Elizabeth Warren May Control Larry Summers's Fate
Freshman lawmakers rarely influence outcomes in the Senate. Elizabeth Warren may be an exception if President Barack Obama nominates Larry Summers to be the next chairman of the Federal Reserve.
If the freshman senator -- the populist scourge of Wall Street -- supports her former Harvard University colleague, he probably would draw little opposition from Democrats and would likely muster enough Republican votes to win confirmation. If she opposes him, other Democrats may defect, too, and it might be a struggle to win over enough Republicans to get the 60 votes required.
Warren has signed a letter supporting Federal Reserve Vice Chairman Janet Yellen to succeed Ben Bernanke, whose term as chairman expires in January. However, Warren has indicated that she sees Summers as qualified, and people who know them both cautiously predict she would vote for him.
The choice is expected to be between Summers and Yellen. People familiar with Obama's thinking say he is leaning toward Summers.
The Warren-Summers relationship is complicated, as captured by a Boston Globe story a few weeks ago. While he was the president of Harvard, she was a faculty member at the law school. Summers was forced to step down after alienating some of the faculty members and controversial remarks about the achievements of women in science and math.
Warren wasn't one of those calling for his ouster.
After the 2008 financial crisis, Summers, who served as Obama's top economic adviser, advocated for a consumer protection agency -- a cause long championed by Warren. Yet he didn't support naming her to head it. In a book by Ron Suskind about the administration's economic policies, Warren indicated that Summers was too friendly to Wall Street, where he has made a lot of money as a consultant during his time away from government.
Warren and her liberal independent colleague, Senator Bernie Sanders of Vermont, wrote a column last week laying out the critical questions the next Fed chairman must answer. They included the dangers of "too-big-to-fail" financial institutions and the repeal of Glass-Steagall, which Warren wants to restore. Summers was a big advocate of financial deregulation in the 1990s, views contrary to Warren's. Summers has told associates he doesn't believe the questions posed by Warren and Sanders would impede him if he were nominated.
One high-level person, very familiar with both, believes the Massachusetts Democrat would ask tough questions and then support Summers if he were nominated, noting that for all their differences, they both are very tough-minded policy intellectuals. The Summers camp is enlisting political strategists on his behalf and there have been conversations with Warren.
If nominated -- and it is by no means a certainty -- the necessity of winning support from almost all of the Democrats in the Senate was underscored this week when Kansas Senator Pat Roberts, a mainstream conservative Republican, said Yellen was more qualified and that he wouldn't want Summers "to mow my lawn."
Grover Norquist, the anti-tax advocate who consults frequently with congressional Republicans, said the Fed chairmanship hasn't come up in recent conversations. The brainy Harvard economist has a legacy, though: "Summers is not respectful to people and they remember that."
Summers and Warren share at least one close confidant: Supreme Court Justice Elena Kagan. As the president of Harvard, in 2003, he named Kagan to be the first woman dean of the law school, where she had a good relationship with then-professor Warren.
(Albert R. Hunt is a Bloomberg View columnist. Follow him on Twitter.)