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Larry Summers leaving the White House

summersleaving1.jpg

It's official. Larry Summers, the director of the National Economic Council, is leaving the White House. He'll be returning to Harvard before the end of the year.

Summers's announcement comes on the heels of Peter Orszag's and Christina Romer's departures, but it's unquestionably the biggest of the three. As head of the NEC, Summers ran the White House's economic-policy process. He was also, by most accounts, Obama's lead economic adviser. His West Wing office put him physically closer to the president than any other member of the team. His long experience in government -- including a stint as Treasury secretary during the Clinton administration -- gave him a level of political seasoning that the other council members didn't have, and that Obama relied on heavily at the outset of his presidency. His reputation for brilliance gave him an edge in an administration that prizes academic accomplishment.

But Summers was also the most controversial member of the team. He'd worked part time for a hedge fund before joining the Obama administration. His tenure at Harvard was marred by an unfortunate comment about whether women were less likely to excel at math and science than men. He participated in the deregulation of the financial sector under Bill Clinton. And Summers's strong personality made him a lightning-rod for criticism and dissatisfaction within the White House: Many felt that his role as economic adviser to the president had overwhelmed his role as manager of the president's economic process.

Summers wasn't much liked by liberals. Stephanie Taylor, co-founder of the Progressive Change Campaign Committee, said his departure is "a big victory for anyone who voted for change in 2008 only to see Summers work from the inside to water down Wall Street reform, block President Obama's promise to protect Net Neutrality, and urge other pro-corporate positions." But his role in internal debates was often unpredictable: Summers was one of the administration's strongest advocates for rescuing Chrysler. On the other hand, he was also fingered for vetoing Christina Romer's argument for a $1.2 trillion stimulus before it even got to the president's desk.

His departure leaves a tremendous power vacuum in the Obama administration's economic policy team -- and at the exact moment that the recovery seems to be slowing. With Orszag, Summers and Romer gone, the administration is without three of its strongest voices. That makes the choice on NEC director -- the person who will have to build and manage the economic policy process as the new team gets its footing -- a lot more important. With Summers, the administration got a very strong economic adviser, but not someone known for his managerial talents. Now, as a host of less senior voices vie for influence, the administration might approach the choice of his replacement differently.

The early reports are that the White House wants to replace Summers with a female CEO, if possible. One candidate might be Ann Fudge, the former CEO of Young and Rubicam Brands, and current director for GE, Unilever and Novartis. In February, the White House named Fudge as one of two CEOs serving on the president's bipartisan National Commission on Fiscal Responsibility and Reform, so she's certainly on their radar.

Two other obvious choices would be Summers's deputies: Jason Furman and Diana Farrell. Farell wasn't a CEO, but she did come straight from the decidedly private-sector McKinsey Global Institute, where she served as director. Previously to that, she worked at Goldman Sachs, which may not be a plus in this particular political moment.

Photo credit: Chip Somodevilla/Getty Images

By Ezra Klein  | September 21, 2010; 6:07 PM ET
Categories:  Obama administration  
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Comments

Economic power is not the only vacuum in the White House. There is a huge vacuum of intelligence, and a desire to run the government with respect for our constitution and free enterprise system.

Posted by: thehamptons1 | September 21, 2010 6:39 PM | Report abuse

"There is a huge vacuum of intelligence, and a desire to run the government with respect for our constitution and free enterprise system."

Dear thehamptons1,
Words are cheap. And yours are funny, as you clearly lack either the foresight (intelligence?) to proofread and edit what you have written. Ironic, isn't it?

Posted by: Towards_Light | September 21, 2010 6:45 PM | Report abuse

One candidate might be Ann Fudge,
================================
Have they considered the "Factor" of Ridicule?

Posted by: kishorgala | September 21, 2010 6:50 PM | Report abuse

I'll drink to this!

Posted by: slantedview | September 21, 2010 6:57 PM | Report abuse

The serious problem for Obama is how to get anyone (regardless of his/her background) confirmed in time given the GOP's willingness to filibuster anything and anybody just to make his life miserable.

Posted by: serban1 | September 21, 2010 7:01 PM | Report abuse

Please, nobody from Goldman Sachs.

Posted by: maritza1 | September 21, 2010 7:33 PM | Report abuse

Please, no one from the Ivy League!

Posted by: shangps | September 21, 2010 7:38 PM | Report abuse

The person who replaces the execrable Lawrence Summers will be from the highest echelon of Goldman Sachs, you mark my words.

Posted by: nicekid | September 21, 2010 7:48 PM | Report abuse

Nothing like a looming election disaster to focus the politicians eh?

The people voted for change in 2008 and we ended up with the same people who gave us the financial meltdown still in control. Instead of the transformational figure we get a restorer of the status quo?

Time for Timmy and Benny to go back to where they come from also. The entire Fed governing board too, come to think of it.

Posted by: barrylarryandtimmy | September 21, 2010 7:52 PM | Report abuse

It means Summers is going to Harvard to start teaching Obama economics, which is to borrow and spend your country into submission into becoming a communist Global One World Order. And Harvard is going to let this happen. Are all you parents who are sending your children to Harvard going to let them be taught a bunch of lies?

Posted by: egw7777 | September 21, 2010 7:53 PM | Report abuse

It means Summers is going to Harvard to start teaching Obama economics, which is to borrow and spend your country into submission into becoming a communist Global One World Order. And Harvard is going to let this happen. Are all you parents who are sending your children to Harvard going to let them be taught a bunch of lies?

Posted by: egw7777 | September 21, 2010 7:54 PM | Report abuse

As one who has been complaining almost weekly to the White House about the three blind mice (Summers, Geithner, and Bernanke), aka the Rubin Deregulation Retreads, I couldn't be happier about Larry's departure. The big question, as this article points out, is who his replacement will be. With all the fine economic minds available out there, do we think perhaps our President just might finally allow some progressive thinking in the White House? Elizabeth Warren already has her hands full setting up the CFPA, and though neither of them would want the job, someone like Simon Johnson or Paul Krugman would certainly bring a fresh perspective. Maybe one of the guys who warned of the impending crash BEFORE the economy hit the fan, like Nouriel Roubini or Joseph Stiglitz. As long as the President is getting his advice from guys who are on the phone with Blankfein and Dimon more often than they are with him, we can expect more of the same--looking out for the boys on Wall Street while the rest of us are on hold.

Posted by: sailorashore | September 21, 2010 7:56 PM | Report abuse

"...and at the exact moment that the recovery seems to be slowing."

Recovery??? Slowing???
What in the hell are you talking about?
They really need to start drug testing journalists.

Posted by: tulsa_dave | September 21, 2010 8:09 PM | Report abuse

"The early reports are that the White House wants to replace Summers with a female CEO..."

This is non-sense. You don't do 'gender' business at that level; especially when USA is not like India where Bombay Stock Exchange is climbing everyday so it does not matter who is Cabinet Minister at Finance.

Names like Edward Whitacre the former AT&T chief and interim Chairman / CEO of GM might be easy to confirm as well as bring some sense. Not sure former GE head Jack Welch is still non-senile, he can be a choice too. John Doerr, Tom Perkins, Vinod Khosla, Michael Moritz (not sure whether he has naturalized USA citizen), past Intel CEO Greg Barrett, Bill Gates (he is unlikely to leave his Foundation Work); these are some other names.

Thinks out of box.

Posted by: umesh409 | September 21, 2010 8:43 PM | Report abuse

It's called cut & run from a no win scenario.

What you do when you don't want to be caught in a losing situation and want to salvage something of your career

Posted by: Straightline | September 21, 2010 8:51 PM | Report abuse

$100 says his replacement either went to the University of Chicago or served on the board at Goldman Sachs...

Posted by: jesusHhong | September 21, 2010 8:56 PM | Report abuse

What does it mean?

Nothing.

Posted by: James10 | September 21, 2010 9:37 PM | Report abuse

The person who replaces the execrable Lawrence Summers will be from the highest echelon of Goldman Sachs, you mark my words.

Posted by: nicekid | September 21, 2010 7:48 PM

====================

A decent possibility. But maybe it will be Christine O'Donnell. She does have budget experience. And she isn't Ivy League. Actually, I don't know for certain that she's not Ivy League. If she is, God help the Ivy League.

Posted by: James10 | September 21, 2010 9:44 PM | Report abuse

Good riddence larry Hello Warren!
Bye-bye Obama

Posted by: crrobin | September 21, 2010 9:53 PM | Report abuse

" But maybe it will be Christine O'Donnell..."

James10 is using classic deflection tactics to hide the fact that this is just one more bit of evidence against the epic FAIL that is the Obama Administration.

Posted by: jesusHhong | September 21, 2010 9:57 PM | Report abuse

No need for concern! Those three people leaving won't slow down the damage this administration is doing for long. New shiny faces full of zeal will replace them, possibly to do even more greater damage!

Posted by: deadmanwalking | September 21, 2010 10:08 PM | Report abuse

The rats are fleeing the sinking ship of state

Posted by: Illini | September 21, 2010 10:31 PM | Report abuse

Leadership Vacuum at the White House


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Posted by: FormerDemocrat | September 21, 2010 10:33 PM | Report abuse

"With Orszag, Summers and Romer gone, the administration is without three of its strongest voices -- at the exact moment that the recovery seems to be slowing."
==========================================

The recovery is slowing? We were in ar ecovery? I am worried if this is what democrats felt a recovery was supposed to look like. If so, we are all in BIG trouble!

Posted by: sanmateo1850 | September 21, 2010 10:33 PM | Report abuse

What power vacuum? Looks to me like the Treasury Secretary is getting what he wants, and has the political savvy to avoid the problems Summers created. It is all gravy from here anyway, since the recession ended in June 2009 and there is nothing but rosy sunrises ahead.

Posted by: edwardallen54 | September 21, 2010 10:37 PM | Report abuse


The smarter rats are leaving before the Dims get slaughtered at the polls 41 days from now. The ones who hang onto Barry longer than that become damaged goods.

Posted by: screwjob21 | September 21, 2010 10:45 PM | Report abuse

At this critical moment in the putative economic recovery, the White House wants to play gender politics? This is exactly what everybody most feared about these bozos.

Posted by: Rob_ | September 21, 2010 10:49 PM | Report abuse

Might I be so bold as to suggest some criteria, numbered, so it is clear which are most important:

1. Thought leadership in economics and finance, macro and micro, spanning both the private and public sectors.
2. Earned confidence among serious heavyweights and opinion leaders in the economic sector.
3. Not strongly affiliated with either of the two leading parties.
4. Commitment to stay the course through the remaining time Obama is president including the next term if he wins one.
:
:
:
9,246. Gender.

Please, Mr. President, for the sake of our children and theirs, and for those relying on, or hoping to earn, income from working at a business enterprise .... please do not apply this list from the least important criteria up.

Posted by: TerryOtt | September 21, 2010 11:13 PM | Report abuse

This is a big chance for the WH to get right on economic issues.

Will Obama fight the powers that be, or let them continue to run his show? Rumors that he wants a female CEO is very disappointing. Very.

Krugman would drive R's crazy (which is a plus), but Stiglitz or someone that actually understand the economy would be a big improvement.

Picking someone who knows how to sell widgets, dodge taxes and circumvent regs is not equal to picking someone who understands macro economic issues. God help us!!!

Posted by: rat-raceparent | September 22, 2010 12:24 AM | Report abuse

Isn't McKinsey where some of the Enron brains were from?

Posted by: ronjaboy | September 22, 2010 6:24 AM | Report abuse

Just rats abandoning a sinking ship!

And, of course, the Obama administration has its priorities right re a replacement - must be female to address the gender imbalance!

Posted by: jfgerald | September 22, 2010 7:02 AM | Report abuse

It will be interesting to see if Pres. Obama capitalizes on this opportunity to recast his economic team and policies. Will it be more of the same or has he learned from the mistakes?

Posted by: tuber | September 22, 2010 7:02 AM | Report abuse

To the Marine guards at the White House: Feel free to let the door hit Summers in the arse on his way out.

Posted by: Byrd3 | September 22, 2010 8:26 AM | Report abuse

The rats are fleeing the sinking S.S. Oblather.

Posted by: illogicbuster | September 22, 2010 8:29 AM | Report abuse

I'll take the job.

Posted by: kurttj2002 | September 22, 2010 10:37 AM | Report abuse

The goal of replacing Summers with a woman is beyond disgraceful. It's just the triumph of spin over everything else. What a disgusting lack of seriousness. Here's a list of possible women replacements:
Obama's aunt
Susan Sarandon
Janet Napolitano
Janet Reno
Ruth Chris

Posted by: truck1 | September 22, 2010 10:34 PM | Report abuse

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