The powers that be want to see Larry Summers get the Fed chairman job instead of Janet Yellen [top]:
Choosing the Next Fed Leader, NY Times
A Yale educated economist and professor emeritus at the University of California, Berkeley, she was first nominated and confirmed to the Fed board in the 1990s; from 2004 to 2010, she served as the president of the Federal Reserve Bank of San Francisco. She has been vice chairwoman since 2010, a trying time in which the Fed’s largely successful efforts to steer the economy have been made all the more difficult by poor fiscal policy decisions, including the White House’s premature pivot from stimulus to deficit reduction, which happened while Mr. Summers was a top adviser to Mr. Obama.
What has changed in the past week is that the power dynamics around economic policy-making have become more public than normal. Mr. Rubin and his circle — including Mr. Summers; Timothy Geithner, Mr. Obama’s first Treasury secretary; and Gene Sperling, currently a top economic adviser to the president — have dominated economic decisions in both the Clinton and Obama administrations. Most of them were also prominent in Wall Street circles in the George W. Bush years. In the wake of the financial crisis and the Dodd-Frank reform law, the Fed chairmanship has only become more central to the fate of the banks and economy; as a result, they want someone who shares their background and can be counted on to further their views.
Ms. Yellen is not that person, not only, or even mainly, because of policy differences but because she is not part of the fraternity. Indeed, she is reminiscent of other accomplished women with whom Mr. Summers, or his supporters, or both have tangled in the past.
In 1998, Mr. Rubin and Mr. Summers opposed Brooksley Born [2nd from top], then the chairwoman of the Commodity Futures Trading Commission, for correctly calling for the regulation of derivatives; in 2009, Mr. Summers squelched the sound recommendation of Christina Romer [3rd from top], then an economic adviser to Mr. Obama, for a larger stimulus. In the first Obama term, Mr. Geithner clashed unhelpfully with Sheila Bair [4th from top], then the chairwoman of the Federal Deposit Insurance Corporation, and with Elizabeth Warren [bottom], then the chairwoman of the Congressional panel overseeing the bailouts.
Please, please, not another white male member of the Rubin cabal.Blog comments powered by Disqus