7:20: People begin to trickle out and the forum empties as Summers is welcomed back to Harvard.
Although he has been tied distinctly to Wall Street in the past, Larry Summers genuinely seems to care for the country as a whole. He is concerned about the growing inequality within the nation, the looming wave of the coming deficit, and the future of economic relations with China. He spoke about the importance of curbing the deficit, but believes that we, the United States, will endure.
Indeed, President Kennedy was sure that Russia would overtake the United States in the 80’s, and economic journals forecasted Japan and Germany coming ahead of the United States after the Cold War. It is important to note how we made it through both of these periods and that our principles of free market operations helped us endure. While in the short term government intervention is necessary, in the long run we cannot afford to be dependent on the government; we must eventually return to our principles of limited government and free markets, or we will not maintain our place in the world.
7:10: Someone notes that before the White House, Summers wrote on the efficiency of market. Has his views changed? Summers remembers differently… he wrote that financial markets are not efficiency. But (another of his themes of the night), political figures don’t necessarily work better than markets. -Lena Bae
7:06: Q: How to tackle high levels of unemployment, especially among the low-skilled? A: Investment in infrastructure, education/training, recognize importance of service sectors. -Lena Bae
7:00: Acknowledges that he made some mistakes with certain kinds of de-regulation in the past, but posits that not all de-regulation is bad. Good point. It is good that he does not generalize about all regulations. –Lucas Swisher
6:58: First q: how can elected officials reform market failure, when they’re dependent on campaign finances? Summers says Obama succeeded in passing most far reaching health and financial reform bills in many decades. Says we should be careful about assuming our democracy doesn’t work. Ok, assumption that Obama is representative of admins in general?? -Lena Bae
6:58: Open floor!
6:55: Jokes about The Social Network- Of the two movies he has been in, The Social Network was definitely not his favorite. The Social Network posited him as “mean” to the “Winklevie”- and if it did, he probably was!- Lucas Swisher
6:48: Summers clearly knows his IR theory. Notes that when rapidly rising powers’ relative strength changes quickly, the international system is likely to accommodate those changes awkwardly and badly. Summers advocates that we should respond to China’s change with thoughtful management on both sides, and that we should “invest in understanding China”. So he’s not in The China Threat boat, nice. But doesn’t really offer concrete advice. -Lena Bae
6:44: Makes a Sparta to Athens analogy- Nice culture reference. Are we Sparta and China Athens? – Lucas Swisher
6:40: Questioned about the future of jobs, Summers notes manufacturing is going through a profound transition, and that future jobs are going to come from essential services, but services in which it’s difficult to drive productivity increases. Strange that he doesn’t mention immigration or outsourcing at all. -Lena Bae
6:38: He finds problems with rising inequality between the top 1% and the rest of the country, but does not want a cap on corporate compensation and believes in purely market systems as a solution to raising middle class incomes? There seems to be some kind of contradiction here. –Lucas Swisher
6:36: Summers believes that we have to re-legitimize public institutions, starting with schools- but how? –Lucas Swisher
6:31: Summers acknowledges that “confidence is the cheapest form of stimulus”, and that hostility between the administration and investment banks may have had an adverse psychological impact on recovery. However, he argues that the facts say that in the last 2 years, we’ve seen the best performance of corporate profits and stock markets since WW2, whether or not people were feeling bad, and in his consistent support of Obama, notes Obama was “the one standing between [the CEOs] and the people with pitchforks.” -Lena Bae
6:24: Summers believes reigning in the deficit is urgent; while in 2 years the sky may not fall, in 10 years is very well may.
Summers believes that the President acted appropriately- it was better to address all possible market failures than only target them and miss some. Obama acted wisely in avoiding a second great depression, but now he will be judged on whether he can provide the next generation with a sound nation.-Lucas Swisher
6:21: Gergen asks whether there is an urgency to get deficits under control. Summers: “I don’t subscribe to the sky is falling school… we are a decade plus from being where Japan is.” -Lena Bae
6:11: Gergen asks if it is time for Obama to come up with a deficit proposal. Summers responds that it is not time to slash spending quite yet- The economy still needs increased spending to grow. However, Washington is not all about policy- everyone wants a piece of the credit. It is more a political judgement than anything. –Lucas Swisher
6:08: The crowd claps as Summers, Allison, and Gergen walk in. Summers grins and points toward the crowd as he sits down. -Lena Bae
6:00: People continue to shuffle in; it appears relatively empty for a forum event. Security is light- I was even able to get in without my I.D. We are excited to hear from Professor Summers for the first time since his return to Harvard!- Lucas Swisher