Nor did the clueless Christopher Cox, the SEC head, who should have been referring case after case to the Justice Department for repeated Sarbanes-Oxley prosecutions. But the administration either didn't believe in the broad powers given by Sarbanes-Oxley or the Justice Department felt so gun-shy after the failure to convict the two Bear Stearns executives who apparently lied or misjudged their portfolios. The failure to win that case haunts all the other attempts for justice.
Geithner doesn't dwell on this, nor does he finger Attorney General Holder for getting involved and getting his hands dirty going after the ne'er-do-well executives. That's not Geithner's fault. Justice skates, sinfully, in the book, and only brought the cases we now see, cases where no exec is ever brought up on charges and the shareholders repeatedly pay for the crimes of these exec.
That's the biggest outrage of the book, but neither President Obama nor Holder come under any scrutiny at all here. But was it Geithner's job either as head of New York Fed or later as Treasury Secretary? Definitively not. The critics are obtuse about any of this, and no one takes Obama or Holder to task. That's just sinful.
The most important part of the book from the point of view of public policy is Geithner and Ben Bernanke's resolve to fix the system through aggressive capital raises. I think Geithner doesn't give Bernanke enough credit for stopping the runs on the banks with his fabled interview on 60 Minutes at the exact bottom of the stock market when he said there would be no more failures. In fact, Bernanke really doesn't get his due in the book. I don't know why that is, but it seems gratuitous by Geithner. Instead, he discusses how wrong Larry Summers would have been to go ahead with his plan to nationalize all the banks as if we were Sweden, a country about the size of Georgia. He also obliquely chides Volcker and the president for focusing on the internal hedge funds within the big surviving investment banks, even as the prop desks had nothing to do with the systemic woes whatsoever. Just another wrongheaded view by Washington that detracts from any logical fix.
Finally, Geithner makes it clear that the whole system would have failed and the U.S. not gotten back on its feet if he hadn't set up the actually-extremely-rigorous stress tests that created a surfeit of capital and preserved the remaining institutions, all of which he said needed it, particularly the utterly mindless Bank of America (BAC) and the very indignant Wells Fargo, another shot at Kovacevich, who has now spent years coming on television saying his bank didn't need the money. I find his protestations funny. Which brings me to the last and most faulted portion of the book, save the coddling charge, and that's Geithner's view that not only have his actions and the actions of others pointedly mentioned within Treasury saved the system, but they have brought prosperity to the country.
While Geithner makes it clear that the prosperity is relative vs. Europe, this one rings hollow with all Republicans who think the economy is weak and all Democrats who want more help putting people to work. He's hated in an equal-opportunity way for his own judgment.
I do not regard the book as political, but maybe that's because it isn't, save one paragraph where he asks the Tea Party where it was during the Bush administrations heinous deficit creation and the unfunded wars that amount to presidential freebooting and fecklessness. When I read the paragraph out loud at Barnes & Noble it got a real belly laugh but, it does raise a pertinent question. Where, indeed, were they?
Am I a defender of Geithner? No, I am a defender of his view of events, with certain differences having to do with my own experiences covering the chaos. Is he an honest broker? I think so. Will that matter? Nope. The polemicists have seized the mike and buried the man.
It's a shame. He deserves better.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long JPM.
Editor's Note: This article was originally published at 8:30 p.m. EST on Real Money on May 26.