Standing at the airport, Geithner certainly felt deflated, but for now it was mostly because his driver hadn’t appeared. “You want to just take a taxi?” Mitchell asked.
Geithner, arguably the second most powerful central banker in the nation after Bernanke, stepped into the twenty-person-deep taxi line.
Patting his pockets, he looked sheepishly at Mitchell. “Do you have cash on you?”
If Tim Geithner’s life had taken just a slightly different turn only months earlier, he might well have been CEO of Citigroup, rather than its regulator.
On November 6, 2007, as the credit crisis was first beginning to hit, Sanford “Sandy” Weill, the architect of the Citigroup empire and one of its biggest individual shareholders, scheduled a 3:30 p.m. call with Geithner. Two days earlier, after announcing a record loss, Citi’s CEO, Charles O. Prince III, had been forced to resign. Weill, an old-school glad-hander who had famously recognized and cultivated the raw talent of a young Jamie Dimon, wanted to talk to Geithner about bringing him on board: “What would you think of running Citi?” Weill asked.
Geithner, four years into his tenure at the New York Federal Reserve, was intrigued but immediately sensitive to the appearance of a conflict of interest. “I’m not the right choice,” he said almost reflexively.
For the following week, however, the prospect was practically all he could think about—the job, the money, the responsibilities. He talked it over with his wife, Carole, and pondered the offer as he walked their dog, Adobe, around Larchmont, a wealthy suburb about an hour from New York City. They already lived a comfortable life—he was making $398,200 a year, an enormous sum for a regulator—but compared with their neighbors along Maple Hill Drive, they were decidedly middle-of-the-pack. His tastes weren’t that expensive, save for his monthly $80 haircut at Gjoko Spa & Salon, but with college coming up for his daughter, Elise, a junior in high school, and his son, Benjamin, an eighth-grader behind her, he could certainly use the money.
He finally placed a call to his old pal Robert Rubin, the former Treasury secretary and Citigroup’s lead director, to make sure he hadn’t made a mistake. Rubin, a longtime Geithner mentor, politely told him that he was backing Vikram Pandit for the position and encouraged him to stay in his current job. But the fact that he had been considered for a post of this magnitude was an important measure of Geithner’s newly earned prominence in the financial-world firmament and a reflection of the trust he had earned within it.
For much of his time at the Fed, he had detected a certain lack of respect from Wall Street. Part of the problem was that he was not out of the central banker mold with which financial types traditionally felt comfortable. In the ninety-five-year history of the Federal Reserve, eight men had served as president of the Federal Reserve Bank of New York—and every one of them had worked on Wall Street as either a banker, a lawyer, or an economist. Geithner, in contrast, had been a career Treasury technocrat, a protégé of former secretaries Lawrence Summers and Robert Rubin. His authority was also somewhat compromised by the fact that, at forty-six, he still looked like a teenager and was known to enjoy an occasional day of snowboarding—and that he was given to punctuating his sentences with “fuck.”
Some Washington officials, journalists, and even a few bankers were charmed by Geithner, whose wiry intensity and dry, self-deprecating wit helped create the image of him as something of a policy-making savant: Although he often appeared distracted and inattentive during meetings, he would, after everyone had said his piece, give a penetrating analysis of the entire discussion, in coherent, flowing paragraphs.
Others, however, regarded these performances as what they saw as a form of controlling shtick. Every month the New York Fed would host a lunch for Wall Street chieftains, the very people his office oversaw, and every month Geithner would slouch in his seat, shuffling his feet, sipping a Diet Coke, and saying precisely nothing. He was as Delphic as Greenspan, one of his heroes, but he didn’t have the gravitas to pull it off, certainly not to an audience of major Wall Street players.
“He’s twelve years old!”
Such was the reaction of a nonplussed Peter G. Peterson, the former Lehman Brothers chief executive and co-founder of the private-equity firm Blackstone Group, upon first meeting Geithner in January 2003. Peterson had been leading the search for a replacement for William McDonough, who was retiring after a decade at the helm of the New York Fed. McDonough, a prepossessing former banker with First National Bank of Chicago, had become best known for summoning the chief executives of fourteen investment and commercial banks in September 1998 to arrange a $3.65 billion private-sector bailout of the imploding hedge fund Long-Term Capital Management.
Peterson had been having trouble with the search; none of his top choices was interested. Making his way down the candidates list, he came upon the unfamiliar name of Timothy Geithner and arranged to see him. At the interview, however, he was put off by Geithner’s soft-spokenness, which can border on mumbling, as well as by his slight, youthful appearance.
Larry Summers, who had recommended Geithner, tried to assuage Peterson’s concerns. He told him that Geithner was much tougher than he appeared and “was the only person who ever worked with me who’d walk into my office and say to me, ‘Larry, on this one, you’re full of shit.’”
That directness was the product of a childhood spent constantly adapting to new people and new circumstances. Geithner had had an army brat childhood, moving from country to country as his father, Peter Geithner, a specialist in international development, took on a series of wide-ranging assignments, first for the United States Agency for International Development and then for the Ford Foundation. By the time Tim was in high school, he had lived in Rhodesia (now Zimbabwe), India, and Thailand. The Geithner family was steeped in public service. His mother’s father, Charles Moore, was a speechwriter and adviser to President Eisenhower, while his uncle, Jonathan Moore, worked in the State Department.
Following in the steps of his father, grandfather, and uncle, Tim Geithner went to Dartmouth College, where he majored in government and Asian studies. In the early 1980s, the Dartmouth campus was a major battleground of the culture wars, which were inflamed by the emergence of a right-wing campus newspaper, The Dartmouth Review. The paper, which produced prominent conservative writers such as Dinesh D’Souza and Laura Ingraham, published a number of incendiary stories, including one that featured a list of the members of the college’s Gay Students Association, and another a column against affirmative action written in what was purported to be “ black English.” Taking the bait, liberal Dartmouth students waged protests against the paper. Geithner played conciliator, persuading the protesters to channel their outrage by starting a rival publication.
After college, Geithner attended the Johns Hopkins School of Advanced International Studies, where he graduated with a master’s degree in 1985. That same year he married his Dartmouth sweetheart, Carole Sonnenfeld. His father was best man at the wedding at his parents’ summer home in Cape Cod.
With the help of a recommendation from the dean at Johns Hopkins, Geithner landed a job at Henry K issinger’s consulting firm, researching a book for K issinger and making a very favorable impression on the former secretary of State. Geithner learned quickly how to operate effectively within the realm of powerful men while not becoming a mere sycophant; he intuitively understood how to reflect back to them an acknowledgment of their own importance. With Kissinger’s support, he then joined the Treasury Department and became an assistant financial attaché at the U.S. Embassy in Tokyo, where he ruled the compound’s tennis courts with his fierce competitiveness. The courts were also a place he could hold informal discussions with Tokyo correspondents from major publications, diplomats, and his Japanese counterparts.