I mean, I guess it’s a little hard for one’s support base and one’s ego to come back from this:
Ouch. For context, the National Journal is pretty widely read in Washington (“on every congressman’s desk” is a phrase being thrown around, for example), so, assuming that politicians can read, this helped set the stage for somewhat of a battle to get Larry Summers confirmed even if Obama were to choose him as the next Federal Reserve chair. (You can read the full text of the article here. I don’t really disagree with much of it, but…ouch.) For this to come on the heels of an open letter supporting Janet Yellen signed by some 350 economists (including yours truly)…just, really, ouch. (Also, if I were Yellen right now, I’m not sure whether I would be doing a happy dance or worrying the level of potential insult has been raised.)
As one whose brain chemistry can’t help but root for the underdog, I was actually a little disappointed to learn that Summers withdrew his name from consideration for the job. (In fairness, I never thought he would be the world’s worst Fed chair, just not the best.) In his letter to President Obama, which for some reason is publicly available on the Internet, Summers states that he is withdrawing from the race because an “acrimonious” confirmation process wouldn’t be good for anyone.
BUT…before you go feeling too bad for Summers (or giving him a cookie for taking the high road), there’s another piece of the puzzle to consider. Summers put himself in somewhat of a sticky situation by recently acting as a (presumably very well paid) consultant to Citigroup, which, as per ethics rules implemented by the Obama administration, would prevent Summers from working on matters related to the large bank for a period of two years. Last time I checked, having a Fed chair who was allowed to regulate banks was kind of important, so I’m not really sure what Summers was thinking- he’s not a total idiot, and he most likely doesn’t need the cash, so I can’t tell whether Summers really wasn’t expecting to be in the running for another Obama appointment or whether he thought that the rules wouldn’t apply to him. In any case, I’m kind of disappointed that his withdrawal letter didn’t cite a desire to spend more time with his money.