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Geithner Pushing for Strauss-Kahn to Quit IMF

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Dominique Strauss-Kahn (left), head of the International Monetary Fund (IMF) who was arrested on charges of sexual assault and taken from an Air France flight moments before departure, was being pressured Wednesday to step down.Timothy Geithner, secretary of the Treasury, called for a successor to be named because, while "I can't comment on the case, . . . he is obviously not in a position to run the IMF."

Strauss-Kahn is being held at Rikers Island in New York without bail, considered a flight risk. He is expected to remain there until at least Friday at his next court hearing, when his attorneys are expected once again to request bail. The trial, according to Reuters, could be as long as six months away.

Strauss-Kahn denies the charges, but until the situation is resolved will be out of action at the IMF. His second in command, John Lipsky, has taken over negotiations in debt crisis dealings and is acting in his stead. No official successor has been named, and Lipsky plans to step down at the end of August. David Lipton, President Barack Obama's international economic adviser and a former deputy treasury secretary, is being considered by the White House as a proposed successor to Lipsky.

Support for Strauss-Kahn in Europe is falling, although early reports included the call to wait and see how the charges were resolved. But on Tuesday, Austrian Finance Minister Maria Fekter was quoted saying, "Given the situation, that bail has been denied, he has to consider that he would otherwise do damage to the institution."

Already there is jockeying to have the top post go to someone other than a European. Since the IMF was created in 1945, every managing director has been European; four have been French. While Christine Lagarde, France’s finance minister, is rumored to be interested in the position, a public inquiry recommended by a Paris prosecutor into a case involving compensation may have cast a shadow on her prospects.

China weighed in early, calling for "fairness, transparency and merit" to be considerations in choosing a new chief. And in an effort to slant the post to offer emerging economies a greater say, South African Finance Minister Pravin Gordhan and an unidentified senior Brazilian government official suggested that the post go to someone from a developing country. Former Japanese currency czar Hiroshi Watanabe challenged Europe's right to the top job on Wednesday.

Berlin, however, said it was too early to replace Strauss-Kahn. Christoph Steegmans, a government spokesman, responded to Geithner’s comments in a report, saying, "We believe the IMF will find a way to assure its capabilities and we also believe that it is good the IMF conducts this debate internally first. To be very honest, the question of a successor at the IMF is not yet being raised today. We must therefore await developments and the investigation in New York."