Skip to main content
Part of complete coverage from

A horrible way to fill the second most powerful job in America

By David Gergen, CNN Senior Political Analyst
updated 5:29 PM EDT, Tue September 17, 2013
STORY HIGHLIGHTS
  • Larry Summers has dropped out of contention to head the Federal Reserve
  • David Gergen: Process of filling the crucially important job has been shameful
  • He says Summers' reputation has been trashed and his merits ignored
  • Gergen: President Obama should now nominate Janet Yellen for the post

Editor's note: David Gergen is a senior political analyst for CNN and has been an adviser to four presidents. A graduate of Harvard Law School, he is a professor of public service and director of the Center for Public Leadership at Harvard University's Kennedy School of Government. Follow him on Twitter.

(CNN) -- Before the story sinks beneath the waves, a few more words are in order about the recent selection process for a new chief for the Federal Reserve: It stinks.

The chairmanship of the Federal Reserve Bank is probably the second most powerful job in the United States. In combating the financial crisis and the slow recovery, it has often been more important than the presidency. Indeed, many in other countries believe it has become the most important job in the world.

Selecting a chairperson is thus a solemn, crucial undertaking. I have only participated once -- during the process when President Reagan decided to reappoint someone first named by his Democratic predecessor, President Carter. Reagan thought long and hard and, putting aside all partisanship, wisely asked Paul Volcker to stay on. Everyone at the White House and in Congress understood how big that decision was.

David Gergen
David Gergen

We once chose our Supreme Court nominees with the same degree of deliberation and thoughtfulness on both sides of the aisle. That is, until the debacle of the Bork nomination in 1987, when the process disintegrated into a partisan brawl. Nominations of justices have been subject to undue political considerations ever since.

One can only hope that the selection process for a Fed chair in recent weeks is no precedent for the future. It has been messy, ugly and degrading to the leading candidates and could ultimately diminish the authority of the Federal Reserve itself.

I have had the privilege of counting Larry Summers as a colleague and then a friend for more than 30 years; I have known and respected Janet Yellen for more than a decade and during college was a friend of her husband, George Akerlof, a Nobel Prize winner in economics.

Both Summers and Yellen are superbly qualified to lead the Fed. But both were also distinctly uncomfortable with the way the process played out as a political circus, so that whoever won would carry baggage into the job. These are serious people in serious times. They -- and we -- deserve better.

To read what was being said about Larry Summers might lead you to believe that he is a Wall Street-loving, Main Street-hating misogynist who chews up colleagues for breakfast. That caricature is wildly unfair.

Without rehashing the debate -- and because I am no economist -- let me just suggest a different way to look at him. First and foremost, the past two Democratic presidents, Bill Clinton and Barack Obama, selected Larry Summers as a principal architect of U.S. economic policy and in both cases were extremely grateful for his leadership.

It has been messy, ugly and degrading to the leading candidates.
David Gergen

CNN Money: Economists react as Summers drops out

For Clinton, Summers and Bob Rubin were mainstays in an administration when there was an explosion in jobs and the income of the bottom 20 percent actually rose faster than the top quintile.

For Obama, Summers and Tim Geithner -- along with Ben Bernanke -- were the most important players in staving off a depression and helping the economy back on a growth path, albeit slow.

In both administrations and in days since, Summers has consistently spoken in favor of closing the opportunity gaps in the country; that issue goes deep with him.

Summers does believe in the power of the marketplace and he respects the U.S. financial industry as one of the nation's prize assets, a creator of growth and jobs. But he also believes in regulation.

As columnist Ed Luce pointed out in the Financial Times on Monday, he wanted to be tougher on banks than many of his colleagues early in the Obama years. The liberal Democrats who have chased him with pitchforks over repeal of Glass-Steagall in 1999 conveniently forget that it passed the House by 362--57 with Democrats voting in favor by 3-1. Nor do they take any responsibility for doing anything to correct it in the eight years between passage and the economic crisis. Nor do they admit that it had precious little to do with causing the crash.

Larry Summers is by no means perfect, but in the din of recent weeks, it has been hard to keep things in perspective. Yes, he was very clumsy in his comments about female scientists while at Harvard -- but he clearly did not mean to say that women are somehow inferior and he apologized repeatedly for his clumsiness. Who would have known from the past few weeks how many women like Sheryl Sandberg have worked for him and are fierce champions for him?

Yes, he can be difficult in interpersonal conversations. He is tough minded and likes to joust intellectually. But is that a disqualification for strong leadership of a major organization? If so, we would never have heard of Steve Jobs or Jack Welch.

One could go on but the point should be clear: This was a terrible process in which injustices have been done. The president and his White House staff obviously bear part of the blame. So do those who have rushed to the barricades, turning out press releases and petitions.

The only way it could get worse is for the president, as suggested by the press, to turn away suddenly from Janet Yellen out of annoyance with liberal Democrats or because he feels he has been boxed in. This is a decision that must be made strictly on the merits. Larry Summers had the grace to make the right decision. Now the president must make the right decision in choosing Janet Yellen.

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of David Gergen.

ADVERTISEMENT
Part of complete coverage on
updated 4:47 PM EDT, Fri April 18, 2014
Jim Bell says NASA's latest discovery support the notion that habitable worlds are probably common in the galaxy.
updated 2:17 PM EDT, Fri April 18, 2014
Jay Parini says even the Gospels skip the actual Resurrection and are sketchy on the appearances that followed.
updated 1:52 PM EDT, Fri April 18, 2014
Graham Allison says if an unchecked and emboldened Russia foments conflict in a nation like Latvia, a NATO member, the West would have to defend it.
updated 9:11 AM EDT, Fri April 18, 2014
John Sutter: Bad news, guys -- the pangolin we adopted is missing.
updated 1:10 PM EDT, Sat April 19, 2014
Ben Wildavsky says we need a better way to determine whether colleges are turning out graduates with superior education and abilities.
updated 6:26 AM EDT, Fri April 18, 2014
Charles Maclin, program manager working on the search and recovery of Malaysia Flight 370, explains how it works.
updated 8:50 AM EDT, Fri April 18, 2014
Jill Koyama says Michael Bloomberg is right to tackle gun violence, but we need to go beyond piecemeal state legislation.
updated 2:45 PM EDT, Thu April 17, 2014
Michael Bloomberg and Shannon Watts say Americans are ready for sensible gun laws, but politicians are cowed by the NRA. Everytown for Gun Safety will prove the NRA is not that powerful.
updated 9:28 AM EDT, Thu April 17, 2014
Ruben Navarrette says Steve Israel is right: Some Republicans encourage anti-Latino prejudice. But that kind of bias is not limited to the GOP.
updated 7:23 PM EDT, Wed April 16, 2014
Peggy Drexler counts the ways Phyllis Schlafly's argument that lower pay for women helps them nab a husband is ridiculous.
updated 12:42 PM EDT, Wed April 16, 2014
Rick McGahey says Rep. Paul Ryan is signaling his presidential ambitions by appealing to hard core Republican values
updated 11:39 AM EDT, Wed April 16, 2014
Paul Saffo says current Google Glasses are doomed to become eBay collectibles, but they are only the leading edge of a surge in wearable tech that will change our lives
updated 2:49 PM EDT, Tue April 15, 2014
Kathleen Blee says the KKK and white power or neo-Nazi groups give haters the purpose and urgency to use violence.
updated 7:56 AM EDT, Wed April 16, 2014
Sen. Sheldon Whitehouse and Rep. Henry Waxman say read deep, and you'll see the federal Keystone pipeline report spells out the pipeline is bad news
updated 7:53 AM EDT, Wed April 16, 2014
Frida Ghitis says President Obama needs to stop making empty threats against Russia and consider other options
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT