Watch out for the quiet ones: Bernanke 1, Summers 0

August 25, 2009

Watch out for the quiet ones in the War of the Wonks (OK so we’re being a bit dramatic).

Mild-mannered Ben Bernanke gets to keep his five-star financial job as Federal Reserve Chairman, winning out over speculation that President Barack Obama was thinking about replacing him with Larry Summers, known among other things for his outsized ego.

Delving into the past of the grey-beard, here are some clues about what propelled him to become the nation’s economic engineer — a job he managed to hold on to despite a national unemployment rate approaching 10 percent.

Bernanke was a bit of a rebel as a child, evading work at the family drug store on Main Street in Dillon, South Carolina, to read comic books, as he revealed when accepting the “Order of the Palmetto” from his hometown.

He took risks as a young adult, leaving the known of  South Carolina for the unknown of  Harvard where he recounts, “I took in the scene, so foreign to my experience, and I said to myself, ‘What have I done?'”

Whatever he was doing, it worked. He ended up teaching economics at Princeton. And he’s been recognized for his industriousness with a bit of Interstate highway named after him.

He’s very interested in the international — we hear he likes British fiction like authors Anthony Trollope and PG Wodehouse. And the domestic — he’s a big fan of baseball.

Bernanke also drinks Diet Dr Pepper and Diet Coke (we’re not quite sure of the meaning of that, but hey it is the Fed we’re talkin’ about).

Put it all together and voila! It produces a Fed Chairman.


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Pay attention to B.B. He will be the Fed Chairman who presides over the 2nd great depression of 2010, courtesty of all those failed bailouts, stimulus, and monetizations.

Posted by Fon Lin | Report as abusive

It’s interesting, I think, that Obama continues to fail to learn from his mistakes or to gain deeper insight into the challenges he confronts.

Interesting, and deeply disappointing for all save his opponents.

Bernanke’s judgement has been dubious at best, a marriage of conventional insights with conventional responses writ large under the rubric of crisis management, and it has sowed, in company with Paulson, then Summers, and the rest of the political-financial establishment a catastrophic economic future in order to save the interests of the few in the name of the interests of the many.

It will likely fail, of course, an observation that is widely shared but the thought of which is, for the moment, put aside.

Summers is, to my mind, the representation of Obama’s failures in the economic sphere. If his self-infatuation were coupled with sound judgement one would feel very differently. His track record, however, is abysmal, and his rise to prominence is reflective of the Rubenesque mindset responsible for so much of the nation’s and the world’s economic woes.

That Obama would select Summers, coupled with Bernanke, and fail to perceive the sounder council offered by the likes of Volcker, Bair, Hoenig, et alia is reflective of his own failures of judgement and leadership, his essential orthodoxy and mediocrity of thought and insight.

There are myths that at times of great crisis great leaders appear, and rise to the challenge.

Then again, there is reality . . .

Posted by The Atomik Weasel’s Dog, Fred | Report as abusive

An astute figure who has shown he is a safe pair of hands in times of crisis. The President has placed his confidence in him by giving him the opportunity to lead the Federal Reserve once again. Stable continuity is the name of the game especially as the shoots of recovery are in evidence. In these critical financial times, proven experience and prudence pay rich dividends. Getting America on the financial rails is imperative.

Posted by Pancha Chandra | Report as abusive

Any fan of Trollope is a friend of mine. Don’t know much about his financial decisions, but his literary taste is impeccable.

Posted by Kilian Metcalf | Report as abusive