Larry Summers' Record as He Leaves White House
The outgoing White House economic adviser can alienate a room in record time. But Niall Ferguson says his intellect is worth the trouble—and he helped stave off a Great Depression.
Larry Summers speaks at the U.S.-India Business Council meeting in Washington, D.C. on June 2, 2010. (Photo: Joshua Roberts / Bloomberg via Getty Images)
"Larry was my boss when I first moved to Harvard, and indeed he really was pretty crucial in persuading me to move. He has a fantastically powerful mind, but he’s also got a fantastically abrasive personality. I really like that, as it was quite a change from the somewhat oleaginous British academic leadership.
As for Larry’s turn in Washington, the administration was facing the biggest financial crisis since the Great Depression. I have no doubt that he was a crucial decision-maker in the administration’s response to that crisis. Whatever one may say about the administration, things could have gone a whole lot worse than they did. We avoided the Great Depression and it was a pretty near-miss. I think the economic team in the White House deserves some credit for that.
What I don’t know is what his departure, along with those of Peter Orszag and Christina Romer, signals for the direction from here. It will be interesting to see who takes their places. Obama has interesting choices. He can either tack to the left, and pay more heed to the Krugmans and others, or head in the other direction, to try to head off the Republican takeover in November. My guess is his Chicago political instincts will lead him to the latter.
• Who’ll Replace Larry Summers?Meanwhile, Harvard, look out, he’s coming back. Undergraduates will be pleased. I was always surprised at how popular he was with my students. The arts and sciences people may have had it in for him but his willingness to engage on a variety of subjects with students…he really enjoyed the cut and thrust of debate about a whole range of political subjects. He used to enjoy getting into classrooms, which Harvard professors don’t always do. His pugnacious style tended to put out of joint the noses of the more thin-skinned and perhaps less intellectually confident colleagues.
I think there’s a culture in U.S. economics which makes a virtue of brutality in argument. Larry personifies that. The famous paper that began, “There are idiots, look around,” pretty much gets Larry’s style. I’ve seen him in a short space of time manage to alienate a majority of people in a room. He has a remarkable talent for rubbing people the wrong way. My view is it’s worth it, for the intellectual payoff you get. If I present a paper, if there’s something wrong with it, he’ll spot it—and tell you you’re an idiot. I rather like that. Not everyone does."
Niall Ferguson is a professor of history at Harvard University and a professor of business administration at Harvard Business School. He is also a senior research fellow at Jesus College, Oxford University, and a senior fellow at the Hoover Institution, Stanford University. His latest book, The Ascent of Money: A Financial History of the World , was published in November.