Senate Panel Approves Geithner for Treasury Secretary

WASHINGTON -- The Senate Finance Committee decided Thursday that Timothy Geithner's tax problems should not imperil his nomination for treasury secretary, voting 18-5 to recommend confirmation in the full Senate.

President Obama is hoping for quick approval so that his point man for the administration's economic rescue effort can begin work.

The committee vote came a day after Geithner had appeared before the panel to apologize for what he called "careless mistakes" in failing to pay $34,000 in taxes earlier in the decade when he worked at the International Monetary Fund.

Geithner was supported by all Democrats on the panel, as well as five Republicans.

One committee member, Sen. Kent Conrad, D-N.D., a former tax commissioner, said in normal times, Geithner's failure to pay his taxes would have led Conrad to oppose the nomination.

"But these are not normal times," Conrad said. He said the economy's not "out of the woods" and touted Geithner's extensive experience at a time when the country needs a treasury secretary imminently.

Obama wants Geithner in place as his administration gets to work distributing the second half of the $700 billion financial bailout package and lobbying for passage of an $825 billion economic stimulus plan.

The nomination was expected to win approval by the full Senate. Geithner has been the head of the Federal Reserve Bank of New York for the past six years and was a key participant in decisions made by the Bush administration to deal with the worst financial crisis to hit the country since the Great Depression.

Geithner paid the back taxes plus interest for the years 2003 and 2004 after being audited by the Internal Revenue Service. But he did not pay taxes he owed for 2001 and 2002, even though he had made the same mistakes for those years, until shortly before he was nominated by Obama last November to be treasury secretary.

The top Republican on the committee, Chuck Grassley of Iowa, voted against the nomination.

Those voting no said that they did not believe Geithner had been candid in his answers on why he failed to pay Social Security and Medicare taxes. They said they viewed this as a serious error for an official who would head the agency that oversees the IRS.

"I am disappointed that we are even voting on this," said Sen. Michael Enzi, R-Wyo. "In previous years, nominees who made less serious errors in their taxes than this nominee have been forced to withdraw."

Obama's choice for secretary of state, Hillary Clinton, was confirmed by the full Senate Wednesday after a Republican senator caused a one-day delay over questions about donations to former President Bill Clinton's foundation. Six other Cabinet secretaries were confirmed on Inauguration Day.

FOX News' Trish Turner and The Associated Press contributed to this report.