Everyone speculating on President-Elect Obama’s most likely choice for Secretary of the Treasury has the same two names: Larry Summers and Tim Geithner. I have known them for a long time, and worked with both in the Clinton Administration. Either one would be excellent. Geithner is now way ahead in the Intrade odds: 45% to 27% as of November 14. But my bet is that Obama will go with Summers. For one thing, Geithner is needed at the New York Fed, where he has been one of the key players managing the financial crisis.
Most sensationally, Summers is said to be tainted by his time as President of Harvard. Too much has already been said about this. But I will make just a couple of observations. First, although Summers may not be Mr. Personality, and he will never be elected to high office nor chosen to head offices for women’s rights or the environment, he has all the most important qualities for the Treasury job. Despite a tendency to say what he thinks, I don’t think he committed any true faux pas or became involved in any mini-scandals during 8 years in the government — no easy feat. (The closest he came to a faux pas, or what counts for one in the media, was a statement that the argument for abolishing the estate tax was based on greed rather than efficiency — a statement that he quickly retracted without bothering to try to explain what he had meant, having already by then become familiar with the rules of political brouhahas.) In his time in Washington, he learned how to get along with politicians across the spectrum, from socialists to the far right. It’s true that he wasn’t able subsequently to get along with the full range of faculty in the Harvard English Department, but that is a tougher task. Finally, I continue to be surprised at how the press describes Summers’ ill-fated and ill-considered (but “off the record”) remarks regarding explanations for the lack of women in academic science departments. He is most often reported as having suggested that women generally have less aptitude for science than men. I link to the text of his remarks here, and urge readers to make up their minds for themselves. But I don’t read his speculation about the various hypotheses quite the way most people have assumed. To me the outrageous line in the remarks was, rather, the suggestion “that no economist who had gone to work at the President’s Council of Economic Advisers for two years had done highly important academic work after they returned” !
Originally published at Jeffrey Frankel’s weblog and reproduced here with the author’s permission.