Sayonara, Larry Summers

A friend who worked with Larry Summers once told me that he is not as smart as he thinks he is. To which I replied, how could he be? Thankfully, he was smart enough last Sunday to remove himself from consideration for chair of the Federal Reserve, a move that delighted the stock market, liberal senators and me. Summers has an impressive pedigree (both parents teach economics at Penn and two uncles, Paul Samuelson and Kenneth Arrow, have Nobel Prizes in economics) and resume (World Bank Chief Economist, Treasury Secretary, Director of the National Economic Council, President of Harvard). Yet his career has been like the Peter Principle (in which people “rise to their level of incompetence”) on steroids. He has been wrong on almost every major issue he has touched. He advocated massive deregulation of the banking industry and vigorously opposed any oversight of derivatives. These policies, combined with the Bush doctrine of massive tax cuts for the rich and off-the-books military invasions, produced the worst financial disaster since 1929. Less well known is Summers’ hostility toward environmental regulations, especially for greenhouse gases, because of their perceived adverse impact on growth. Summers boasts that his policies pushed America into the 21^st century, but in a nation where 95% of all recent income gains have gone to 1% of the population, where income disparities are greater than they have been since the Gilded Age, and where global climate change is still scorned, he has actually helped usher us back into the 19^th.