Larry Summers Next Fed Chief? Not If His Critics Can Help It

It's mostly a race between him and Fed vice chairwoman Janet Yellen

By John Johnson,  Newser Staff

Posted Jul 31, 2013 1:02 PM CDT

(Newser) – Larry Summers or Janet Yellen. If you're a weird hybrid of wonk and gambler, you already know those two are the heavy favorites to replace Ben Bernanke as Fed chief in January. Expect to hear much more as decision time nears for President Obama, especially because an influential hodgepodge of critics has lined up against Summers, reports Politico. Everyone from women's groups to the New York Times editorial page to members of the Senate Democratic caucus favor Yellen, for reasons that range from personal to fiscal.

Critics, for example, say that Summers is sexist and gave short shrift to female staffers when working for Obama during the first term, though Politico finds plenty of women to rebut the charge; they say he's too centrist and thus won't keep up Bernanke's "quantitative easing," or stimulus, programs; and they say he pushed for deregulation in the 1990s that led to this decade's mess. The Wall Street Journal notes that Yellen, the Fed's current vice chairwoman, is "widely regarded as a 'dove,' shorthand in financial markets for a central banker in favor of easy-money policies to reduce unemployment and less worried about inflation." And it follows with this quote from a JPMorgan economist: "The general opinion seems to be that Summers would be somewhat less dovish than Yellen." Dig into both sources for details, but smart bettors also will factor in one important Summers ally: Barack Obama.

Larry Summers, the next Fed chief?   (AP Photo/J. Scott Applewhite)
Janet Yellen, vice chair of the Board of Governors of the Federal Reserve System.   (AP Photo/Eugene Hoshiko)
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