Why Make a Statement? Summers Withdraws from Consideration as Fed Chairman
Since a meeting between congressional Democrats and President Obama in late July, it’s been apparent that there were three nominees for Chairman of the Federal Reserve: vice chairwoman Janet Yellen, former vice chairman Donald Kohn, and former Treasury Secretary Lawrence Summers. At the time, I expressed my opposition to Lawrence Summers and support for Janet Yellen. After Mr. Summers and the White House surveyed sentiment in the U.S. Senate, it became clear that he would face serious opposition from many Democrats. As a result, Mr. Summers decided to withdraw his name from consideration.
There’s one part of the withdrawal process that doesn’t make sense to me. Why did Mr. Summers have to send a letter to the White House? Is it because he wanted the President to laud him, yet again, for his public service? If that’s what Mr. Summers wanted, the President obliged with a statement thanking his former economic advisor.
It seems to me that the eventual nominee and the institution of the Federal Reserve would have been better served if Mr. Summers had quietly withdrawn his name from consideration. In a due course the President would have made his selection, and the nominee would have appeared as the President’s first choice. At that point, Mr. Summers would have graciously backed the nominee.
Instead, Mr. Summers has used the brief exchange with the President to intimate that, but for politics, he was the best person for the job. In withdrawing his name, Mr. Summers reminded me, yet again, why I thought his nomination would have been bad for the country.