Geithner: Economic recovery will be a long haul

U.S. Treasury Secretary Timothy Geithner spoke in Palo Alto and talked about the road to recovery.

October 18, 2010 7:36:31 PM PDT
U.S. Treasury Secretary Timothy Geithner spoke in Palo Alto on Monday, saying the road to economic recovery will be a long haul.

The most recent unemployment figures from the U.S. Labor Department confirm that. Jobless claims rose for the first time in three weeks, indicating companies are still reluctant to hire. New claims climbed by 13,000 the week before last to more than 460,000 people.

Geithner tackled a wide range of questions in his one hour Q and A at the Commonwealth Club. They included his interest in surfing to high speed rail to the U.S. currency, but of course the focus was on the health of our economy.

"I believe most of the adjustment we face as a country in real estate, in the financial sector, is largely behind us now," said Geithner.

He said the economy is definitely healing even though the scars of the recession still linger.

"You can see it in housing, if you were in the construction industry, if you're a small bank in some parts of the country, you're a small business trying to get credit, it's still very hard," said Geithner.

Geithner says there are encouraging signs among them. The economy has been growing for more than a year, especially in the private sector.

"Private investment, which is in some ways is one of the most fundamental measures of strength we have for an economy coming out of crisis, has been really quite strong, grew greater than 20 percent at an annual rate in the first half of the year," said Geithner.

The treasury secretary said President Obama's economic program outlined in September will give more incentives for business to create jobs.

"One is to give businesses for one year the chance to write off against their taxes investments they make in new capital equipment," said Geithner. "Extend the tax cuts that are now in place that goes to 98 percent of working Americans into 98 percent of small businesses."

But Geithner seemed to have more difficulty answering the question, "What do you say, what hope do you give to a 35-year-old unemployed automobile worker in Detroit?"

"I think the only answer you can say is that it is important that we all recognize the government has more work to do to solve these problems, to repair this damage, to get those people back to work as quickly as possible," said Geithner.

That answer didn't satisfy Stanford student Lindsay Russell.

"He really didn't have a great answer for what to say to an unemployed auto worker in Detroit," said Russell.

Others in the audience like small businessman Hunter Whitney wanted Geithner to address other issues.

"There's been a lot of discussion about health care and the impact on the economy and I really wanted to get his sense of what that would actually mean," said Whitney.

On a local note, the secretary says he supports projects like the proposed high speed rail because it creates jobs. And in case you're wondering, Geithner said, yes, he likes surfing, but he's not proficient at it and he wants to quell the rumor that he's surfed at Mavericks in Half Moon Bay.


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