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More On Yellen and Summers


First of all, what Krugman and and Ygelsias said about “gravitas,” which in this context appears to be a synonym for “male.” (By the way, anybody think that a woman with the Ph.D. – devoid Tim Geithner’s credentials would even be considered for the job? And, no, the fact that he was even considered does not make me optimistic that Obama will do the right thing.) The whisper campaign against Yellen reminds me of the smear campaign against Sonia Sotomayor.

Brad DeLong, meanwhile asks why Summers is viewed by the left as a “right-wing hyena.” And, sure, Summers isn’t an across the board conservative, and I assume that (as the op-eds Brad cites suggest) he’s been nudged to the left by the financial crisis and the increasing radicalism of the Republican Party. More relevant than the op-eds, if one was making a case for Summers, is that according to Michael Grunwald’s definitive history of the ARRA Summers sided with Romer rather than Geithner on the size of the stimulus. Still, those op-eds and his support for a large stimulus aren’t the only relevant information; liberals haven’t forgotten, for example, his embrace of banking deregulation in the 90s, which he was still defending as recently as 2005. So, sure, Summers isn’t a right-wing hyena; I’d rather have him as Fed Chair than Alan Greenspan or Tim Geithner or (based on the less I know about him) Donald Kohn. But those aren’t the only options. The question is Yellen versus Summers, and I just don’t see any way to make a good case for Summers in that context.

Ideologically, Yellen isn’t radically different than Summers, but if the Fed Chair was a unilateral decision maker I think you’d rather gamble on Yellen than Summers; the former has a clearer record of being a relative monetary policy dove, while we basically don’t know anything about Summers’s views on monetary policy. Summers might turn out to be essentially similar to Yellen, but as Remo Gaggi would counsel us, “why take a chance? At least, that’s the way I feel about it.”

But the Chairman of the Fed isn’t a unilateral decision maker, and that’s where the case for Yellen becomes nearly unassailable. Yellen has the relevant experience suggesting that she can work with the people she’ll need to go along if she’s going to be able to implement her preferred policies. Conversely, the management demands of the Fed Chairman entail the kind of management that virtually all accounts of Summers’s tenure at Harvard suggest he’s worst at — i.e. managing near-peers who are below him in terms or organizational rank but aren’t inclined to accept subordinate status. Now, maybe Summers learned something from his experience at Harvard and would be better at the Fed, but again I’ll cite Remo. You know Yellen can do the job well, so why take a risk that’s pretty much all downside?

And, finally, I’ll reiterate that to pick Summers over a woman with more impressive formal qualifications for the job would, given Summers’s gender baggage, have a particularly rank odor both substantively and politically. Yellen is the obvious choice here, and if Obama doesn’t make it he deserves all the criticism he gets, and if he gets a caucus revolt in the Senate he can’t say nobody told him.

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