Monday, August 8, 2011

'US Treasury Secretary will not resign'

US Treasury Secretary Timothy Geithner

Source: Press TV

The US Treasury Department has announced that Secretary Timothy Geithner will not quit despite demands for the move by the Republican Party which blamed him for the fall of US credit rating.

"Secretary Geithner has let the president know that he plans to stay on in his position at Treasury," said Jenni LeCompte, spokeswoman for the Department of the Treasury in a Sunday statement.

Geithner told US President Barack Obama that he plans to remain in his job through the fall of 2012, AP reported.

Republican lawmakers have called on the US president to dismiss Geithner after Standard & Poor's credit agency announced on Friday that it intends to lower the Triple-A credit rating of the US for the first time ever.

In April, Geithner insisted that there was no possibility that the US debt would be downgraded despite a warning from the agency.

Republican Senator Jim DeMint of South Carolina said Obama should "demand" that Geithner resign "and immediately replace him with someone who will help Washington focus on balancing our budget and allowing the private sector to create jobs."

"For months he opposed all efforts to reduce the debt in return for a debt ceiling increase," DeMint said.

"His opposition to serious spending and debt reforms has been reckless and now the American people will pay the price," he added.

Kentucky Republican Senator Rand Paul also blasted Geithner, saying he should quit over his "gross mismanagement of federal economic policy."

According to a recent default-preventing debt bill passed by the US Congress, the country's debt ceiling was raised by $2.4 trillion, to the level of $16.7 trillion, just a few hours before the August 2 deadline.

The bill was passed under public pressure, expressing intense displeasure over persistent bickering between the dominant Democratic and Republican parties over budget cuts and tax hikes and despite major reservations by members of both parties.

Some Democratic members of Congress described Republican refusal to give in to tax-hike demands for the wealthy as "terrorism" while Republicans slammed Democrats for threatening the US national security by also targeting the defense department for budget cuts.

Nouriel Roubini, chairman of Roubini Global Economics LLC and the man who predicted the 2008 financial crisis, said that the US economy is in for a double-dip recession.

"They can blame the market volatility for the downgrade. But in reality US did contribute to the debt crisis," he told Bloomberg.

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