Last week, I noted my preference for Fed Chief was Anyone But Larry Summers.

So you can imagine my disappointment when Ezra Klein posted this today:  Right now, Larry Summers is the front-runner for Fed chair.

Oy.

This nation faces too very large political problems related to economics:

1. The President of the United States is an Economic Naif. Perhaps less so than he was on January 20th 2009, but overall, I cannot help but reach the inescapable conclusion that he lacks a sophisticated understanding of the economy.

2. That naivete has led him to be bamboozled — repeatedly — by Robert Rubin and his acolytes. Both Tim Geithner and Larry Summers are “Rubinites.”

 

Discuss.

 

 

images

Category: Really, really bad calls, UnGuru

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

69 Responses to “Discuss: Larry Summers, Front Runner”

  1. That was the least flattering photo I could find

    • S Brennan says:

      …most excellent.

    • BennyProfane says:

      You mean there’s a good picture of that guy out there?

    • gKevinb says:

      If B.O. is a “naif,” then Larry is a naif molester. But I think you’re wrong about naifdom. Don’t forget the far less naifish views expressed during the 2008 campaign. And even simple-minded folks like me know the story about the fox guarding the chicken coop. No . . . naifery isn’t it.

  2. Miguel Palacios says:

    I can’t believe Robert Rubin or Larry Summers have a shred of credibility left…These people’s ideas were catalysts for the creation of the TBTF banks and the deregulation that led to the GFC.. Idea of Larry Summers at the Fed makes me shudder.

    • LAgraves says:

      Money in politics is almost always the reason why we have problems with our country, in my opinion…UGH.

    • rd says:

      The man is a walking disaster for everybody around him but somehow he manages to get away smelling like lavender each time.

      I cannot believe that this man is even on the long list, never mind a fornt runner. Pretty much all of his recommendations have blown up over the past decade. He also demonstrated that he is a lousy administrator without much integrity or sense of decency in his stint at university. His primary strength seems to be an endless ability to schmooze and brown-nose.

      Hmmm… wait a minute…..these all sound like the ideal characteristics for s successful career in Washington. Done…he’s hired.

  3. louiswi says:

    Say it isn’t so, Barry.

    Summers has a debris field reflecting his incompetency trailing behind him.

    Janet Yellen is the only sensible choice, IMHO.

  4. RC says:

    Obama disappoints again!!!!
    The damage that Summers and Co. made isnt even all undone …..

    • BennyProfane says:

      Obama, at this point, is preparing for his and his family’s future. He has watched the Clintons become very very wealthy as an ex presidential family unit, and probably wants the same for his brood. Chelsea (Chelsea!) is making more money than 99.5% of Americans right now. She’s on a corporate board, furcryingoutloud. So, I’m pretty sure Obama doesn’t want to alienate the bankers, who, as we all know, won the last great battle.

  5. peterkrause says:

    The discounting mechanisms will save us and there will be trading opportunities along the way. If Hoover couldn’t destroy the country and Bush couldn’t, what chance does Summers have?

    From “Things White People Like”: Canada.

  6. Singmaster says:

    Somebody, please call the White House and say “Nooooooooo. Not Summers! Don’t even think it!”
    Send Barry’s post to the White House.
    Start a fb campaign, a linked in campaign, a twitter campaign.
    I would lose all faith if Summers was appointed. All faith.
    Janet Yellen? Yes.
    Summers? NO. Anybody but Summers.
    How can we stop this?

    • webmartians says:

      What percentage of the people blogging here will write the White House (http://www.whitehouse.gov/contact)? What percentage have EVER done so, much less contacted representatives?

      Excuses:
      - They’re all crooks.
      - They don’t listen to us.
      …and the “best” one:
      - They won’t do anything. (Well … they sure won’t if you don’t say something!)

      “Never believe that a few caring people can’t change the world. For, indeed, that’s all who ever have.” – Margaret Mead (and, unfortunately, among others, Adolph Hitler)

      • rd says:

        I contacted Obama and my senators (one of whom is on the Finance Committee) begging them not appoint or approve Geithner for Treasury. However, I did not attach a campaign contribution check to it, so it went nowhere.

  7. barbacoa666 says:

    Maybe Summers as front runner is the reason gold has rallied a bit. It can’t hurt to own gold if “Mr. Financial Cataclysm” is Fed Chief.

  8. beaufou says:

    I saw this bit of news elsewhere and came here to verify. I thought someone at the Onion had fooled the press. Simply stunning, Stiglitz probably has smoke coming out of his ears.

  9. bear_in_mind says:

    C’mon, we can do better with Summers photos! Try these:

    1) http://nicedeb.files.wordpress.com/2009/07/larry-summers-is-sleepy-three-thumb-480×350.jpg
    2) http://a.abcnews.go.com/images/Business/abc_bus_summers_100922_wg.jpg
    3) http://1.bp.blogspot.com/_azimCSzqNnc/SdlV8GkpsoI/AAAAAAAAA44/ANk3P5g86YQ/s400/larry+summers.jpg
    4) http://www.mockpaperscissors.com/blog/wp-content/uploads/2009/07/larry-summers-surreal-253×300.jpg
    5) http://go.bloomberg.com/tech-deals/files/2012/12/blog_larrysummers.jpg
    6) http://www.ivygateblog.com/wp-content/uploads/2011/07/larry-summers-02-grimacing.jpg
    7) http://beta.images.theglobeandmail.com/e4b/incoming/article904797.ece/ALTERNATES/w620/summers.jpg
    8) http://ts3.mm.bing.net/th?id=H.4625444637312766&pid=1.7
    9) http://images.politico.com/global/click/100922_larry_summers_sideways_face_ap_392_small.jpg
    10) http://dealbreaker.com/uploads/2012/10/larrysummers.jpg

    Also, when you reference naivete, recall that Bill Clinton selected BOTH Robert Rubin and Larry Summers as two of his Treasury Secretaries.

    I don’t know that Clinton is exactly Mr. Naive, but I think these appointments (along with Geithner, of course) merely reflect just how deeply viral Wall Street’s influence is on the U.S. government body politic. I don’t know how American citizens can do it, but I’d be more than happy to provide support and shekels to an organization that could cleanse these parasites from the arteries of power.

    • Robert M says:

      “I don’t know that Clinton is exactly Mr. Naive, but I think these appointments (along with Geithner, of course) merely reflect just how deeply viral Wall Street’s influence is on the U.S. government body politic. I don’t know how American citizens can do it, but I’d be more than happy to provide support and shekels to an organization that could cleanse these parasites from the arteries of power”

      SECOND! All in favor…..

  10. TerryC says:

    Don’t worry, he would have to be approved by the Senate. I’m sure the greatest deliberative body in the world would not let him get the job.

  11. b_thunder says:

    Ezra Klein says “This White House, more so than any other in modern memory, knows in its bones that the economy can fall apart at any second.” Perhaps in a few years we’ll be saying that the crash couldn’t have happened to a better Fed Chairman than Summers. That would be the most appropriate legacy to a self-aggrandizing fool.

    Other thoughts:
    1. Follow the money: Obama & Co’s greatest achievement is their ability to amass campaign contributions. Summers as Fed Chief is either a payoff or an advance favor for Wall St campaign money.
    2. If you repeat the lie long enough, you too may become a believer. So much has been said about Summer’s brilliance that Obama must be a believer…. not to mention that Summers himself must think he’s a genius and is freaking infallible when it comes to economics.
    3. GS and Bob Rubin’s influence never truly left the WH

    • beaufou says:

      As Napoleon once noted, don’t always suspect malice when incompetence might be at work.

      • rd says:

        I am always leery of conspiracy theories. Conspiracies require skill, cunning, tenacity, and secrecy. All of these are in short supply. Occam’s Razor says that if incompetence or inattention can yield the same end result, then it is much more likely to be the cause.

  12. nofoulsontheplayground says:

    I have my doubts he’ll get the appointment. He did not get the World Bank gig he wanted, so it seems unlikely he’ll get this.

    This administration talks about economic theory as if it were scientific fact, and they got their lessons from Summers and Romer.

    There is still some time before the appointment is made. Lots of things could change in the interim. Recall how GWB had to backtrack on possible Supreme Court appointees because of his weak poll numbers resulting from the Iraq war.

    The problem with Janet Yellen as a Fed Chair candidate is she has no real private sector experience. Paul Volker would agree the Fed chair should have experience running a bank, and the person should also be a proponent of Glass Steagall. However, that’s not going to happen anytime soon.

    • constantnormal says:

      Sheila Bair has the credentials.

      Running the FDIC is probably better experience than running a bank, as one gets to see and deal with all the mistakes banks make, on a weekly basis.

  13. Obama’s economic ignorance is going to doom his legacy I fear.

    Its been clear from when he was inaugurated and appointed the group of fools (Summers, Geithner, etc,) who’s ‘vision’ of macroeconomics and American empire has been tragic for us and the globe that something was seriously wrong with his ‘change we can believe in’…

    Sadly he could be seen as a patsy for a failing paradigm.

    • cowboyinthejungle says:

      Completely agree, and it extends beyond economics. He speaks with the rhetoric of optimism, equality, transparency, and the necessity to balance private freedom with a social contract. His actions belie this message, as he has codified the failing paradigm. My fear is that when it fails, it is the rhetoric rather than the actions that will be blamed. i.e. the lunatics that have been spouting all the “Muslim, Kenyan, Marxist” hate will offer such a failure as proof of their ideology, and the corporate media will go along.

      Regarding the appointment of Summers, I’d expect nothing less than seeing this dude fail up to the Fed, in a world that has been turned on its head in every way.

  14. bear_in_mind says:

    One last thought: As a total outside observer, I think Yellen is clearly the hands-down best candidate among the slate of names I’ve seen floated.

    The thing that strikes me about so many images of Summers is that it looks like he often feels disdain for his fellow man / woman. He might have the IQ of Steve Jobs, but sure seems to have none of the charisma or charm… and that’s saying something given how mercurial the late-Mr. Jobs was renowned to be.

  15. TraderJoe says:

    There is a petition on DailyKos – “Tell President Obama to not appoint Larry Summers as Federal Reserve chair” http://campaigns.dailykos.com/p/dia/action3/common/public/?action_KEY=502

  16. And I continue to insist that a simple political microtransaction (e.g. click a link via mobile or email and give for example 25 cents) is a very big deal with large numbers.

    Low threshold for click-through and high volume solicitations changes the landscape for lobbying.

    And I’m starting to wonder why its not done. DO the numbers, I don’t claim it fixes everything… but it changes the game and draws the citizen into the game.

    I’m no entrepreneur…. I’m an anthropologist (amateur) but the pooled-user-determined account (patented) DOES make it a financially feasible transaction. There’s no excuse for ignoring the capability. I’ve got David Brin and Douglas Rushkoff on board for the method and concept (speaking as some guy coming out of nowhere I can attest its takes a long time to break through the skepticism).

    Forget me… consider me a nut… but look at the capability… which I’m convinced will eventually be seen as a fundamental tool and necessary check of both corporate and government dominance.

    (Which I hope is NOT the reason this hasn’t been getting the attention it deserves.)

  17. ch says:

    Barry-

    You seem to assume that Obama is in charge of things, particularly vis a vis this decision and others as it relates to the economy and financial system.

    For a data-driven guy, you have to ignore a lot of objective data that supports a contrary assertion in order to believe that Obama has any more say on matters of finance/economics than say the Queen of England has in her own country…

    • Trilateral Commission? Illuminati? Skull and Bones? Masons?

      • Frilton Miedman says:

        Opensecrets.org + SuperPAC’s (hidden) + corporate/banking lobby + biased media + the filibuster = A president that cannot appoint anyone unless enough campaign donors back it.

      • ch says:

        No indictments, no changes to the financial system following the biggest crisis in 80 yrs, while the financial sector is the biggest political donor.

        Ever read Simon Johnson’s “13 Bankers?” Summers plays an interesting part in that.

  18. Blur says:

    This is more disturbing than 4chan /b/.

  19. Petey Wheatstraw says:

    Summers would be even more qualified if he were lobotomized.

    Obama isn’t a rube. He’s going along to get along — as the Financial “industry” (and other super-citizen corporations), already own the political power structure lock, stock, and barrel. It’s governmental capture, top to bottom. Nothing is as profitable to this arrangement as a financial insider who can fuck up a one-car funeral procession and still have the balls to boast that he’s a good driver.

  20. Doug of North Texas says:

    See Naked Capitalism blog – Why Larry Summers should not run anything larger than a dog pound – for interesting material on Summers at Harvard (blew up the funding, for one thing).

    • rd says:

      I don’t know what Summers’ views on dogs are. If they are anything like his views on women, he is probably not appropriate for the dog pound.

  21. Katya G says:

    Summers is the worst choice. With him we’re going to see rates increased much earlier than we need. I was giving Obama much more credit. If it’s true – it’s a big disappointment.

  22. Chief Tomahawk says:

    Larry Summers is fortunate to operate just out of the public eye. Further, it would be naive to think there aren’t big-money beneficiaries lined up behind Summers — because they benefit from his ‘broken’ moral and ethical compass.

    I think we should dress him in a gimp outfit and drop him at The Hague. But they would probably figure it out and send him back …

  23. S Brennan says:

    On the bright side; if Ezra is right…it will be the first time in his short life [if long punditry].

  24. Frilton Miedman says:

    I agree about Obama’s acumen when it comes to common economics, and if anyone thinks economic naivete is in any way harmless when it comes to a presidents appointments, think Bush.

    Recalling the Feynman blog this weekend, his innate propensity state he didn’t have an answer when he couldn’t explain something in layman terms rather than bedazzle the audience with his intellect..

    To the opposite extreme,
    Summers is one of the most adept I’ve ever seen at answering a simple question with a lengthy essay replete with complex economic terminology while saying absolutely nothing at all.

  25. jib10 says:

    This is a red herring. Who says this? Unnamed sources. I bet they come from Summers camp. It will make Janet Yellen much easier to get through the Senate to float Summers name out there.

    Although the theater of Summers in front of the senate for confirmation would almost be worth it.

    Almost, I mean the head of the Fed can’t do that much damage, right? Right?!?

  26. constantnormal says:

    Truly, “Chains we can believe in”

  27. donna says:

    This post and the DKos one twittered to @barackobama. Suggest everyone do the same….

  28. jbforbes says:

    The ultimate personification of the phrase “failing upward”….

    • rd says:

      the only redeeming part of the nomination would be the amusing hearings where the GOP Senators are reviewing Larry Summers’ views on the role of women in society and the economy.

  29. foss says:

    I’m going to take the other side of this.
    I want Summers to fail, badly, I want him to fail, in the moment – not like Greenspan, who walked as a god at the time only to be struck down and reduced to shreds after he left his perch.
    I suspect that the exit from QE will go badly, or there will be no exit. Either way, I’m seeing the next Fed hair in a no win situation – either historically (legacy) or with the ground shaking beneath their crisis laden feet.
    I’d rather watch Summers brought to his knees than Yellen. So yes, I’d like to cut off my nose to spite my face. But hey, that’s just me.

    • bear_in_mind says:

      Well, your intentions are pure, even have a potential public good attached. However, the misery and suffering that type of failure on a broad swath of the country is unconscionable, at least if it can be prevented. But yes, there’d be a certain measure of schadenfreude that would accompany watching Summers navigate the economy onto the rocky shoals of economic ruin.

      Frankly, I didn’t see anyone else reference this, but I don’t think the guy’s health might rule him out him for the job. And I’m not talking about his weight. I’m referring to his general appearance. To me, he just doesn’t look like a healthy man, and while I’m sure Government Sachs would have someone warming the bench in the event of an untimely transition, I just don’t see how the pros he offers (to the country and administration) outweigh the cons.

      We’ll see… but I will be sending a fax and/or e-mail to the attention of the B. Obama to express my feelings about Mr. Summers’ suitability given his heinous track-record with regulating derivatives, managing Harvard’s endowment, and generally not playing well with others.

  30. fraud guy- also says:

    One fairly obvious lever that Rubin has available for continuing White House influence is Sylvia Mathews Burwell, the head of OMB. She was Rubin’s chief of staff earlier in her career and will clearly have a large voice in any economic matter, such as appointment of Federal Reserve chair. She also went to college at Harvard when Summers was a young star faculty member there, so she may still be influenced by her adolescent deference to him.

  31. Mbuna says:

    First off I think Obama is some kind of Manchurian (candidate) president. Or maybe he is simply to weak or in too weak of a position to do anything but what he is told to do in certain situations. Maybe he is just too beholden to the financial powers that be. At this point I can’t imagine him doing anything but what Wall St and the moneyed interests want. Who would be better for them than Summers? Give me an answer if there is one.

  32. Francois says:

    A pundit gotta ask the President: “What are you smoking Sir?…Seriously!”

  33. Rich in NJ says:

    Some trial balloons are shot down. Maybe this is one of them.

  34. Willy2 says:

    Perhaps the Obama administration wants to make Summers the fall guy for the next leg of the financial disaster. Perhaps Janet Yellen (a.k.a. the serial printer) hopes Summers will be run out on a rail and then she can take the credit for the economic recovery. I think a lot of people see what’s about to happen and have declined to be a candidate.

    What’s the reputation of Ezra Klein at the Wa-Po ? Some consider the Wa-Po along with the NYT to be the mouthpiece of the US government.

  35. NeedAJobbyFreddy says:

    When our economic models are based on the belief that rapidly batting flyswatters in and up and down motion can make you fly, the pilot is not really important. However, Larry Summers as Fed Chief calls for a modification of a popular idiom in the English language: those who can; do, those who can teach; teach, all others, well, you can run the Fed.

  36. Moss says:

    No doubt Summers would be OK with the Clinton political machinery. Remember that whoever gets the job will be part of the next administration. Obama is as concerned with his so called third term as he his with his remaining time in office. It is a shame that politics has reached into every aspect of everything.

  37. AtlasRocked says:

    O is a naif? Once fooled, twice a fool, thrice a fox playing a fool.

    Obama wants you to think he’s stupid, he is not. He and the leftists in charge plan to run up the debt and leave the bills for the savers. Witness Robert reich’s recent quote:

    “Politically, it would come down to a question of whether the more affluent areas of this “Detroit” were willing to subsidize the poor inner-city through their tax dollars, and help it rebound. That’s an awkward question that the more affluent areas would probably rather not have to face.”

    Now go look at the treasury’s debt to the penny page, plug in a year of data and observe : They’ve created a bank that is not tracking how much money they are borrowing any more, they simply have cancelled the addition of debt while Jack Lew, the documented liar, is in charge.

    http://www.treasurydirect.gov/NP/debt/search?startMonth=01&startDay=01&startYear=2013&endMonth=07&endDay=23&endYear=2013

    Once fooled, twice a fool, thrice the fool accuser is using “fool” to fool you.

    • Petey Wheatstraw says:

      Leftists?

      Really?

      You still see left-wing politics as a force in US political structure?

      Perhaps you meant to write, ‘neo-liberals’.

      As for your comment, below, please define “regulated capitalist,” and then name one.

      The only failure of US political policy has been three decades of crap-in-the-village-well, pseudo-capitalist, faux “conservative” mumbo jumbo.

  38. AtlasRocked says:

    The left is in a diifferent belief system: what a regulated capitalist sees as success , they see as failure; what we see as failure, they see as success.

    Observe them in debate: they never yield to points a capitalist makes.

    • Frilton Miedman says:

      So, in comparing the left/right track record for the last 30 years, where Reagan first begin this rate of increased debt trajectory, Clinton then turned it around and left us a surplus, Bush reversed it to an greater extreme and added a blank check to pharmaceutical industry and defense contractors, such as his Buddy Cheney’s Halliburton – with Cheney citing that “Reagan proved deficits don’t matter”, then presided over one of the greatest mistakes in laissez Faire capitalism in history, that resulted in as much as a 40% depletion in middle class net worth that’s been transferred to offshore tax havens. –

      And you say “The left is in a different belief system: what a regulated capitalist sees as success , they see as failure”. – I guess this boils down to what your definition of “success” is.

  39. theexpertisin says:

    “Ask not what your country can do for you. Ask what you can do for your country.”

    Obama must think this is but another right wing slogan meant at derailing his coalition of greedy parasites.

    Summers, political hack and Big Financial maven, is another nail in our country’s coffin.

  40. DeDude says:

    If Obama does this then a lot of democrats will leave him to sail his own sea. Putting in charge one of the arrogant idiots who were responsible for the financial crisis (and have never identified, let alone admitted, the flawed models that made him support what he should have been fighting against), would be a disaster in so many ways. Including that it may induce many of those who have been holding their nose and supporting Obama (because he is better than the alternative), to just turn around and walk away.

    Is there a “What’s Wrong With Larry Summers!” website somewhere with a comprehensive list of all the flaws this man has as a leader and thinker?

  41. Kevin_In_Philadelphia says:

    This is a crytal clear example of why this president is such an incredible dissapointment to those of us on the Left, as well as people who…you know…think.

  42. callistenes says:

    A more perfect example of the Peter Principle cannot be found.

  43. guadas says:

    In a “perfect world”……

    Aid to Obama: “What about Larry Summers?”

    Obama (eyes rolling): “Larry?…..are you kidding?”

    Another Aid: “Well, he REALLY wants the job!”

    Obama: “Too much blowback from what I hear and no way of confirming…BUT…hmmm….I think this may work out for me”

    Aid: “What do you mean Mr. President?”

    Obama: “He’s such a pain in the ass and wants his hands in EVERYTHING. The guy is relentless. Jeez….I can’t imagine more years of having him in the room letting EVERYONE know that HE KNOWS EVERYTHING! That’s MY JOB, after all!”.

    Aid: “What were you thinking then?”

    Obama: “OK….he thinks we owe him this. Let’s let others do the work we don’t want to. Run his name up the tree and when they tear down that branch we’ll have our excuse”

    Aid: “Excuse?”

    Obama: “Yeah….OUR excuse. You know Larry, we tried and we ran a trial balloon up and it didn’t do too well. We just don’t see how you can be confirmed. HEY, we tried and went to bat for you but…..”

    Aids: “Great idea Mr. President”

    Obama: “Thanks….we’re really gonna show Larry what HOPE means!!!….HA HA HA!!!!”

  44. Roger Bigod says:

    I’m looking forward to his Op-Ed in the NYT where he’ll explain that female economists just aren’t cut out to be Fed chairman.

  45. Onemoretime says:

    And Felix adds: “If you want to repeat all of the Clinton-era mistakes of financial regulation, you can’t do better than appointing Clinton’s very own Treasury secretary.”

    http://blogs.reuters.com/felix-salmon/2013/07/24/dont-send-summers-to-the-fed/