Geithner On His Way Out?

Timothy Geithner should be out at Treasury by the end of next week. How do I know? Look at the following statements made today by President Obama about his Treasury Secretary:

"I have complete confidence in Tim Geithner and my entire economic team."

"Nobody's working harder than this guy. You know, he is making all the right moves in terms of playing a bad hand."

Those are precisely the kind of statements made just before the, "for personal reasons, the secretary has decided to step down from his position...."

Geithner has already given us one of our first, "what did he know and when did he know it?" moments. According to AIG Chief Executive Edward Liddy, Geithner knew about the bonus payouts two weeks ago, but a Treasury spokesman has disputed this, claiming Geithner only discovered the bonuses on March 10.

Absolutely no one has been wowed by his performance so far -- he has appeared torpid, unfocused and disorganized, not exactly what is needed in a time of economic uncertainty. He has been unable to confidently articulate a plan for the economy. And now this mess, with the government admitting at best that it had no idea where some of the bailout money was going. At worse, they knew and did nothing.

Which takes us to Democratic Senator Christopher Dodd, who one day after denying that he played any role in the loopholes that allowed AIG to payout these huge bonuses, today admitted that he lied. According to a report from CNN, Dodd acknowledged that he in fact was responsible adding language to the federal stimulus bill which ensured that the pre-existing contracts for bonuses at companies receiving federal bailout money were honored.

It is hard to imagine this senior Democrat, Chairman of the Senate Banking Committee, was acting without the knowledge and consent of the administration. And, indeed, it turns out he wasn't.

Dodd told CNN that the Obama administration pushed for the additional language because it was worried that without allowing for these bonus payments, the bill might be threatened. Dodd would not name who in the Treasury Department urged him to add the bonus payments loophole, but said it was a number of different staffers.

This is not something Geithner can explain his way out of. He really has no other choice but to just step down. And maybe Dodd should join him on the way out.