The Summers BubbleIn this context, I would suggest that, if y you have the time, you listen to Amy Goodman's Democracy Now today:
The selection of Larry Summers as treasury secretary would send a message that Wall Street is more powerful in the Obama administration than the progressive coalition that brought him to power.
Kevin Connor and Matthew Skomarovsky, TAP | November 17, 2008The choice of a new treasury secretary presents an early test of President-elect Obama's commitment to change in the realm of economic policy, where the need for a new direction is most painfully evident. Will the new administration find a bold answer to decades of trickle-down economics? Or will Wall Street-affiliated party insiders summon the political muscle to remain relevant and deliver for their friends in finance? A battle for the soul of Obama's White House is underway.
Considering what is at stake, the emergence of Lawrence Summers as a leading candidate for treasury secretary is an alarming indicator that Wall Street Democrats with abysmal records are gaining an upper hand over the broad progressive coalition that lifted Obama to victory.
Summers' candidacy, pushed heavily by Democratic Party rainmaker and Citigroup executive Robert Rubin, is premised on the notion that Summers' expertise and experience is urgently needed in our time of crisis. Whatever his gaffes at Harvard, the argument goes, Summers has a proven capacity to lead the economy in the right direction.
But a sober look at history suggests the opposite; it is precisely Summers' record of service that is his biggest liability. On the critical economic issues he encountered as a Clinton administration official, Summers' expertise translated into consistent advocacy for policies that infected the financial system with deadly risk.
Recently, Summers has tilted toward progressive stances on several questions of economic policy. But when considered against the backdrop of his career, his pontifications are an unconvincing resumé point -- especially when many other economists got it right all along, without the benefits of hindsight.
On three major issues that have had special bearing on the recent crisis -- financial deregulation, asset bubbles, and government bailouts -- Summers flouted basic tenets of his profession, ignored warnings, and pursued a short-sighted strategy. A thorough review of this record undermines Summers' only serious claim to the Treasury: his much-hyped expertise.
I think it is important to consider the question that runs through the whole of this program, and it's not "Who Is Obama?", but "Who Is Obama LISTENING TO?" because he hasn't been in Washington long enough to learn enough of the ropes to pick his advisors without any critical scrutiny. I suspect The Clenis and HRC both regret their early affiliation, fresh from Little Rock, with Dick Morris.
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