MR. McCAIN.  Mr. President, I regret that I must oppose the nomination of Timothy Geithner to be the next Secretary of the Treasury.  I assure my colleagues, I did not reach this decision lightly, but, rather after much thoughtful consideration.  Next to the confirmation of Supreme Court Justices, the Senate has no more important duty than the confirmation of members of the President’s Cabinet.  Throughout my time in this body I have held the view that elections have consequences and that – barring any extraordinary circumstance – the President should be free to pick his team and surround himself with those he feels can best assist him in attaining his goals.

 

Mr. Geithner’s involvement in the failed policies behind the misuse of hundreds of billions of taxpayer dollars in the Troubled Asset Relief Fund (TARP) has led me to conclude that an extraordinary circumstance exists in this situation.  Mr. Geithner played a critical role in the creation of the TARP and should be held accountable for the fact that it has been terribly mismanaged and has not achieved its intended results.  Unfortunately, Mr. President, I have come to believe that Mr. Geithner lacks the critical judgment necessary to be an effective Treasury Secretary and careful steward of taxpayer dollars.

 

To properly weigh a potential cabinet member’s qualifications, it is important to pay close attention to the Committee hearings held to consider the nomination and the views expressed by both the nominee and Members of the Committee.  After Mr. Geithner’s testimony before the Senate Finance Committee, a very well-respected Member of the Committee stated that "I don't believe that the requisite candor exists for me to indicate my support for him with an affirmative vote."  Another member of the Committee stated that, “Mr. Geithner has been involved in just about every flawed bailout action of the previous administration.  He was the front-line regulator in New York when all the innovations that recently have brought our markets to their knees became widespread. . . . All those actions, or failures to act, raise questions about the nominee's judgment.”  I fully agree with my colleagues’ sentiments, Mr. President. 

 

I am deeply troubled by Mr. Geithner’s role in the mismanagement of the TARP.   He has enthusiastically supported failed policies that have cost the taxpayer hundreds of billions of dollars.  Earlier this month, I voted with 41 of my colleagues in opposition to releasing the remaining $350 billion TARP funds because I had seen no evidence that the additional and substantial taxpayers’ money would be used for its intended purpose.  TARP was created to allow the Treasury Department to purchase up to $700 billion in “toxic assets” from financial institutions in order to help homeowners facing foreclosure and to stimulate the economy.  The misuse of the first $350 billion of TARP funds combined with the lack of transparency promised by the Treasury Department were reasons enough to oppose releasing additional funds.  It is my strong opinion that no further TARP funds should be released until we are able to impose strict standards of accountability and ensure that the money is spent only as intended by Congress – to purchase mortgage-backed securities and other troubled assets. 

 

Unfortunately, I have seen no evidence that Mr. Geithner shares that view.  He has stated that more oversight and transparency are necessary, but to date he has offered no specifics about how the remaining $350 billion in TARP money would be spent, and has laid out no criteria for serious oversight and accountability of such substantial sums of taxpayer dollars.

 

Mr. President, with no regard for Congressional intent, and with the support of Mr. Geithner, the Treasury Department has used TARP funds to prop up the banking industry and to guarantee securities backed by student loans and credit card debt.  But most troubling to me has been the use of TARP funds to help bail out the domestic auto industry – in direct defiance of Congress.  Last month, after extensive discussion and debate, the Senate rejected a plan to pump billions of federal dollars into the domestic auto industry because we saw no evidence of serious concessions from the industry and no assurance of the domestic auto manufacturers’ long-term viability.  When asked about the use of TARP funds to further assist the domestic auto industry, Mr. Geithner indicated he would support further funding as long as it was accompanied by “a comprehensive restructuring” of the auto industry.  Again – he offered no specifics.

 

Mr. President, the American people can no longer afford ambiguous assurances of transparency, accountability, and reform.  They need and want specifics and particulars – and the person leading the U.S. Treasury should be able to provide the American taxpayer with the details they seek.