As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Friday, November 14, 2008

Summers' Balloon Bursting?

One thing I noticed during the primaries was that Obama was always willing to listen to criticism before charting a course. He may not have always changed that course, but he often did. That may be the case with the choice of Larry Summers as the Treasury Secretary.

Intense backlash from women’s groups may have pushed former Clinton Treasury Secretary Larry Summers off the short-list to lead Treasury for President-elect Barack Obama, according to widespread reports circulating in Democratic circles.

The women’s opposition to a possible Summers’ appointment was the explanation some Democratic sources are hearing for why the Obama transition team has crossed Summers off their list. The Obama team doesn’t want to kick off its administration with a controversy nor go head-to-head with an important constituency when there are other qualified candidates, political operatives speculate.

Reports that Summers is no longer in the running are widespread, but not everyone agrees that his problems with women have sealed his fate.

I don't think this is just about those comments about women and math, although it seemed insane for "No Drama Obama" to immediately cause a controversy with his first cabinet selection. The cable nets and talk radio would have had a field day with it.

But I think the intense reaction by liberals against bringing back the guy who ushered in a lot of deregulation in the 1990s had at least something to do with it.

So far, our petition has around 6000 names on it, and several Facebook groups have emerged to protest his possible selection. Women's groups have released a list of names for good candidates.

For Treasury secretary, Gandy said she suggested Federal Deposit Insurance Corp. Chairwoman Shelia Bair; Alice Rivlin, the first director of the Congressional Budget Office and expert on urban issues as well as fiscal, monetary and social policy; former Commodity Futures Trading Commission chairwoman Brooksley Born, who tried to regulate credit default swaps but was blocked by Summers, former Clinton Treasury Secretary Robert Rubin and former Fed Chairman Alan Greenspan.

The name that pops out is Sheila Bair. She happens to be a Republican, but she's a regulator, which seems right for the historical moment. She has support among progressive economists, and she has released one of the better plans for dealing with the mortgage crisis, by using a portion of the bailout money to allow homeowners to restructure their payments. She was pretty good on NPR on this today, in the face of Steve Inskeep going on and on about those luckie duckie homeowners who would be bailed out when their neighbors get stuck with the bill. It's the common way that the forces of the status quo have been arguing against rescue for those facing foreclosure, by pitting homeowners against one another while the bankers take the lion's share of the cash. Bair had an excellent response.

While the program may help some people who knowingly took out mortgages they couldn't afford, Bair says, "Why take a punitive step of forcing them into foreclosure? You're going to have another empty house sitting on the neighborhood for over a year. Who does that help? I don't think that helps anyone."

As for the people who were careful not to get in over their heads and would have to watch while their neighbors get help with their payments, Bair says, "I think that I would say to those neighbors … I want my neighbor's mortgage fixed because, yes, I do have some compassion for that person, but I also realize that it's in my economic self-interest to get this situation stabilized. This relentless procession of foreclosures is creating havoc with our housing market and we need to get it stabilized."

That is exactly correct, and exactly the attitude we need in the next Treasury Secretary. And I have to admit that it would be excellent to have a woman in this position, particularly in the male-dominated world of high finance.

By the way, as Digby noted, these trial balloons are very common in politics, and in this case, it appears that the system may be working. A name is thrown out, the reaction is noted, and the information taken into account. It's not only the norm for politics, it's the norm for the OBAMA CAMPAIGN when it comes to appointments like this. I certainly remember the leaks that Tim Kaine was going to be VP, then Evan Bayh, and then Joe Biden. So I'm glad people are weighing in on these options.

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