It’s almost over, I think. I’m talking about the incessant and over-the-top speculation/lobbying/mud slinging which has incredibly accompanied the choice of a new Fed Chairperson. If you’re still tuned into this here is the final analysis of each candidate by AEI scholars. Don’t worry, they aren’t long. I particularly liked this from James Pethokoukis.
“Boil all that down and the case for Summers really revolves around both Obama and influential Wall Street Democrats being more personally comfortable with Summers…If Summers should somehow be confirmed, he will emerge as a politically weakened Fed chair.”Jim Pethokoukis, “Obama may want Larry Summers at the Fed. But in Heaven’s name, why?
I liked it because it zeroes in on the the real driver behind the decision – money. I suspect that President Obama could care less about this appointment. He knows it won’t have any effect on his legacy and no Fed chairperson is going to advance his political agenda in the next few years. On the other hand, those “influential Wall Street Democrats” are needed to pony up a lot of money for next year’s elections, so keeping them happy is worth the grousing he’ll get from the Left. He knows that in the final analysis they aren’t going anywhere.
Personally, I wish he would just surprise us all and name some well-respected academic but obscure academic. It is unlikely that the new person is going to have to deal with a crisis like the one we just experienced, and in the unlikely event it should recur the playbook is written. The staff of the Fed, much like the staff in other bureaucracies does most of the work and tends to be the repository of expertise, so that whoever leads the bank is less important than current opinion makes her out to be.