Who Is Lawrence Summers?:
Lawrence H. Summers was selected by President Obama to be Director of the National Economic Council (NEC). The NEC was created in 1993 to be the top advisory clearinghouse for the President on economic issues. Summers was the 27th president of Harvard University from 2001-2006. He was Treasury Secretary from 1999-2001 and Chief Economist of the World Bank from 1991-1993.
Why Is the National Economic Council Important?:
The NEC is part of the Executive Office of the President. It has four functions:
- Coordinate policy-making for economic issues.
- Coordinate economic policy advice for the President.
- Ensure that policy decisions and programs are consistent with the President's economic goals.
- Monitor implementation of the President's economic policy agenda.
Members of the NEC come from numerous department and agency heads within the administration, whose policy jurisdictions impact the nation's economy. The NEC has its own staff of policy specialists.
Why Is Summers Good for the Job?:
Summers has a lot of hands-on expertise in the domestic economy, through his experience in the Treasury Department, and the global economy, through his World Bank tenure. Treasury Secretary Tim Geithner was Summers' protege at the Treasury Department before he took over as Chair of the New York Federal Reserve.
Why Is Summers Controversial?:
During his tenure as Treasury Secretary, Summers oversaw the repeal of the Glass-Steagall act, which prevented commercial banks from investing despositors' funds in risky derivatives. He also advocated deregulation of derivative trading. Many experts blame the repeal of this act and deregulation for the banking credit crisis and resultant recession.
As Harvard President, Summers remarked that one of the important reasons that women were not prevalent in well-paying science is engineering positions was that men had more natural aptitude.
Summers' Early Career:
Summers has been a professor of economics at both Harvard and MIT. In 1988, he served as an economic adviser to the Dukakis Presidential campaign. From 1982-1983, Summers was on the Council of Economic Advisers under President Reagan. A nephew of Nobel prize-winning economist Paul Samuelson, Summers received his BS from MIT in 1975. He received his PhD in economics from Harvard in 1982. Summers also contributes to the Financial Times and the Brookings Papers on Economic Activity, and is a director of investment firm D. E. Shaw.
