by Frank James
The Obama presidential transition issued a statement responding to disclosures that Tim Geithner, President-elect Barack Obama's choice for Treasury Secretary, once employed an immigrant domestic worker with an expired work authorization and initially failed to pay Social Security and Medicare taxes when he worked at the International Monetary Fund.
Here's the statement:
"The President-elect chose Tim Geithner to be his Treasury Secretary because he's the right person to help lead our economic recovery during these challenging times. He's dedicated his career to our country and served with honor, intelligence and distinction. That service should not be tarnished by honest mistakes, which, upon learning of them, he quickly addressed. He made a common mistake on his taxes, and was unaware that his part-time housekeeper's work authorization expired for the last three months of her employment. We hope that the Senate will confirm him with strong bipartisan support so that he can begin the important work of the country," said incoming White House press secretary Robert Gibbs.
Meanwhile, Sen. Max Baucus, chairman of the Senate Finance Committee, has issued a statement as well, essentially saying he continues to support Geithner's nomination though he's "disappointed" about the mistakes:
"I am disappointed in the errors found in Tim Geithner's tax returns and other information, but I am satisfied that Mr. Geithner has taken the steps necessary to fix these problems. That's why I intend to move forward as soon as possible with a hearing on his nomination," said Baucus. "The President-Elect needs a Treasury Secretary on day one. We have to roll up our sleeves and get this economy moving again for the American people, and Tim Geithner has the right combination of experience and skill for these difficult economic times. For these reasons, I continue to support his nomination to be the next Secretary of the Treasury."
The Wall Street Journal provides good details on the underlying issues:
Sen. Charles E. Grassley, ranking Republican on the Senate Finance Committee, is raising questions about a housekeeper who worked briefly for Treasury Secretary-nominee Timothy Geithner without proper immigration papers, and multiple years when Mr. Geithner didn't pay Social Security and Medicare taxes for himself.
Senate Finance Committee Chairman Max Baucus (D., Mont.) has summoned committee members to his office this afternoon to air the matter ahead of any public confirmation hearing.
According to people familiar with the matter, Mr. Geithner employed a housekeeper whose immigration papers expired during her tenure with Mr. Geithner, currently president of the Federal Reserve Bank of New York. The woman went on to get a green card to work legally in the country and federal immigration authorities didn't press charges against her, these people said.
The second issue involved taxes due while Mr. Geithner worked for the International Monetary Fund between 2001 and 2004. As an employee, Mr. Geithner was technically considered self-employed and was required to pay Social Security and Medicare taxes for himself as both an employer and an employee.
He apparently failed to do so, resulting in Internal Revenue Service audits his last two years at the IMF. As soon as the IRS brought the issue to his attention, he paid the taxes with interest, these people said.
According to Bloomberg News, Geithner's meeting with senators in Baucus's office, allayed the concerns of some senators:
Jan. 13 (Bloomberg) - Republican Senator Orrin Hatch and Democratic Senator Debbie Stabenow said they support the nomination of Timothy Geithner as Treasury secretary after the Wall Street Journal reported Republicans raised questions about a housekeeper Geithner employed.
Hatch and Stabenow, members of the Senate Finance Committee, spoke after meeting with Geithner in the office of panel chairman Max Baucus in which the nomination was discussed.
The Wall Street Journal reported earlier today that Republicans are raising questions about a housekeeper who worked for Geithner without proper immigration papers. Republicans are also voicing concerns about Geithner's taxes while he worked at the International Monetary Fund, the Journal said, citing people familiar with the matter.
"I support him," Hatch said. Stabenow said Geithner answered questions about the issues "forthrightly."
Comments
There's part of the timeline missing -- he paid this stuff not long ago but on the day he was appointed. In other words, he only did it because he was going to get caught (per ABC).
We're supposed to trust this guy with our money?
Posted by: Beth | January 13, 2009 5:06 PM
Frank, why did you fail to expand the story to include a refresher paragraph on how Dems. and MSM relentlessly questioned this same issue to force a Republican (judge,maybe?) up for confirmation to withdraw over it? If I recall correctly this was a big issue about the hypocritical rich Republicans and affected numerous people. My how time or circumstance change when Dems. are involved. Could you enlighten us?
Posted by: Bubba Porter | January 13, 2009 5:10 PM
How does this slip by Obama's supposed "fool proof" vetting team? First Richardson and now this. It's a gold mine for Republicans already having fun with Blago, Burris and Richardson. Tax issues could be very messy for a president-elect who always says he hates drama.
http://www.political-buzz.com/
Posted by: matt | January 13, 2009 6:41 PM
Will Obama make a CHANGE and keep him-
Could be interesting.
Posted by: Inky | January 13, 2009 6:56 PM
Another corrupt Obama cabinet nominee.
This time it's a tax scofflaw. At least that's a change from Blago-bribery and Bill "pay for play" Richardson. And as far as we know Geithner didn't have any senate seats to sell.
Posted by: HopeNChange | January 13, 2009 7:18 PM
"How does this slip by Obama's supposed 'fool proof' vetting team?"
Posted by: matt | January 13, 2009 6:41 PM
.
Yep. I think we can put to rest the myth that Team Obama are the smartest kids in class.
Posted by: MJ | January 13, 2009 8:03 PM
Gee, the Obama team, so far that we know, has done a poor job of vetting Richardson, Geithner, Holder, Clinton. Or is it that Obama didn't and doesn't care? Will the media crow about this? Nope, they will just cover it up and make excuses. A corrupt media is not a free media.
Posted by: John D | January 13, 2009 11:57 PM
It's laughable to see the Republican whiners crying about Obama. They in for a long 8 years. Maybe they should all move overseas to a socialist country.
Posted by: Doug R. | January 14, 2009 8:41 AM
Our (nominated) Treasury Secretary doesn't pay his taxes? This is a joke, right? Do I still have to pay mine? I mean, what is his excuse? The lame rhetoric from Obama adorers is that it was a common mistake, etc. But this is not like Joe Sixpack missing a line on his 1040. This is suppose to be the smartest guy in the room when it comes to these issues, and you're telling me he couldn't figure out his tax forms? I don't buy it. The fact that he tried to pay up on the eve of the nomination suggests to me he had knowledge of his "mistake".
Posted by: Herbie H. | January 14, 2009 10:19 AM
When Joe the Plumber was discovered to have a $1,200 tax lien on his house, this made him suspicious in some minds…yet when the prospective Treasury Secy. has several +$40,000 tax problems, he is still on the path to confirmation.
That just goes to show that small contractors are held to higher standards than Obama cabinet officers.
Posted by: Chris | January 14, 2009 11:44 AM
Geithner probably plays basketball, so everything will be ok.
Posted by: Denny Crane | January 14, 2009 1:33 PM
“Obama stands behind Geithner”
It's unbelievable how bad the Financial industry is, both private and public. Full of people with questionable acts, backgrounds and ethics. Obama cannot be soft since he was the one espousing the tough talks and lack of regulations and ethics by Bush. Obama and his administration have no room to tolerate a man who's going to be in charge of the treasury and cannot find an accountant to review his own tax obligations. Wasn’t Obama recently quoted as saying we need more oversight on the Bailout Plan? This is a serious miss and it's better to admit to the serious mistake and choose another candidate. Obama needs to set the tone to the financial community that he has zero tolerance for this kind of history or behavior. Fiduciary trust must be re-established. By not admitting to the grotesque oversight, I think Obama will simply show how naive and weak he's going to be and will simply be run over by a bus in the tough and woolly town of Washington DC. Attempting to unite the country is one thing. Bending over like Gumby is another.
Posted by: Jerry C | January 14, 2009 6:55 PM