Treasury Sec. Geithner portrayed as both savior and too cosy with Wall Street

Treasury Secretary Tim Geithner says that key aspects of the economic policies enacted have been successful, according to new profiles of the Treasury Secretary in The New Yorker and The Atlantic which might come as a surprise to many Americans.

Geithner, who's been widely disparaged for his handling of the Wall Street bailout, is depicted as a skillful technocrat unafraid of making unpopular decisions. President Obama’s chief of staff Rahm Emanuel is quoted as saying that Geithner's role in rescuing the financial sector and avoiding an outright nationalization of banks had saved the United States taxpayer a trillion dollars.

The New Yorker piece focuses on Geithner's reputation on the 2009 bank stress tests which restored much needed confidence into the financial markets. The piece’s author proffers that the Obama administration's only two options to resolve last year’s financial crisis were whether to nationalize struggling U.S. banks or to rely on private capital markets to boost the financial sector.

Geithner called for the private capital markets course, and used the stress test results to encourage investors to pour private capital into the banks. The New Yorker reported that the Obama administration reserved nationalizing banks as a weapon of last resort.

According to the piece, the capital markets were able to determine which banks were struggling and which needed more capital as a result of the stress tests; and Geithner seems to already be patting himself on the back.

The Atlantic profile also credits Geithner with saving the economy, but is more critical of Geithner's tenure. Its author portrays Geithner's legacy as one that will be linked not just to public outrage but to how Wall Street fits into Washington's core values.