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Larry Summers for Fed Chief… He’s got my vote. Absolutely!
Why? You just have to get to know the guy and you’ll see he’s perfectly qualified to head the Federal Reserve.
Here’s just part of his resume.
From 1982-1983, Larry Summers was on staff at Ronald Reagan’s Council of Economic Advisers. That’s where Lawrence of Enablers earned his “Deregulate Everything” T-shirt.
After his brief stint on the Gipper’s Council, where he was taught how real pros corral free markets for personal profit, the Enabler headed back to Harvard to teach kids (and himself) how to squeeze personal wealth out of mere economic theory.
He got his next shot at stardom as Chief Economist of the World Bank in 1991. He was there until 1993.
While there he wasted no time shining a light on himself.
In a 1991 interview he famously said, “There are no limits to the carrying capacity of the earth that are likely to bind any time in the foreseeable future. There isn’t a risk of an apocalypse due to global warming or anything else. The idea that we should put limits on growth because of some natural limit is a profound error and one that, were it ever to prove influential, would have staggering social costs.”
Who knew that the science of economics, which is more like an art-and in Larry’s case nihilistic art-had branches in meteorology, geophysics and earth science?
Now check out what he did next…
In December 1991, while still green at the World Bank, Larry signed a memo that was rather quickly leaked to the press. The memo had this Larry tidbit in it, “The economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that…. I’ve always thought that under-populated countries in Africa are vastly underpolluted.”
Larry said the musing-memo was intended as sarcasm. His buddy economist Lant Pritchett, whose name was also attached to the memo, said the memo was doctored to remove context and intended irony, and was “a deliberate fraud and forgery to discredit Larry.”
Still, Larry did such a good job of dumping on down-on-their-luck countries that the World Bank is famous for enslaving with their indentured servitude loans that in 1993 he was offered the same kind of job by new President Bill Clinton. He accepted and got the title Undersecretary for International Affairs at Treasury.
In 1998, Larry, along with U.S. Securities and Exchange Commission (SEC) Chairman Arthur Levitt, Fed Chairman Alan Greenspan, and Secretary of the Treasury Robert Rubin, torpedoed an effort to regulate derivatives. There would be none, as in no regulation of the weapons of mass financial destruction whose fuses had already been lit and would in short order explode financial systems into a very black hole.
Apparently Larry’s “Deregulate Everything” T-shirt caught the eye of Clinton’s top Government Sachs employee, Treasury Secretary Robert Rubin. Legend has it that Bobby took Larry under his wing, kind of like a big-brother mentoring thing.
Larry looked up to Rubin. After all, Bob had been with Goldman Sachs for 26 years and was its co-chairman from 1990-1992. Calling Rubin rich would be like calling the Grand Canyon a ditch. Larry liked rich and was determined to get some for himself. Don’t worry he gets it, you’ll see.
So, Bobby says to Larry, “Work with me and Alan Greenspan (who was then the farsighted Mr. Magoo leader of the Federal Reserve) to do away with this pesky Glass-Steagall thing that’s been an albatross around our free market necks, and I’ll take care of you.”
Well, it worked out in everyone’s mutual interest. Alan kept his job for a lot longer. Bob Rubin left the Treasury in 1999 to make $126 million as a consigliore at Citigroup, which formerly had been Citicorp and Traveler’s until they could merge to form Citigroup, coincidentally in 1999, when that Glass Ceiling thing was finally broken. And Larry? He traded in his T-shirt for a “Deregulate Everything” tattoo and got Bob Rubin’s job as the nation’s 71st Secretary of the Treasury.
Too bad for Larry the new gig didn’t last too long. In 2001 some guy named George W. Bush became the new president and sent Larry packing.
So, Larry gets a fat job as President of Harvard, which he keeps from 2001 to June 2006. But Poor Larry, he said a bunch of stupid things (again) about girls not being as smart as boys and that African American Studies department head Cornel West was an embarrassment to Harvard because he made a “rap” album. Later, Larry said “The hip-hop scared him; It’s a stereotypical reaction.” Yeah, he said that.
Alas, Larry’s faculty peeps at Harvard had a vote on him as their fearful of rap leader and voted “no-confidence.” But it wasn’t really the girls-are-stupid thing or that he couldn’t rap thing that got Larry in trouble…
While president of Harvard he drank his own Kool-Aid by getting the school into a $3.52 billion derivatives trade (that derived a lot of money for the bankers on the other side of the trades) that cost the school a cool billion dollars.
Oh well, so what if he took a massive interest-rate gamble and lost? He’s not supposed to know which way interest rates are going. He’s an economist, for heaven’s sake. Can’t you just see Bob Rubin in a corner (office) shaking his head at his not-so-smart pupil?
Don’t feel bad for Larry. It turns out the fellas who took the other side of his Harvard derivatives trades made him rich by paying him richly to speak at their shindigs. And one hedge fund, D.E. Shaw & Co., hired him (for what? his trading abilities?) and paid him $5 million (and other compensation) for a 16-month gig. You scratch my back…
Then in 2009, the new president Obamarama hires Larry to be director of the White House National Economic Council. Then Larry immediately gets into it with another Obamarama economic advisor-the only sane man in the room-former Fed chairman and inflation fighting legend of legends, Paul Volcker.
Oh happy days. You know that Volcker Rule thing, the one that Paul is hated for by the banks because he wants them to cut out their crazy trading ways, well, Larry hates Paul and his crazy rules. He even showed Paul his tattoo, but Paul just shook his head and laid some old-school 1980s original rap on the fool.
There’s more on Larry. A lot more.
But, my work is done here. You get it.
Larry Summers is my choice to be the next Club Fed Chairman. He’s earned it and he’d be good at it.
He’s an economist, don’t you know?
For more on Larry’s qualifications to be Fed chairman, read here.