The biggest danger to the United States and its economy is the breakdown of the political system in Washington, former Treasury Secretary Timothy Geithner said in Tallahassee Wednesday.
“Nothing is more important than improving the quality of the decisions you get in Washington,” Geithner told members of the Economic Club of Florida during a luncheon.
“There’s no threat to us outside the United States that is greater … than that basic challenge. We have no capacity to think about those other threats from outside without taking care first of that fundamental part of the American system,” he said.
“It’s a nice rule in life — start at home. Start to figure out how you can rebuild that basic trust and confidence in this place and it’s capacity to do things. If we do that, then we’ll preserve the confidence and the growth in this place, and we’ll have enough strength that we can deal with any potential threat out there.”
The country’s leaders managed to do that during the 2008 financial crisis, which Geithner helped manage as head of the Federal Reserve Bank of New York.
“We had a political system that ultimately was able to come together — which is kind of rare today, too — across the parties, across administrations, and kept at it to figure out what would work,” Geithner said.
“It was messy, and terrible, and traumatic, and painful, and we’re still with the scars of it. But it made me more confident in our country, because we had pretty good institutions and they didn’t let politics get in the way.”
Geithner served as Treasury secretary between 2009 and 2013, and now is president of the Warburg Pincus hedge fund.
He believes in strong “fire stations” — institutions and regulations to respond to crises that can result when people’s optimism leads them into dangerous risks and financial