Shifting Priorities

The anticipated nomination of Lew to head the Treasury highlights a shift in the economic priorities of the Obama administration, away from battling the crisis and overhauling financial regulation to working with Congress to tackle a budget deficit that’s topped $1 trillion for four straight years.

Lew’s skill set may be better suited to the times. While it was important for Geithner to have experience dealing with economic emergencies when he took over Treasury in 2009, now “the number-one challenge is different,” said Martin Baily, who worked with both Lew and Geithner under former President Bill Clinton.

“Jack will bring to the budget challenge a lot of experience,” said Baily, now a senior fellow at the Brookings Institution in Washington, who was chairman of Clinton’s Council of Economic Advisers.

Budget Director

Before becoming chief of staff, Lew served as Obama’s director of the Office of Management and Budget, a position he also held in the Clinton administration. Lew’s anticipated nomination is subject to Senate confirmation.

Geithner’s experience in fighting financial fires, both as a Treasury official in the Clinton administration, when he was involved in dealing with Asia’s economic woes, and later as president of the New York Fed, allowed him to hit the ground running when he became secretary in 2009, Truman said.

He also benefited from being well known internationally, including having a close relationship with European Central Bank President Mario Draghi, added Truman, a senior fellow at the Washington-based Peterson Institute for International Economics.

Geithner was unique as a Treasury secretary “because he was both a staffer at Treasury and an official in the Federal Reserve System before becoming secretary so he saw it from both levels, as career staff and leadership of the Fed,” said Tony Fratto, who worked at Treasury during the George W. Bush administration.

Geithner and Bernanke looked out for each other as they struggled to contain the worst financial crisis since the Great Depression and speed up the subsequent recovery of the economy.