Wednesday, August 21, 2013

WaPo Continues Not So Subtle Front Page Campaign For Summers

The Washington Post is at it again, the Washington newspaper of record, with a front page story by Zachary A. Goldfarb, "Allies of Fed candidates wage battle behind scenes."  However, the vast majority of the story quotes supporters of Summers, including Tim Geithner and Brad DeLong, with discussion of how various other figures associated with the current or past Dem administrations are organizing themselves with the consent of Summers to make his case.  The tone throughout is that he is under an unfair attack and has simply been very constrained in not responding until now against all this unreasonableness.  Furthermore, the attacks are coming from "liberals" who want regulation and "doves." Obviously Very Serious People need to put this unruly crowd in its place.

So, only about 5 out of the 27 paragraphs discuss Yellen in a positive way at all.  The only person quoted defending her and commenting on how the White House is simply ignoring her and not interviewing her is, of course, another woman, Christina Romer, although it is mentioned that Alan Blinder is supporting her.  But, hey, women, doves, sissies for regulation, these are not the serious Wall Street types and policymakers who are joining together to defend the unfairly attacked Larry Summers, poor thing.  There is not the remotest hint that the overwhelming majority of the economics profession is supporting Yellen over Summers.  All I can think is that these WaPo reporters are pathetic puppies wanting to keep their access to the White House open and are thus parroting the lines handed out by Sperling and others.  After all, Obama likes this guy.  Why is everybody not going along?

The one other note in the article that suggests maybe somebody in the White House needs to stop playing these games is the announcement that a Republican senator, Pat Roberts of Kansas, has come out against Summers, declaring that "I wouldn't want Larry Summers to mow my yard." This suggests that indeed Larry may have problems that Janet would not have, and that Obama really does not need.  OTOH, in another post elsewhere, apparently neutral Jared Bernstein has declared that he does not want to see either Summers or Yellen mowing his lawn, :-).

Barkley Rosser 

Update, a few hours later, let me add a few more comments.

1)   A further angle that the WH gang led by Sperling is pushing in their quest to be the VSPs supporting the oh-so serious Larry Summers is that it is only ignorant extremists from both ends of the political spectrum who would be so silly as to support Janet Yellen.  Pat Roberts from the GOP is obviously a joke with his comment about mowing yards, and, well, on the Dem side is just those leftist libs who oppose free trade and all sorts of other reasonable things who cannot see how wonderful the brilliant Larry is.  Sorry, folks, but this will not fly. 

The propagandists pushing Summers must deal with the fact that is that indeed the sentiment among the vast majority of the econ profession supports Yellen, across methodological and ideological spectra.  The gang supporting Summes is a tiny minority, most of whom are closely connected with each other, but who are treated with equal weight in the WaPo accounts, much as with the old story about how flat earthers are given credit in the media with round earthers.  As it is, this consensus is dismissed as "blogosphere noise" (obviously disgusting and to be repudiated).

2)  Brad DeLong.

I am not going to pick on Brad.  I have told him in public that I respect that he is loyal to his old friend and coauthor and coworker, Larry Summers, and I continue to hold to that.  I am someone who values personal loyalty and friendship above many many things.  He has been furiously blogging recently in Larry's favor, even repeating today on FB his Aug. 1 bottom line favoring a "fabulous five," which even had three women among it, no sexist Brad! (besides Yellen, Romer and Tyson).  The fifth was the openly pro-Yellen Alan Blinder, although he missed the still Obama-officially designated third choice, Don Kohn. 

So, what is Brad's argument at the bottom line?  He treads a careful line, being a member of the same department as Yellen and her husband (now emeritus) George Akerlof?  He says that he supports Summers just barely over her.  She is clearly acceptable, as are any others of his top 5, but nobody else (sorry, Don).  He is in fact never able to find any actual clear fault with her, but in the end it gets down to this vague argument that Summers is more creative and innovative than she is, that in a very serious crisis, she will just represent worn out doctrines and established ideas, whereas he will find new wonderful solutions.

I am sorry if I find this argument unsatisfying.  On his blog I have pointed out that Summers's management of the Asian crisis was criticized by many, including Joe Stiglitz, with him simply pushing the now-seriously-revised Washington Consensus of austerity on nations with current account and budget surpluses, with many of them suffering deep declines and slow recoveries for years afterwards, e.g. Indonesia.

The record is clear that in fact Yellen has the better forecasting record than Summers, for all his loudmouth bravado.  The extreme demo of this was the WSJ account recently where on one day the editorial page made the supremely stupid argument that appointing Yellen would lead to a supposedly awful "female-backed currency," when on the next day the front page news section demonstrated that she had the best forecasting record of any of the top 14 figures in the Fed, including Bernanke.  While Summers was not in that study, it did not take more than about two seconds to figure out that he would have struggled to be above the middle on that list.


Shag from Brookline said...

Deep down, why does Summers want this job? Is it to depart Harvard in the sense of a career promotion? How much of a team player (whatever that means, especially as teams change) can we expect the smartest man in the room to be? Ergo, ego? Better yet "no go." said...

He is a power hungry egomaniac, and there is no position in the world primarily involving economic decisionmaking that is more powerful than the Chairmanship of the Board of Governors of the US Federal Reserve. Of course he wants it, and badly.

CrocodileChuck said...

What difference does it make who gets it? Every month the Fed meets, to decide one thing: should it keep interest rates the same, or change?

Why do we even need the Fed in the first place?