The two-horse race to replace Ben Bernanke as the Fed chairman appears to have come down to gender. In a letter to the president, about a third of Senate Democrats have made clear they would like Bernanke’s deputy Janet Yellen to replace him, primarily — though they do not openly say it — because she is a woman.
The White House, it seems, would prefer Larry Summers, Bill Clinton’s Treasury Secretary who was also director of Barack Obama’s National Economic Council. Summers is a distinguished economist, a former chief economist of the World Bank and briefly, until he was subsumed by controversy, president of Harvard University. (Summers writes a monthly column for Reuters.)
It is true there are not enough women in top positions. It is true, too, that Janet Yellen is a distinguished economist with considerable reserve bank experience. But her gender should not in itself be enough qualification for her to be awarded with one of the most important jobs in the nation.
The Fed chairmanship has always been a powerful position, but when there is gridlock in government thanks to the Republican majority in the House deciding to pass no new measures whatever — Speaker Boehner defines his job as repealer-in-chief, not legislator-in-chief — the Federal Reserve is the sole provider of economic policy. For that pivotal post we need the best person for the job.
There is a strong case for giving the job to Summers. He is not only a distinguished theoretical economist but an original thinker at a time when what we need above all is ingenuity. He is hard to pigeonhole. He has firm views and is headstrong, which should commend him to those who believe the Fed has become obedient to the executive branch. Although a lifelong Democrat, Summers rarely follows the party line.