Progressive Litmus Test: Opposition To Larry Summers

Posted by Bob Lord

Obama seems hell bent on nominating Larry Summers to be the next Fed Chair.

And progressives, particularly progressive women, are rightfully howling.

This is a true litmus test for the progressive community, and a test of our own grit.

If ever there was a time for progressive community and progressive members of Congress to draw a line in the sand and demand Obama not cross it, this is it. Summers is the consummate DLC / Third Way Democrat. His allegiance is to millionaires and billionaires, not working people. It's not that Janet Yellen would be a better choice, it's that there are about 100,000 better choices out there.  

And if a Rep or Senator voices support for Summers or fails to oppose his nomination, understand that Rep or Senator will not work for economic justice, no matter how much he or she supports abortion rights or same sex marriage. 

Here are a few passages from Sam Stein's piece at Huff Po, Larry Summers, Janet Yellen, and the Fractious Debate Over the Next Fed Chair:

Summers clashed with fellow members of the Obama team. Noam Scheiber, in his book The Escape Artists, reported that he sidelined Christina Romer, then the chair of the Council of Economic Advisers, when she tried to persuade the president to pursue a larger stimulus package. Meanwhile, Sheila Bair, the former Federal Deposit Insurance Corporation chair who had warned of trouble in the subprime lending market, was left out of most major financial policy decisions.

"The attitude was that they already had all the answers and were talking to us only because the president wanted them to," Bair wrote in her recent book regarding Obama's top economic advisers. "Larry and [Treasury Secretary Tim Geithner] didn't seem to care about the political beating the president took on the hundreds of billions of dollars thrown at the big-banks bailouts and AIG bonuses, but … I don't think helping homeowners was ever a priority for them."

I'm leaving out the stuff about Summers' misogyny, although that legitimately could be viewed as a disqualifier. Here's more on Summers questionable record:

Certainly, Summers has jousted with male colleagues as well as female ones. Former Office of Management and Budget Director Peter Orszag can attest to that. And for a number of Summers' detractors, it's the positions he's taken in those battles — not the person he's battling — that's cause for concern.

Clinton and others in office in the late 1990s have said Summers erred in pushing a de-regulatory platform at the time, during a period when Glass-Steagall financial regulations were repealed and the derivatives market was unshackled.

"Anyone who is being considered on Fed chairmanship should have to talk about Glass-Steagall, about the repeal and about their position on a modern-day version of it," former Sen. Byron Dorgan (D-N.D.) told HuffPost. Dorgan, now a lobbyist with Arent Fox, was one of only a handful of senators to vote against repealing the regulations.

"My hope is that [Obama will] look outside the very small talent pool that they usually look to," he said. "You know what I'm talking about? A talent pool that comes from Wall Street. There are a lot of really talented well qualified people outside that talent pool."

Critics also point out that Summers was part of an Obama economic team that let the banking industry off easy after it cratered the economy.

"Summers protected the big banks from being taken over when they were insolvent, and he has been a consistent foe of any serious effort to rework the financial industry," said economist Dean Baker, co-director of the Center on Economic and Policy Research. For good measure, Baker noted that Summers earned millions from financial sector interests, including bailed-out Citigroup, around his stints in the public sector.

Obama didn't need to pick this fight with progressives. Whatever the price, he and any Dem who supports him on this should be made to regret the decision. It's just unacceptable.

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