Beware, this gets complicated and outrageous...
An account of how Lawrence Summers enriched himself handsomely before coming to the White House was not exactly new news. But when Frank Rich dug it up and repeated the details last Sunday in the New York Times (4/12), it packed quite a wallop. I just wonder how many websites, television newscasts, cable motor mouths and, heaven forbid, other newspapers, considered it newsworthy enough to report? To be negligible, I'll bet the answer would be few indeed.
Rich said Summers earned $5.2 million in 2008 from a hedge fund, D.E. Shaw, for a one-day-a-week job and another $2.7 million in speaking fees from Citigroup and Goldman Sachs that may be dismissed as business as usual because he was not on the government payroll at the time.
Furthermore, Rich reminded us of an earlier report by Louise Story. She said Summers was on the payroll of another hedge fund, Taconic Capital Advisors while holding down his day job as president of Harvard. Moreover, once in the White House, he tried but failed to put the co-founder of Taconic in the delicate position of supervising TARP bailouts which is the cash used to relieve the pressure on owners of faulty loans.
Isn't it fair to ask about the qualifications of those who vetted Summers for the job as President Obama's chief economic advisor? Moreover, why didn't Summers himself consider that his outside and oversized connections created such an impression of a conflict of interest that he should have voluntarily withdrawn his nomination? Didn't he ever discuss business ethics when he was in the Harvard classroom before he became president?
It really is troubling to raise such a question from a man who once was Bill Clinton's Secretary of the Treasury and if only briefly, held the most lucrative job in all of academia but now sits at Obama's elbow. Here is an excerpt of his biography upon accepting Clinton's nomination:
Lawrence H. Summers was sworn in as the 71st Secretary of the Treasury in July 1999 after serving as Under Secretary for International Affairs and Deputy Secretary of the Treasury. From 1991 to 1993 he served as Chief Economist of the World Bank, where he played a key role in designing strategies to assist developing countries. Before coming to Washington, Summers had a distinguished academic career as the Nathaniel Ropes Professor of Political Economy at Harvard University.
What is incomprehensible is that Summers may be an economic genius, but he seems to have the sensitivity of a 300 lb. gorilla. He is a man who knows a lot about developing countries and probably has countless stories of how the United States has lectured them year in and year out for their corrupt practices. Now while the hair-splitters will no doubt argue that Summers' conflicts of interest do not fit the normal meaning of corruption, they smell nevertheless and would get little sympathy from thousands of hard-working Americans who have lost their jobs and homes in these economic hard times; people who might ask reasonably how could a guy that rich understand the miseries we're experiencing?
Appearances count for everything in politics, especially in Washington, and they remind me of how President Eisenhower dealt with Sherman Adams, his White House Chief of Staff in 1953, for accepting a vicuna coat as a gift from a Republican businessman. It wasn't much of a coat to begin with, but Ike fired him nonetheless. Summers may not have taken any gifts, just lots of money from firms that were buying his brains and legitimacy when they hired him as a consultant. But the most sensitive thing he can do now is to walk out of the Oval Office and never look back.