THE PLANK NOVEMBER 10, 2008
Noam has made most of the essential points about Lawrence Summers, who remains (as far as I know) one of two people under consideration to become Barack Obama's Secretary of the Treasury. But I wanted to add one thought, relevant--I hope--to other liberals like me.
On the issues I know best and over which the Treasury Secretary has sway, Summers is good. Very, very good. In the last few years, he has become a persistent critic of inequality and advocate for government action to redress it. He's a true believer in health care reform, both as a way to alleviate economic insecurity and to address the country's long-term fiscal crisis. He wants major action on climate change. And he has argued for aggressive action to stimulate the economy, despite high deficits. As he wrote in a September column for the Financial Times:
...in the current circumstances the case for fiscal stimulus--policy actions that increase short-term deficits--is stronger than at any time in my professional lifetime. Unemployment is now almost certain to increase--probably to the highest levels observed in a generation. Monetary policy has very little scope to stimulate the economy given how low policy rates already are and the problems in the financial system. And experience around the world with economic downturns caused by financial distress suggests that while they are of uncertain depth, they are almost always of long duration.
Summers is not the only economist who holds these views nowadays. But few can espouse them with the credibility and wide-ranging influence that Summers possesses. Leaders in government and the private sector, both here and abroad--all of them trust him, both for his intelligence and experience.
And that would matter where it counts the most: in the White House. When Obama is making decisions, some of his advisors will be making the case against activist interventions--sometimes on policy grounds, sometimes on political grounds. That'll be their job and, sometimes, they'll be right. But Summers can be counted upon to push back and to push back hard.
I'm not arguing that the job should necessairly go to Summers. To make that judgment, I'd have to know a lot more about his chief rival for the post, Tim Geithner, who sounds awfully impressive in his own right.
But I do know that Summers--whatever his shortcomings, real and perceived--would be a passionate, effective advocate for progressive economics in the White House. That's not something to take lightly.
Update: Huffington Post has a post from Sheryl Sandberg, who worked with Summers at the World Bank and Treasury, about his record on gender issues. She cites everything from his interest in advising a college thesis (hers) on the economics of spousal abuse to his efforts at improving Social Security benefits for women working at home. "Many people note that our nation has few economists with his
intelligence," she writes. "They should also know that we have few leaders, if any,
in the financial world who have done more for women.
Be sure to check out Noam Scheiber's defense of Larry Summers here.