Art Cashin, one of the talking heads on CNBC, said early on Thursday morning that the stock market was going down in part because of a lack of confidence caused by the failure of the Senate to quickly confirm Timothy Geithner as Treasury Secretary. This was the party line of the Wall Street insiders who have a special interest in getting Geithner confirmed. Later on that day, Geithner was endorsed 18-5 by the Senate Finance Committee. A full Senate vote on the nomination may be held on Monday.
The American people can’t be blamed for worrying that if a tax cheat inspires confidence on Wall Street and can get an overwhelmingly positive vote in a Senate committee, the nation may be headed for financial ruin.
But Geithner not only got caught cheating on his taxes, he is now being accused of lying about his cheating during his confirmation hearing when he attempted to blame the problem on his TurboTax computer software program. But don’t expect this to be a major issue for business cable network CNBC.
In a major conflict of interest, General Electric’s media properties, which include CNBC, NBC News and MSNBC, are indirectly benefitting from the Wall Street bailout through a federal loan guarantee of $139 billion extended to GE Capital, the lending
arm of GE.
What’s more, GE chairman Jeffrey Immelt is a member of the board of the New York Federal Reserve, headed by one Timothy Geithner. In fact, Immelt may be involved in finding a successor to Geithner as president of the New York Federal Reserve Bank.
When GE Capital got its federal loan guarantee, the story was covered on CNBC by reporter Steve Liesman. A transcript includes the obligatory notation that “GE is the parent company of CNBC” but the video of Liesman breaking the story didn’t mention that.
The mantra, “GE is the parent company of CNBC,” is supposed to protect GE’s media property from any charges of conflict of interest in its coverage of the financial meltdown.
One of CNBC’s most famous and outspoken talking heads, Jim Cramer, did an amazing turnaround, first opposing Geithner and then supporting him. “I’ve given up fighting this,” he blurted out. “Obama loves him.” Cramer said that “the guy got a free pass” and “everybody on Wall Street — all my buddies who lost billions for you, for the American people, told me, ‘Jim, he’s the greatest.’”
“Well, now, everybody has discovered the truth,” he added, alluding to the tax cheating. Cramer said that if he had committed similar offenses, he would be going to jail.
On Capitol Hill, some senators were listening to their constituents, thousands of whom were phoning in protest over the Geithner pick, rather than to CNBC.
“I cannot vote to confirm the nomination based on the record and the need to foster greater accountability in both big government and our financial institutions,” declared Sen. Charles Grassley, the top Republican on the committee, in making a point that should have been obvious to other members. He quoted a constituent as saying, “If the man cannot handle his own finances, how is he going to handle the country’s?” Continue reading . . .
