Larry Summers, who was a former economic advisor to President Obama and a Secretary of the Treasury in the Clinton administration, has taken his name out of consideration for the Federal Reserve chair. Summers has been criticized for his role in deregulation, which some attribute to causing the financial crisis, and his cozy relationships with Wall Street Banks. After servings as the president of Harvard, Summers served as a part-time managing director of a hedge fund and was compensated for delivering speeches by financial institutions such as Goldman Sachs, JP Morgan, and Lehman Brothers.
On Sunday, Summers sent a letter to President Obama. He said that the reason he was withdrawing his name was because: “I have reluctantly concluded that any possible confirmation process for me would be acrimonious and would not serve the interest of the Federal Reserve, the Administration or, ultimately, the interests of the nation’s ongoing economic recovery.”
At least four Democratic senators had announced their opposition to Summers if he were to be nominated for Fed Chair. Senators Jon Tester, Sherrod Brown, Jeff Merkley, and Elizabeth Warren had expressed opposition to Summers.
In addition to the opposition Summers would face from the Democrats, women’s groups such as the National Organization for Women and UltraViolet were gearing up to oppose Summers and instead support Janet Yellen, an economist from University of California, Berkeley and the Vice Chairwoman of the Board of Governor’s of the Federal Reserve System. While president of Harvard, Summers made a remark that women were not as represented in the sciences was because of some innate differences between men and women. That comment did not go over well with faculty and has often been cited as a reason for the vote of no confidence in his work as president.
President Obama said the following in a statement after Summers withdrew his name, “Larry was a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom, and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today. I will always be grateful to Larry for his tireless work and service on behalf of his country, and I look forward to continuing to seek his guidance and counsel in the future.”
With Summers deciding to withdraw from consideration, a fight between Democrats and the White House is averted. This comes after days of Democratic and GOP opposition to the President’s plan to attack Syria. The plan to attack Syria was canned after it looked like the Congress would not give authorization for such action. The President’s support of Larry Summers shows his willingness to attach himself to an establishment figure who is plainly unpopular with the Democratic base.