Filed under: News, Politics, President Obama
President Barack Obama's economic advisor, the sometimes controversial Lawrence Summers, is leaving his post as director of the National Economic Council to return to Harvard University.
The move, which White House officials say was planned, also comes as Obama appeals to voters to give congressional Democrats more time to improve the economy as mid-term elections approach and the economy continues to lag.
The AP writes:
Though administration officials said Obama had known for some time that Summers would depart this year, news of his pending exit comes amid deep concern over the sluggish pace of the recovery, as well as criticism of the team that conceived the administration's economic policies.
Summers was the chief architect of many of those policies, playing a central role in the massive economic stimulus and the government bailout of the auto industry. He also was an advocate for the financial regulatory legislation Obama signed into law earlier this year. But with those issues behind him and the end of his two-year leave from Harvard looming, a senior administration official said Summers felt it was the right time to go.
Summers served as Treasury Secretary under former President Bill Clinton. He was one of the youngest professors to receive tenure at Harvard and eventually rose to the university's president. As president, he attributed the small number of women involved in the fields of math and science to gender differences. Summers resigned as Harvard's president in 2006.Despite his dubious arguments regarding women, Obama said the country was better off because of Summers' policy suggestions during a time of "great peril for our country."
"While we have much work ahead to repair the damage done by the recession, we are on a better path thanks in no small measure to Larry's wise counsel," Obama said.
It does appear that the economic stimulus and government bailout of the auto industry have helped pull the country back from the verge of complete economic collapse. An implosion of the U.S. economy would have likely taken the rest of the world economy with us.
By most accounts, the auto bailout was a success. Business Week writes:
So far, it is tough to argue that the bailout hasn't worked. GM is in the black, having reported an $865 million profit in the first quarter with black ink looking likely for the rest of the year. GM's results are strong enough that the company is preparing for an initial public offering that should start selling stock in November. Chrysler is at least making an operating profit, which puts the company in much better shape than most analysts thought it would be a year ago. With much lower costs, both companies should be able to make money going forward.
There's also positive news about the $787-billion economic stimulus. The White House estimates that there are 1.5- to- 2-million more jobs in the economy because of the stimulus:
"Fiscal stimulus has the biggest impact on growth rates when it's first ramping up," said Christina Romer, (pictured above with Obama and Summers) chairwoman of the Council of Economic Advisers.
David Leonhardt of The New York Times reported that the outlook for jobs because of the stimulus is even better. He writes:
Just look at the outside evaluations of the stimulus. Perhaps the best-known economic research firms are IHS Global Insight, Macroeconomic Advisers and Moody'sEconomy.com. They all estimate that the bill has added 1.6 million to 1.8 million jobs so far and that its ultimate impact will be roughly 2.5 million jobs. The Congressional Budget Office, an independent agency, considers these estimates to be conservative.
Summers and Obama also deserve credit for the financial-regulation bill, the most sweeping overhaul of Wall Street since the Great Depression. In addition to regulating the crazy risks that some Wall Street banks were taking that lead to the financial collapse, the bill also created a consumer financial protection.
Listening to Republican rhetoric on the economy, you might think all of Obama's and Summer's efforts were miserable failures.
So, politics aside, Summers should receive credit for the work he did on behalf of Americans as he heads back to Harvard.