Ending Booms and Busts

Treasury Secretary Tim Geithner made the Sunday talk show rounds this morning discussing the economic “mess”, the AIG bonus debacle and “his plan to involve private investors in the government’s effort to help banks clean up their “toxic assets.”’

Geithner had been under fire of late and had become the Obama administration’s “whipping boy,” but he’s now bouncing back to be the “comeback kid,” as ABC’s “This Week” host George Stephanopoulos noted this morning.

Geithner told Stephanopoulos, “We’re facing, still, a lot of challenges. You can’t judge a plan on the reaction one day, one week. But we’ve done a lot in these eight weeks.”

Geithner stressed that “he sees permanent changes ahead for the economy.”

On NBC, Gregory showed the TIME magazine cover with a red “Reset” button and the provocative headline, “The End of Excess: Why this crisis is good for America.”

“I think the adjustment to a period of excess is necessary,” Geithner said. “You never want to have a crisis to remind people of the importance of living within your means, not borrowing too much, or why regulation is important. You never want to have a crisis this damaging to make that point.

“But we’re going to emerge stronger from this. When we get through this, people are going to care less about what they make, more about what they do. What they achieve is what they make. And that will help make this country stronger.”

Gregory asked if consumption will change.

“I think people will be living within their means more, which is helpful,” Geithner said. “We want end this pattern of having booms and busts … with the kind of frequency you’ve seen.”

It’s going to be a long tough climb for a lot of Americans but the hope for everyone is that we will pull out of this mess, sooner than later. Living on the edge, after living comfortably is a hard place to be. The TARP is now reported to be at a low, and Geithner would not commit today on whether more bailout money would be needed. Time will tell

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