Monday, September 16, 2013

Summers at the Fed: A Final Note

I suppose there is nothing staler than yesterday's Fed nominee, but I somehow feel constrained to add a followup to the superplus excess of stories about the virtues and defects of Larry Summers—and an invidious comparison to the present Fed chair, Ben Bernanke.

Here's the thing: the one thing everybody seems to agree on re Summers, friend and foe alike: he's b-r-r-r-illiant, with the particular capacity for coming into a room and just blowing everybody away with his success at mastering his brief (counting “foes,” I exclude people like Rick Perry who simply do not give a damn what they say).

I have no basis on which to quarrel with b-r-r-r-illiant, and I actually liked the little bits of authentic Summers scholarship that I've run across (I even liked the one about exporting pollution costs). But could it to be that Summers' ultimate purpose in life is to blow people away, and that he cares far less about what he says—or even what he achieves—than he does about his success in leaving people gobsmacked by his knack for saying it?

Which brings us to Bernanke. I'm not going to venture a judgment on whether Bernanke is as brilliant as Summers (though I bet Summers would). But the personal traits use to identify him seem almost the opposite of Summers': his modesty, his courtesy, his disposition not to make himself the center of attention. Sometimes in the work of journalists, this can come close to Stockholm syndrome: the reporters who know him best seem almost constrained to write about how the world at large just doesn't understand what a good job Bernanke is doing.

Actually, I'd agree that he has done a good job: probably as good a job as anybody could have been in these perilous times. But he's made his blunders (Not Seeing it Coming certainly counts for a lot).  If he is a success, he is at best a success on balance--but that may be the best we have any right to expect.  At any rate, my immediate point is that insofar as he has accomplished anything, those traits of personal character have a lot to do with it—that it's more than merely cosmetic, that the very qualities that win the hearts of reporters are qualities that make him so effective in his job. If nothing else, the very idea of a Fed chief who is not Full of Himself, must alone be enough to leave his adversaries wrong-footed. Now, is there any other candidate with that sort of personality?


The New York Crank said...

"Brilliant?" Mr. Deregulation himself? "Brilliant?!"

This is the man who favored doing away with Glass-Steagall. The man who favored deregulating derivatives.

That kind of foresight, not to mention his social intelligence, including his personal charm, especially around women, make "brilliant" one of the most undeserved adjectives ever applied to Larry Summers.

Very crankily yours,
The New York Crank

marcel said...

NY Crank: There is a big difference between brilliance, on the one hand, and good judgment and wisdom on the other. Of all the people who are in awe concerning Summers' brilliance, I doubt that any would be so with respect to these other traits. A healthy respect for the unknown unknowns is common among the wise and, IMH experience, far less so among the brilliant. Similarly (IMHE), recognition of the need for regulation is rare among brilliant economists less so among the wise ones.

In your listing of deregulation, Glass-Steagall, derivatives and oblique reference to Summers' public statements, I think What you are complaining about concerns Summers' lack of wisdom (& GJ) not any lack of brilliance.

The New York Crank said...


So if brilliance doesn't lead to wisdom, what is it for — gathering data and interpreting it in toxic ways?

If that's brilliance, then Larry's brilliant.

Otherwise he's simply a boor.

Very Crankily Yours,
The New York Crannk

Buce said...

Ah, but I never said he was brilliant. Merely b-r-r-r-illiant, which is quite a different matter. Afterthought, this analysis may help to explain why Keynes struck out so completely at Bretton Woods. Just sayin.'

marcel said...

NYC: Brilliance has its uses. It can lead to insights that others miss: e.g., relativity, quantum mechanics, natural selection, Godel's theorem, the periodic table, Arrow-Debreu general equilibrium ... (note that many but not all of these examples are mathematical). Knowing when each of these things is an appropriate and useful tool of analysis requires something other than brilliance, as does understanding the limitations of each.

Think of brilliance (alone) as being something of the same species as idiot-savantry.

CrocodileChuck said...

B-b-b-b-brilliant? Larry Summers????????

'Well done is better than well said' Ben Franklin

The New York Crank said...

So tell me, Marcel, specifically what nugget of insightful brilliance did Larry Summers drop?

And how would this qualify him for any public office on which the well being of Americans or our economy depends? Eh?

Very crankily yours
(and growing increasingly cranky)
The New York Crank

marcel said...

The NYC: 1) I've never dealt with him up close and personal, but both by reputation and by the account of some whom I know, it is common for him to cut through the analytic fog that so often bedevils economists' reasoning and to do that more rapidly than anyone else in the room.
2) Notice that I used the modifier can in my last post, without attributing any specific piece of insightful brilliance to the man.