The Genius Cabinet

[babylonsister]

http://www.slate.com/id/2204597/

The Genius Cabinet
Why the president-elect should surround himself with brilliant—albeit prickly, semi-autistic, and egomaniacal—thinkers.
By Jacob Weisberg
Posted Saturday, Nov. 15, 2008, at 7:43 AM ET


Illustration by Rob Donnelly.

Here's a radical suggestion: Barack Obama should pick the smartest people he can find for his Cabinet.

Brilliance has sometimes been a criterion in presidential appointments, of course, but seldom the major one. It usually takes a back seat to rewarding friends and backers, playing congressional politics, seeking diversity, and appeasing industry and interest groups. Presidents also feel obliged to avoid too many retreads and place a high premium on personal loyalty.

Obama can't avoid such considerations, of course. He needs to cultivate his congressional relationships, avoid alienating allies where possible, and rely on people he trusts. President No Drama doesn't want a Cabinet full of undisciplined prima donnas. But it makes sense for Obama to give greater weight to intellectual acumen and subject-specific knowledge than his recent predecessors have, both because of the depth of the problems he faces and because of his own style as a thinker and a decision-maker. Bush, whose ego was threatened by any outburst of excellence in his vicinity, politicized all policymaking and centralized it in the White House. Obama, happily, has the opposite tendencies. He is intellectually confident, enjoys engaging with ideas, and inclines to pragmatism rather than partisanship. He can handle a Lincolnesque "Team of Rivals" or a FDR-style brain trust. And he's going to need one.

The issue starts at the Treasury Department, where the best choice would be former Clinton Treasury Secretary Lawrence Summers. Summers is the outstanding international economist of his generation, someone whose brilliance is immediately evident in any conversation. I happened to run into him at a dinner in New York a couple of days after Lehman Bros. was allowed to collapse. Summers analyzed the situation, which he said had suddenly become far more dangerous, with a clarity I haven't heard from anyone else since. He explained that it was simultaneously a crisis of liquidity, solvency, and confidence and that the government would ultimately have to inject capital into financial institutions and not just buy up distressed assets. It took Treasury Secretary Hank Paulson another three weeks, a defeat in Congress, and a jump-start from Gordon Brown to find his way to a similar conclusion.

Summers can also be arrogant and politically incorrect. He sometimes does a poor job hiding his contempt for lesser intellects and loves to play the intellectual provocateur. Socially, he can be a bit autistic. But these are the defects of a superior mind, and they are a small price to pay for getting the person most likely to maximize our chances of avoiding a full-scale global depression. To say that Summers is the best person for the job of treasury secretary is no knock on others frequently mentioned, including New York Federal Reserve President Timothy Geithner and New Jersey Gov. Jon Corzine, both of whom are highly qualified. But if chosen, the first thing either of them would do is call Summers for advice.

snip//

Among the intangible tasks Obama faces is vanquishing the anti-intellectualism of the past eight years, the prejudice that serious policy discussion is too effete for the Cabinet Room or the Oval Office. If he really wants to bring change to Washington, the new president should start by putting a sign in his window: No hacks.

[annabanana]

1. Summers is a supply side, trickle down, Chicago school

pal of Greenspan (who never imagined that bankers needed watching). How do we take a new direction with him calling the shots?

[babylonsister]

2. If he's the smartest guy in the room, it will be a tough decision. nt

[annabanana]

3. So.. Brilliant but WRONG trumps less brilliant

and maybe more imaginative?

[babylonsister]

4. I have read many people who think he'd be perfect because of

his brilliance. I'll wait and see who PE Obama selects.

[ozone_man]

5. The Americans voted for change

Saturday, November 15, 2008
By Naomi Klein

The more details emerge, the clearer it becomes that Washington’s handling of the Wall Street bail-out is not merely incompetent: it is borderline criminal.

In a moment of high panic in September, the US treasury pushed through a radical change in how bank mergers are taxed - a change long sought by the industry. Despite the fact that this move will deprive the government of as much as $140bn in tax revenue, legislators found out only after the fact. According to the Washington Post, more than a dozen tax attorneys agree that “(the) reasury had no authority to issue the (tax change) notice”.

Of equally dubious legality are the equity deals the treasury has negotiated with many of the banks.

(clip)

This same market-coddling logic should, we are told, guide Obama’s selection of treasury secretary. Fox News and MNSBC explained that Larry Summers, who held the post under Clinton, is the man “the Street would like most”. Let’s be clear why. “The Street” would cheer a Summers appointment for the same reason the rest of us should fear it: because traders will assume that this champion of deregulation will offer a transition from Henry Paulson so smooth that we will barely know it happened. On the other hand, someone like Sheila Bair, the chairman of the banks’ insurer of last resort, the Federal Deposit Insurance Corporation, would spark fear on the Street - for all the right reasons.

http://www.thenews.com.pk/daily_detail.asp?id=146776

Larry Summers is not change. He's the smooth transition form Paulson to keep Wall Street happy. It really is time for a change. This Sheila Blair sounds like a much needed change for Wall Street. The last thing we need is another Clinton administration with Rubinomics that got us into this fix with their bubble economics. Start by reinstalling Glass-Steagall which Clinton repealed.