GOP candidate wants Geithner to be replaced

A former House Republican running for the Senate in Connecticut is calling for Treasury Secretary Timothy Geithner to be replaced over his handling of AIG's bailout.

GOP candidate Rob Simmons reacted to a report by Neil Barofsky, the inspector general of the $700 billion bailout program, known as the Troubled Asset Relief Program (TARP).

Barofsky's report criticized the Federal Reserve Bank of New York, which Geithner led during the bailout, for a series of missteps that Barofsky said ended up requiring the government to provide additional support to AIG.

"The report issued yesterday by the inspector general for the TARP program is a deeply troubling account of Secretary Geithner's failed management of the AIG bailout in which he cost taxpayers $13 billion in unnecessary new debt," said Simmons, who appears to be the only candidate or office-holder to call for Geithner's replacement in response to the report.

The federal government committed more than $180 billion to AIG, which was crippled by poor investments and trades in credit default swaps, a financial derivative.

Simmons also attacked his opponent, Senate Banking Committee Chairman Chris Dodd (D-Conn.), in the statement calling on Geithner to be replaced.

"The cozy relationships between the bailed-out financial companies and powerful politicians like Tim Geithner and Chris Dodd are exactly why Americans have lost trust in Washington, D.C., and why we need new leadership with the skills and integrity to clean up their mess and get our economy back on track."

Simmons has worked to make Dodd's ties to the financial industry an issue in his race. Recent polls have Simmons in front of Dodd by more than 10 points. AIG is seen as a point of vulnerability for Dodd, who was criticized earlier this year for supporting language that allowed AIG employees to keep bonuses that were promised as part of contracts signed before Feb. 11, 2009. Dodd has said he did not know about the AIG bonuses at the time, and that Obama administration officials had asked for the language, which was included in the $787 billion stimulus bill.

Dodd has worked hard to show his independence from Wall Street. He introduced sweeping financial regulatory reform legislation last week that has provoked opposition from most of the financial sector. It also appears to put him at odds with the Federal Reserve and Geithner, who had proposed less drastic changes to the regulatory framework in response to last year's financial crisis.

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