By Dan Kervick
Various types of backlash appear to be growing against Lawrence Summers in the political fight over who should be the next chair of the Federal Reserve Board of Governors. Josh Barro reports on a research note from BNP Paribas saying that “if President Obama picks Larry Summers as the next Federal Reserve Chairman, he will do serious harm to the U.S. economy.” Binyamin Applebaum develops similar themes in the New York Times. And Paul Krugman worries that a Summers appointment won’t produce enough media shock and awe to signal a “regime shift” and awaken the confidence fairies from their slumbers.
Unfortunately, many of these critics are overly concerned with short-term impacts related to market confidence, market neuroses and monetary policy fads, and are missing the point entirely. There is one surpassingly excellent reason for opposing the Summers appointment:
Lawrence Summers is one of the primary architects of the disastrous laissez faire policy revolution of the late 20th century that is responsible for bringing us the financial collapse of 2007 and 2008, and the Great Recession that followed that collapse. He is for that reason utterly disqualified for leadership of the nation’s central bank.
Personally, I’m not very worried about the so-called “hawk versus dove” split on monetary policy stimulus and what’s going to happen between 2013 and 2015. I’m worried about the Great Depression of 2025 that Summers is going to cause with his indulgent attitude toward financial innovation and his track record of disdain for regulation. I’m worried about his desire to make the bloated and parasitic US financial mafia even larger than it is. And I’m also worried about his own personal love of money-making and his evident cronyism and corruption. I’m worried about giving the quacks another shot at the gasping patient on the operating table.
The Rubinite gang from which Summers was spawned destroyed the US economy and the US social contract, and ruined the lives of millions of people in the process. They are directly responsible for the carnage we have been living through. And I’m not talking about the kind of carnage that consists in banksters getting smaller bonuses. I’m talking about mass unemployment, broken families, higher suicide rates, a vanishing middle class, failing cities, a bombed-out US industrial sector, vanishing labor power, unchecked greed and predation, and the evaporating hopes of a generation of young people in both the United States and Europe. Meanwhile, the zealots who carried out this botched economic operation, and their plutocratic cronies, have walked away with fortunes from the disaster, and have reaped almost all of the returns from the “recovery” so far. Summers is one of them: he has made millions in speaking and consulting fees since helping to ruin everything.
Enough is enough with these butchers. Stop them before they kill again!
Cross-posted from Rugged Egalitarianism