stronger Wall Street credentials as Mr Lew’s deputy.

Another possible alternative is Laura Tyson, the former chair of Mr Clinton’s council of economic advisors. Currently a professor at the University of California, Berkley, she would be the country’s first female Treasury Secretary.

Could a trillion dollar coin be the solution?

Armchair economists have hit upon an unorthodox way to fix the US debt problem.

Thanks to a legal quirk, one of Tim Geithner’s last acts in office could be to mint a single platinum coin with a face value of $1 trillion (£620bn) and deposit it in the Federal Reserve, putting an abrupt end to Congressional bickering by wiping out most of the deficit at a stroke.

The notion was dismissed by the New York Times columnist Paul Krugman as a “gimmick”, but the #MintTheCoin Twitter hashtag translated into a White House petition, urging the Obama administration to mint and deposit the coin. At the time of writing the petition had just 1,626 signatures.

Start your day with The Independent, sign up for daily news emails
Sport
sportSo, how closely were you paying attention during 2014?
Arts and Entertainment
Dennis speaks to his French teacher
tvThe Boy in the Dress, TV review
News
One father who couldn't get One Direction tickets for his daughters phoned in a fake bomb threat and served eight months in a federal prison
people... (and one very unlucky giraffe)
Arts and Entertainment
Joel Edgerton, John Turturro and Christian Bale in Exodus: Gods and Kings
film
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
News
i100
Arts and Entertainment
The Plaza Theatre in Atlanta, Georgia was one of the 300 US cinemas screening
filmTim Walker settles down to watch the controversial gross-out satire
Arts and Entertainment
Amy Adams and Christoph Waltz in Tim Burton's Big Eyes
film reviewThis is Tim Burton’s most intimate and subtle film for a decade
Life and Style
Mark's crab tarts are just the right size
food + drinkMark Hix cooks up some snacks that pack a punch
Arts and Entertainment
Jack O'Connell stars as Louis Zamperini in Angelina Jolie's Unbroken
film review... even if Jack O'Connell is excellent
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Ashdown Group: Senior Marketing Executive- City of London, Old Street

£40000 - £43000 per annum + benefits: Ashdown Group: Senior Marketing Executiv...

Ashdown Group: Marketing Manager

£40000 - £43000 per annum + benefits: Ashdown Group: An international organisa...

Ashdown Group: Internal Recruiter -Rugby, Warwickshire

£25000 - £30000 per annum: Ashdown Group: Internal Recruiter -Rugby, Warwicksh...

Day In a Page

Aren’t you glad you didn’t say that? The worst wince-and-look-away quotes of the year

Aren’t you glad you didn’t say that?

The worst wince-and-look-away quotes of the year
Hollande's vanity project is on a high-speed track to the middle of nowhere

Vanity project on a high-speed track to nowhere

France’s TGV network has become mired in controversy
Sports Quiz of the Year

Sports Quiz of the Year

So, how closely were you paying attention during 2014?
Alexander Armstrong on insulting Mary Berry, his love of 'Bargain Hunt', and life as a llama farmer

Alexander Armstrong on insulting Mary Berry and his love of 'Bargain Hunt'

From Armstrong and Miller to Pointless
Sanchez helps Gunners hold on after Giroud's moment of madness

Sanchez helps Gunners hold on

Olivier Giroud's moment of madness nearly costs them
A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect