Summers: A Rumpled Trouble-Shooter
WASHINGTON (AP) _ Larry Summers, in line to be the next Treasury secretary, has proven an unlikely economic commando during recent global economic crises _ a rumpled, blustering former professor parachuting into financial trouble spots.
Leaving for a whirlwind diplomatic mission through Asia last year, Summers dropped his passport as he made his way to his seat on the plane. Luckily, another passenger returned it.
Despite this occasional lack of polish, Summers, who has served as deputy Treasury secretary since 1995, is credited as one of the chief architects of the Clinton administration’s strategy for dealing with global financial turmoil.
Bruce Steinberg, chief economist for Merrill Lynch, noted Summers’ global trouble-shooting role, saying ``he’s had very intensive on-the-job training.″
Now, President Clinton has picked Summers, 44, to succeed Treasury Secretary Robert Rubin, who announced his resignation Wednesday.
Little change is economic policy is expected.
Top White House economic adviser Gene Sperling said Summers and Rubin ``have really worked as partners for years, both in managing Treasury and developing policy. Many of their views they’ve arrived at together through shared experience.″
Said former Federal Reserve Governor Lyle Gramley: ``I don’t see any reason for thinking policy will change one iota. It is in the international arena where Treasury shines, and that is where Larry has been taking the lead for some time.″
However, House Majority Leader Dick Armey, R-Texas, said Summers will have to answer for the administration’s handling of overseas economic troubles that didn’t go so well, such as International Monetary Fund loans to Russia.
And Rep. Bill Archer, R-Texas, chairman of the House Ways and Means Committee, said Summers faces other ``tough challenges″ in working with Congress on tax cuts, trade and Social Security reform.
There was also speculation that the scholarly Summers might have trouble matching Rubin’s political acumen.
``This is not to take away from the expertise of Larry Summers, but I am glad we have a backup in Stuart Eizenstat,″ the political veteran chosen to Summers’ deputy, said Rep. Charles Rangel, D-N.Y. ``We might compensate for the loss of Bob Rubin with both of them.″
Certainly, Summers’ style couldn’t be more different than Rubin’s.
Rubin, former head of Goldman, Sachs & Co., is suave and slim and wears impeccably tailored suits. The portly Summers, who was a full professor at Harvard University at the tender age of 28, sometimes gives the impression of a preoccupied academic who has trouble keeping his shirttail tucked in.
Rubin appears relaxed and amiable. Summers, who almost always works with an open can of Diet Coke at hand, is intense and seldom smiles. Even in his moment of triumph, he got a catch in his throat as he thanked his family in his remarks at the Rose Garden ceremony in which Clinton announced his nomination.
His blunt self-assurance most of the time rubbed some members of Congress the wrong way. Rep. Mark Foley, R-Fla., recalled that Summers once described Republican efforts to eliminate estate taxes as ``selfish,″ raising concerns about his ability to avoid making ``ill-tempered, partisan remarks.″
Still, even Summers’ critics concede the acuity of his analysis _ his ability to ``think outside the box″ and ``add value″ to deliberations on almost any topic.
Summers grew up outside Philadelphia and hails from a family of distinguished economists. At Harvard, he was known for research into practical economic questions such as tax policy, joblessness and the stock market. In 1991, he left academia to become chief economist at the World Bank.
Summers rise in Washington, however, was slowed by an internal World Bank memo he signed that was leaked to the news media in 1992. ``The economic logic behind dumping a load of toxic waste in the lowest-wage country is impeccable,″ it read, in part.
Summers issued a public apology. He explained that the memo was written by an economist working for him, and that he co-signed it thinking to stimulate internal debate even though he disagreed with its premise.
Still, Summers, who worked on Clinton’s transition team, was passed over to be chairman of the newly elected president’s Council of Economic Advisers. He took the job of Treasury undersecretary for international affairs instead, after facing questions about the World Bank memo during his Senate confirmation hearing in 1993.
``When I make a mistake, it’s a big one,″ Summers told senators at the hearing.