I’ve been watching the internecine debate among Democrats over whom Barack Obama should appoint as the next chairman of the Federal Reserve, former Treasury secretary and Obama adviser Larry Summers or current Federal Reserve Vice Chairman Janet Yellen. Some of Yellen’s backing comes from those who think it’s important to have a woman in that position, but others make an affirmative case for her as a smart economist, and I haven’t seen anyone I respect argue that she isn’t.
But I also haven’t seen anyone argue that Larry Summers is not a supersmart economist. The case against him is that he is uncollegial and arrogant and that he supposedly slandered women when he was president of Harvard when he suggested that the reason there might not be so many women science academics is that more men have the aptitude for that. (This should not be controversial, since many studies show that men are more likely than women to have both very low and very high levels of intelligence.)
Two former colleagues have come to Summers’s defense, Harvard Law professor (and former director of the Obama White House regulatory office, OIRA) Cass Sunstein and New York investment banker and Obama auto bailout adviser Steven Rattner. I certainly don’t agree with them on everything, but they are both smart and original thinkers; Sunstein is probably the most market-respectful person free market economists could imagine Obama appointing at OIRA.
Sunstein and Rattner paint a picture of Summers as argumentative, but also willing to listen to others and to change his mind on occasion. Both disclose that Summers is a friend, but they both make a strong case which sounds like more than a pro forma defense of an old friend. Barack Obama reportedly made similar remarks when he faced hostile questions about Summers in his meeting with congressional Democrats last week.
My own brief acquaintance with Summers is consistent with that. Some years ago he told me he liked my (not at all partisan) book Hard America, Soft America, which argues that we should make more of American life “hard,” i.e., subject to competition and accountability. I can’t imagine why Summers would have picked up my book, except that it is very short and he, undoubtedly a fast reader, could polish it off in a sitting.
There don’t seem to be great differences on policy between Summers or Yellen, or at least discernible ones, and in any case no one can predict the economic environment which the next Fed chairman will face between 2014 and 2018. But I think Cass Sunstein and Steven Rattner make a strong case for Larry Summers.