The Senate has done virtually nothing, for example, to address the glacial pace of confirmations that often leads presidents to expand the White House staff as well as the number of appointees who serve without Senate approval. Although he has submitted the names of nominees to the Senate relatively quickly, President Obama will be lucky if the last of his nearly 500 full-time cabinet and subcabinet officers are confirmed by March 2010.

Obviously the president has made some mistakes with his Cabinet picks. The endless parade of nominees with tax problems — Tim Geithner, Tom Daschle, Nancy Killefer, Hilda Solis — has not exactly inspired confidence in the vetting process or the integrity of the people being tapped for public service.

But, tax troubles and all, Obama still has 55 nominees pending before the Senate; legislators have confirmed just 43 people in the more than two months of Obama’s presidency.

Congress has a lot on its plate. But you would think confirming Obama’s appointees would be a higher priority.

According to ABC News, his third pick for deputy treasury secretary — H. Rodgin Cohen, a partner in a New York law firm — has withdrawn his name from consideration. No word on why, just that a “problem” came up late in the vetting process.

Geithner (who is arguably the most important Cabinet secretary right now) is supposed to have 17 confirmed deputies.

He currently has zero.

A few of the highlights that impact federal agencies:

• The Treasury Department will “stress-test” banks. Presumably this is to ensure that banks receiving money through TARP 2.0 are actually solvent. There’s serious concern that many of the largest banks in America are insolvent.
• Treasury and the Federal Reserve will create a “bad bank” to buy toxic securities with a mix of public and private capital.
• The government will guarantee a larger percentage of Small Business Administration loans. SBA lending has plummeted in recent months because of tight credit markets and the deepening recession.

Geithner said the Obama team would unveil its plan for stabilizing the housing markets “within the next few weeks.” Presumably that will involve Treasury, the Federal Housing Finance Agency, the Housing and Urban Development Department, and others.

In a letter to Treasury Secretary Timothy Geithner Thursday, Towns, D-N.Y., asked him to listen to the recommendations of Neil Barofsky, the special inspector general for the Troubled Asset Relief Program.

Barofsky testified before the committee Wednesday, recommending that all TARP agreements include requirements that receipients of federal dollars must provide Barofsky and other oversight authorities information on how the money has been spent. He also urged creation of internal controls and clarifying compliance with TARP rules.

He asked Geithner to implement Barofsky’s recommendations before distributing any more TARP funding.

Towns writes that better TARP oversight could be a model for future program oversight operations:

“Moving forward, I would like to see the same level of oversight performed by independent, presidentially–appointed inspectors general at other financial regulatory agencies which are spending taxpayer money in an effort to boost the economy.”

The final vote was surprisingly close, 60-34; several Democrats were among the “nay” votes, including Sens. Robert Byrd, D-W.Va., and Tom Harkin, D-Iowa.

Geithner, by the way, is likely to be confirmed despite the tax issue. Senate Finance committee chairman Sen. Max Baucus, D-Montana, plans to hold a vote tomorrow, despite objections from several Republican committee members. The nomination would then go before the full Senate.

It may have to do with a tax problem:

Timothy F. Geithner, President-elect Barack Obama’s choice for Treasury secretary, failed to pay more than $34,000 in federal taxes over several years early this decade, and also faces questions about the employment papers of a former household employee, suddenly complicating what had seemed to be an easy confirmation process in the Senate.

Hard to know what to make of this. Geithner repaid the back taxes, with interest, after the Obama team discovered the problem. And the immigration bit seems like a non-story: The housekeeper was authorized to work in the United States, but her authorization expired during the last three months of her employment with Geithner.

On the other hand: A Treasury secretary who didn’t pay a big chunk of his tax bill? Almost as bad as a Ways & Means committee chairman who doesn’t understand the tax code.

What do you think? Is the tax issue a distraction from much bigger economic problems? Or should it affect Geithner’s nomination?

NBC News

The choice of Geithner may have boosted confidence on Wall Street. In the last hour of trading, stocks shot up and the Dow Jones Industrial Average was up nearly 500 points at its close.

The Washington Post has this to say about Geithner:

Geithner, who is 47, is most closely aligned with Clinton-era economics, having previously worked at Treasury under Clinton secretaries Bob Rubin and Larry Summers.

But he is thought of as an economic centrist. [...] Prior to Treasury, Geithner worked at the IMF and with Henry Kissinger at his consulting firm.

And here’s an excellent Post piece describing how Geithner’s partnership with Paulson and Bernanke developed, and how the three men make on-the-fly decisions that affect the entire world’s economy.

As the financial crisis began in August 2007, the phone calls became more frequent — often quick, and unplanned. The three developed a Socratic style; one man would present an idea, and the others would challenge it, consider its flaws and ultimately find ways to tweak it.

Within the fraternity, the man who takes the lead depends on which agency is primarily responsible for the matter at hand.

When Geithner engineered the rescue of failing investment bank Bear Stearns in the middle of a cold March night, he had Paulson and Bernanke on the phone to get their input and blessing.

Paulson took the lead on the government takeover of Fannie Mae and Freddie Mac, but Bernanke advised him closely, and Geithner played a supporting role in calculating the impact on the financial markets.

Obama is expected to formally announce Geithner’s nomination Monday. NBC is reporting that Obama also will probably name New Mexico Governor Bill Richardson as Commerce secretary. And the New York Times reported today that Sen. Hillary Clinton, D-N.Y., will accept Obama’s offer to be secretary of state.