Treasury Secretary Timothy F. Geithner on Wednesday denied that a slow staffing process in his department has made it hard for foreign officials to reach him as they try to prepare for next month’s G-20 summit.
Speaking to close to 100 reporters in the Treasury Building, Geithner said he was “a little surprised” by the reports that British officials have complained about the difficulty they’ve had in getting through to their American counterparts.
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“We’ve been working very closely with British officials,” Geithner said.
The secretary also followed the president’s lead in trying to tamp down rumors of a rift between the U.S. and the European Union on whether concerted stimulus spending or global financial regulatory reform should be the top priority at the summit, which takes place in London on April 2.
“We’ve got these two critical objectives. They’re both important. We need to move together on them,” Geithner said.
The session with reporters went about 30 minutes and included Geithner’s announcement that he wants to expand the International Monetary Fund’s reserve balance from $50 billion to $500 billion so that the fund is ready to step in if any major economies in Europe collapse.
“The NAB — this is like an emergency reserve fund for the IMF — really needs to be dramatically expanded,” Geithner said. “We want it to be large enough to be effective and credible in response to a crisis of this magnitude. It’s a very dramatic expansion.”
Beyond Ukraine and Iceland, countries such as Greece and Ireland are in danger of financial implosion and could drag their respective regions down with them if they are not stabilized from outside.
Geithner also announced that the U.S. wants the IMF to report each financial quarter on whether G-20 nations are meeting an IMF marker to spend 2 percent of the total economy on fiscal stimulus, through 2010.
“If you look at the IMF estimates of what’s likely to happen on the current path of fiscal policy across the major economies, they show a substantial diminution of fiscal support in 2010, and it’s our judgment and the IMF’s judgment that we’re going to need … a substantial but sustained commitment to make sure there is support for demand in place,” Geithner said.
And the Treasury secretary said that the Federal Reserve “is the natural place” to serve as a coordinator of global regulatory efforts.
— Jon Ward, White House reporter, The Washington Times
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