Larry Summers

Larry Summers

As best as I can tell the only reason Larry Summers may be President Obama’s top choice to head the Federal Reserve is that Obama personally likes him and Summers doesn’t suffer from the affliction of having two X chromosomes. Summers fails all of the main tests for what makes a good pick.

Summers is clearly not the most qualified; that title belongs to Janet Yellen who currently serves as Vice Chairman. Nor is Summers a smart political choice who could have an easy time getting confirmed. Summers’ long track record of big policy failures and aggressive involvement in political fights means he has plenty of enemies on all sides. Both the left and the right have ample reasons to oppose him. Summers would be a serious and needless fight.

It might be worth a fight for truly bold policy pick, but Summers is not one. Summers lacks a unique outlook that would make him a powerful signal that Obama wanted to significantly change the Federal Reserve. Picking someone like Christine Romer or even someone like Paul Krugman, could signal Obama wants to significantly change Federal policy. Summers would not be a bold change.

Summers is a status quo pick with significant amounts of political baggage. The only justification for picking Summers seems to be Obama considers him a BFF and sexist code words like “strong enough.”

If Obama were to pick Summers, it would once again make Summers the prime living example that America is not a meritocracy.