Larry Summers, Politician

Lloyd Grove has a long interview with Larry Summers today. The political bit is the most interesting: Summers all but says he’d love to return as Treasury secretary ("I’m very happy right now doing what I’m doing, teaching and consulting and writing on public-policy issues… I think I answered your question, Lloyd. I said as much as I’m going to say)".

He then launches into some surprisingly pointed rhetoric about the difference between the Obama and McCain economic policies. A lot of it hits the mark, but not all of it:

I think moving beyond a "trust the market no matter what, what’s best for Wall Street is what’s best for America" approach to the financial markets is important if the economy is to work. That’s what Senator Obama favors…

The other side has mostly described the additional taxes it’s going to cut for the top 1 percent. And those several trillion dollars of deficit–it’s not my estimate, and it’s not some Democratic adviser’s estimate, it’s think tanks that review both sides’ proposals–those extra several trillion dollars are, I think, likely to be quite burdensome on the economy. They took a risk with foreign confidence in our system, they took a risk with our vulnerability at a time when for the first time in history, really, the world’s greatest power has made itself the world’s greatest debtor…

Yes, it may be that policy over the last eight years has been simple to describe, but the descriptions haven’t fit the reality, since spending has gotten completely out of control on bridges to nowhere and much else, and the consequences for ordinary families have been disastrous.

This is much closer to politicking than it is to sober analysis. Would McCain be friendlier to Wall Street than Obama? That’s far from obvious. Is McCain more inclined to trust the market than Obama is? That’s not clear either.

And it’s just silly to say that the US became the world’s greatest debtor under George W Bush — it was already the world’s greatest debtor when Summers was Treasury secretary, and there was no one more concerned about the concomitant vulnerabilities than Summers himself. The preconditions for a crisis were in place under Summers, and although Bush did nothing to alleviate them, he also can’t shoulder all of the blame.

As for spending being "completely out of control" — well, for one thing, it isn’t, and for another thing, insofar as it is out of control, that’s entirely a function of the cost of the war in Iraq and has absolutely nothing to do with bridges to nowhere or other earmarks. But it’s much easier, politically, to criticize a bridge to nowhere than it is to criticize spending on the Iraq war.

What all this says to me is that Larry Summers is now in full-on campaign mode, and doesn’t mind stretching the truth in the service of his candidate. Will that be enough to get him a job offer should Obama become president? Probably not — Obama’s keen on being a man of the future, and hiring Summers would make Obama look like more of a throwback to the 1990s. But I’m quite sure that if the job offer arrived, Summers would accept with alacrity.

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