Larry Summers Talked Himself Out of a Job

The top economist, who withdrew his name to lead the Fed, is still haunted by comments on Africa and women.

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Larry Summers (Jim Davis/Getty Images)

(The Root) -- How do you solve a problem like Larry Summers? (Taking a page from The Sound of Music -- just pretend you're too young to have seen this.) The economist has been the big man on campus, having served from 2001 to 2006 as Harvard University's president, and now a top professor at Harvard's Kennedy School of Government. In between, he was the head of the National Economic Council under President Barack Obama. He also mentored this student named Sheryl ... you know, Sheryl Sandberg, now chief operating officer of Facebook and author of the best-seller Lean In.

So when Summers' name was proffered this year as the potential head of the Federal Reserve -- the central bank that sets monetary policy affecting America and the world -- many people saw him as a shoo-in. There was just a little problem: Summers himself.

In addition to having held scores of top jobs (don't forget that he was also Treasury secretary under President Bill Clinton and chief economist of the World Bank), Summers has a running case of logorrhea. He speaks so freely that his own words trap him. For example, he stepped down as Harvard's president after a vote of no-confidence. It was spurred in part by his statement that "issues of intrinsic aptitude" kept women and girls from achieving as highly as men in math and science.

His subsequent efforts to say that this was just a theory he hoped was wrong only served to make him look indecisive in his bias. More to the point, critics, in assessing his record, say that Summers has not stood up for Americans in the face of corporations' fast-and-loose moneymaking schemes.

A recent article in the magazine Mother Jones outlines the many ways that Summers opposed regulating banks and hedge funds in the derivatives market before the Great Recession, stating, "Partly because of this lack of derivatives oversight, few people saw the 2007 derivatives market meltdown coming." On Sunday, when he stepped out of the running to lead the Fed, Summers said in a letter to President Obama, "I have reluctantly concluded that any possible confirmation process for me would be acrimonious and would not serve the interest of the Federal Reserve, the Administration or, ultimately, the interests of the nation's ongoing economic recovery."

For his part, the president responded to Summer's withdrawal from consideration by calling him "a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom, and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today."

 

It's also critically important to understand some of the global ramifications of Summers' leadership, since, by all accounts, the economist has continued to have the president's ear. In 1991 Summers signed a memo drafted by a colleague at the World Bank. It stated that African nations were underpolluted, then called for dumping toxic wastes in the continent and capped it all by saying that since Africans were more likely to die young than Westerners, well, who cares about the mortality issues? It might be equivalent to my saying that because young black men in inner cities are more likely to die from gun violence, why not just dump confiscated guns into the hood and let social Darwinism have its day? Summers later said he was being sarcastic.

Summers' peers were not amused. José Lutzenberger, who was then Brazil's secretary of the environment, wrote Summers: "Your reasoning is perfectly logical but totally insane ... Your thoughts [provide] a concrete example of the unbelievable alienation, reductionist thinking, social ruthlessness and the arrogant ignorance of many conventional 'economists' concerning the nature of the world we live in ... If the World Bank keeps you as vice president it will lose all credibility. To me it would confirm what I often said ... the best thing that could happen would be for the Bank to disappear."

Lutzenberger lost his job. Summers, as he often seems to have done, just went upward and onward -- even when his policy pronouncements didn't protect us.

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