After a three week skid of the stock market following his election, President-elect Barack Obama rolled out his economic team. As expected, New York Federal Reserve President Tim Geithner was named as Treasury secretary and former Clinton Treasury chief Lawrence Summers was named to head the President’s National Economic Council. Melody Barnes was named to the Domestic Policy Council spot and Christina Romer was appointed to head the Council of Economic Advisors. (New Mexico Governor and former U.N. Ambassador and Energy Secretary Bill Richardson is rumored to be up for commerce secretary and will be officially named later.)
Geithner has been front and center in the current economic crisis, advocating greater government involvement but also weighing in against a plan to rescue Lehman Brothers, whose demise many credit for a severe worsening of the financial collapse. He will insure a smooth transition from the current administration in oversight of the widely-flung government rescue efforts. However, he does not offer any significant background in trade or tax policy.
Summers is equally well-schooled in crisis management, having worked to overcome concerns of his former boss, Treasury Secretary Robert Rubin, and devise a rescue plan for the Asian financial crisis in the 1990s. He has consistently advocated big, bold, and expensive government stimulus efforts.
His selection won’t be universally hailed. Women’s groups were infuriated when, as president of Harvard, he posited that gender differences might play a part in the number of women in the science professions. (He was later forced out of his post but remains the the Charles W. Eliot University Professor.) Liberals are not pleased with some aspects of his economic track record either. CNN reported:
Summers’ critics contend he played a role in the current financial crisis. They cite, among other things, his support for the Commodity Futures Modernization Act, which allowed many derivatives – like the credit default swaps that have rocked markets this fall — to go unregulated.
Nevertheless, whatever baggage he brings won’t weigh him down significantly. His position is not subject to Senate confirmation — which explains perhaps why he was placed in this role rather than Treasury.