Liberal Dems Plot Against Larry Summers For Fed Chair

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President Obama met with House and Senate Democrats separately on Capitol Hill Wednesday, and faced some pushback over rumors that he may nominate Larry Summers to be the next chairman of the Federal Reserve.

Senate Majority Leader Harry Reid (D-NV) admitted after the meeting that there is significant Democratic opposition to tapping Summers for the job, but said the party will unite behind whomever the president ends up selecting.

“I personally don’t [share their skepticism]. Some of my senators have been involved publicly in directing the president’s attention to someone else,” he said. “Larry Summers is a longtime friend of mine. I like him a lot. I think he’s a very competent man. But that decision is up to the president. Whoever the president selects, this caucus will be for that person — no matter who it is.”Summing up progressives’ misgivings with Summers — a former director of President Obama’s National Economic Council during 2009 and 2010 and Clinton-era Treasury secretary — Sen. Jeff Merkley (D-OR) told Bloomberg News he’s “extraordinarily skeptical that his background is appropriate” for the important job.

“If you nominate someone who is a life-committed deregulator to be in a regulatory position and if you believe regulation is necessary to prevent fraud, abuse, manipulation and so forth, then there’s a lot of questions to be asked: Why is this person appropriate?” Merkley said.

During his meeting with House Democrats, the president came to Summers’ defense after Rep. Ed Perlmutter (D-CO) attacked him as a “bad choice.” He also reportedly implored Democrats “not to believe everything you read in The Huffington Post,” according to The Hill. HuffPost reported that Obama said HuffPost’s coverage had turned Summers into “a progressive whipping boy.”

The House won’t have a say in confirming the eventual nominee. But the Senate will. And progressives want to stop a Summers nomination in its tracks before it becomes official.

“Since the passage of Dodd-Frank, the Federal Reserve Chair has more power than ever to regulate financial institutions,” said an aide to a progressive senator, who wasn’t authorized to speak on the record. “Progressives in the Senate want a Fed Chairman who will stand up for middle class families against Wall Street, and they don’t think Larry Summers is that person. You could see a lot of progressives opposing him if he is nominated.”

Reid and Sen. Joe Manchin (D-WV) said that there was no discussion of specific nominees during Obama’s closed-door meeting with senators and that the president offered no indication that he had made a decision.

“He has a long list of people who he’s talking to,” Reid said. “He’s weighing all of their minuses and pluses and he’s going to make a decision that he believes is right for the country.”

ABOUT THE AUTHOR

Sahil Kapur is TPM's senior congressional reporter and Supreme Court correspondent. His articles have been published in the Huffington Post, The Guardian and The New Republic. Email him at sahil@talkingpointsmemo.com and follow him on Twitter at @sahilkapur.
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