Geithner Lays Out His Bank Plan

Treasury Secretary Timothy Geithner has laid out his plan to deal with bad bank assets in a Wall Street Journal op-ed this morning. It's been dubbed the It includes a so-called Public-Private Investment Program, and more information is available here at the Treasury website. One question--perhaps a tangential one--raised by this announcement is whether or not the public will move on from AIG outrage to digest and judge the plan, and whether it will quiet calls for Geithner to step down. This excerpt, from near the end of Geithner's op-ed, speaks to the political climate in which the Treasury secretary finds himself:

Moving forward, we as a nation must work together to strike the right balance between our need to promote the public trust and using taxpayer money prudently to strengthen the financial system, while also ensuring the trust of those market participants who we need to do their part to get credit flowing to working families and businesses -- large and small -- across this nation.

This requires those in the private sector to remember that government assistance is a privilege, not a right. When financial institutions come to us for direct financial assistance, our government has a responsibility to ensure these funds are deployed to expand the flow of credit to the economy, not to enrich executives or shareholders. These provisions need to be designed and applied in a way that does not deter the participation by the private sector in generally available programs to stabilize the housing markets, jump-start the credit markets, and rid banks of legacy assets.