It’s Not Larry Summers
Posted on March 23rd, 2012 in Uncategorized | 24 Comments »
President Obama is nominating Jim Yong Kim, the president of Dartmouth, as head of the World Bank.
Dr. Kim, an American physician who was born in South Korea and raised in Iowa, is a surprise pick for a job that has usually been held by people with political or banking experience….
Obama’s choice is also a surprise because it isn’t one of the usual suspects; the candidates most often mentioned were Hillary Clinton, Larry Summers and Columbia economist Jeffrey Sachs.
24 Responses
3/24/2012 7:44 am
How do Wikipedia entries get scrubbed? Yesterday Jim Kim’s entry included controversies like his $30,000 coffee machine in his Dartmouth office and the SAE hazing scandal at Dartmouth. Today they are gone. Seriously, how does that happen?
3/24/2012 11:36 am
And, speaking of missing entries, weren’t there a few comments on your site here yesterday that are now gone?
3/24/2012 2:28 pm
Here’s some related scrubbing
If you look at your print copy of the NY Times (Business Day B2) for today you will find the following:
“The response to Dr. Kim’s nomination was largely positive. But some development experts raised some questions about his experience and his vision for the institution.
‘The nomination suggests, on the face of it, a vision of the bank that is narrower than might be ideal,’ said Nancy Birdsall, the president of the Center for Global Development, a research organization based in Washington.
Dr. Kim clearly had experience perfecting individual programs and working in very poor countries, Ms. Birdsall said. But she added it was not clear how Dr. Kim would tackle transnational issues affecting the poor, like climate change and corruption. She also questioned how Dr. Kim viewed the bank’s role in rapidly emerging economies, like China, Brazil, India and Turkey.”
If you look up her Center for Global Development you will find
http://www.cgdev.org/section/about/board/summers
Here’s the start of a speech (quite interesting in its own right)Summers gave at the CGD in 2006(http://www.cgdev.org/files/1423130_file_Sabot_2006_Summers.pdf):
It is a great honor for me to be here, and to be the first speaker at a lecture series named after the late Dick Sabot. I didn’t know him well. I knew him mostly through the enormously enthusiastic things that Nancy Birdsall said about him during the time that Nancy and I worked together at the World Bank.
The online version of the Kim story seems not to have the Ms. Birdsall quotes:
http://www.nytimes.com/2012/03/24/business/global/dartmouth-president-is-obamas-pick-for-world-bank.html?ref=business
3/24/2012 6:02 pm
I thought “emeritus” was a title for a retired professor or professional - Neil Rudenstine, for example, is a Harvard Professor of English emeritus (according to a Harvard website search) while Derek Bok is Professor of Law and 300th Anniversary University Research Professor. Lawrence Summers did not retire as President - he is President Emeritus only in his own mind.
3/24/2012 6:39 pm
Richard, would you please explain what became of the comments that were here earlier (as Anon 3/24/2012 11:36 am has noted). As I recall, there was a comment (unfavorable to Kim) by Sam Spektor.
3/25/2012 6:35 am
Feste, they were censored! No, just kidding. They’ve always been on the post below, about whales.
3/25/2012 10:58 am
It would be understandable if Larry Summers were a little upset about not getting the WB Presidency. He has spent quite a bit of money over the last few months travelling around the world, giving media interviews, in hopes of building support for his candidacy. These expenditures are not reimbursable or tax deductable.
It would also be understandable if the community of economists who work on development felt dissed with the appointment of an anthropologist and MD to this post. They may be wondering whether this move will fuel the growing sentiment of a crisis in the economics profession. Some may wonder whether The President’s experience with his economic advisors over the financial crisis tempered his expectations about what economists can contribute to solve important problems, like reducing global poverty.
Not so obvious that this move is bad for Darmouth. If Kim was a great president, clearly this move will cut the potential benefits of this presidency by 7 years. But would Kim be taking on another challenge if he had felt that he was truly having ‘the time of his life’ as President of Darmouth. Another option is that he realized -and perhaps the board did too- early on that accepting this assignment was not a great choice, and then began to explore ways out. In which case this is a wonderful way out, it saves Darmouth and Kim a lot of explaining to the public and everyone is better off as a result.
Imagine for a moment if Summers had made a similar move the second or third year into his Presidency… say he had gone to work for the Treasury, or with his friend Nancy Birdsall -who now will be spared the opportunity to be the Chief Economist at the World Bank-, or to work in a Hedge Fund… wouldn’t he and Harvard had been all the better for it?
Perhaps Darmouth and Kim are just smarter and classier and are all privately dancing to the tunes of ‘the time of my life’ while others are still cleaning up the mess that results when arrogance prevents the acknowledgement of mistakes.
3/25/2012 11:09 am
Wikipedia, release the tapes!!!
For the last two weeks there has been a persistent and intense campaign to defame Dr. Kim from anonymous posters on sites like Wikipedia. The attorney general should look into this and request the release of the ip addresses.
Wouldn’t it be interesting if the addresses led to academics or to members of the World Bank Staff? and what would this say about a certain profession is the owners of these addresses all shared the same disciplinary background?
3/25/2012 11:34 am
Is Nancy Birdsall campaigning for the appointment of the Nigerian or Colombian finance ministers?
You have to love these Washington insiders… ‘don’t ask what you can do for your country, just ask that you can do for yourself’.
3/25/2012 1:12 pm
Would it be possible to move comments to a more appropriate thread after being posted? This isn’t the first time I couldn’t find a comment. I realize that if you started moving comments around it might cause other problems (and I suspect that you’ve already got enough on your plate), but this is as annoying as a misshelved book.
3/25/2012 2:27 pm
Feste, you seem to be asking a lot for a free service. Richard provides this blog as a public service, and as a way to engage in conversations that interest him. A curator of this blog to do what you propose would cost money. Funding it would force Richard to either: (1) donate his time; (2) post advertising on the blog; (3) charge a subscription fee to readers; (4) apply for grants.
Do you see these as reasonable options? do you have other suggestions?
3/25/2012 2:30 pm
Anon 10:58 seems to have gotten it right in the third paragraph. That’s exactly what has been coming out of Dartmouth after he had been there three months. The word arrogant has come up more than once in speaking with people who are knowledgeable about what has happened.
3/25/2012 3:26 pm
If anon 2.3pm is right then we are all screwed, because the chinese or the europeans will not support Kim’s candidacy… this will be an embarassment for the US, the WB will end up with the Nigerian finance minister, and Darmouth will remain stuck with their arrogant president. ‘The times of our lives’… and Obama will end up with egg in his face, just in time for the GOP to use it as additional ammunition against him… so to top it all, we may end up with Santorum as The President.
3/25/2012 3:47 pm
Is arrogance a plus or a minus for the job?
http://www.devex.com/en/blogs/the-development-newswire/felix-salmon-jeffrey-sachs-is-an-arrogant-economist
3/25/2012 3:51 pm
on a scale of 1 to 10, 10 being ‘most arrogant’ how should would you rate:
a) Larry Summers
b) Jeffrey Sachs
c) Jim Y. Kim
http://partisan.blogs.hopelesslypartisan.com/item_11652.htm
3/25/2012 3:54 pm
Anyone who is really curious can click “View history” on the Wikipedia page and watch the various attempts to spin the bio. Great exercise in using caution with Wikipedia; you can see how recently any alleged fact was inserted or removed.
Hadn’t noticed the Felix Salmon column about LHS until David Warsh pointed it out this morning, and did not realize that Summers was back at DE Shaw.
Referring to an interview in which Summers denied the suggestions in Inside Job that he was conflicted, Salmon reasons:
Now according to Larry’s own logic in the answer he gave to Guru-Murthy, it’s perfectly reasonable, given the alacrity with which he accepted DE Shaw’s millions, to ascribe his actions in the Obama administration to loyalty to the financial sector. We now know that when Summers was giving this interview, he was already back at work for DE Shaw. Which is why he was so careful to confine his answer only to his activities during the Clinton years. If accused of being a creature of the revolving door during the Obama years, he could adduce no such defense: he literally left DE Shaw to join the Obama administration, and then revolved straight back into that job when his temporary government gig was over.
3/25/2012 4:05 pm
Sorry, here is the Salmon link:
http://blogs.reuters.com/felix-salmon/2012/03/23/larry-summers-the-revolving-door-and-the-world-bank/
3/25/2012 4:09 pm
Harry, aren’t some of those ip addresses in wikipedia a Harvard ip address? and one of them seems to be a Columbia address.
type the ip address in google and it may lead directly to the source.
3/25/2012 4:13 pm
This is a very serious accusation of Professor Jeff Sachs about his former classmate Professor Larry Summers
https://twitter.com/#!/JeffDSachs/status/182545748569755648
Given how much $$$ the episode that Sach is mentioning cost Harvard University, shouldn’t the University create a commission to ask Larry Summers what he knew when? If, as President of Harvard, he had inside knowledge of behavior that ultimately caused Harvard serious financial and reputational losses, shouldn’t he be accountable for that form of malpractice?
3/25/2012 8:49 pm
That is true and is old news about which, however, no one in an official position at Harvard has ever expressed the slightest interest. This was, indeed, at the heart of the crucial question Fred Abernathy put to Summers about the Shleifer affair: What do you think about Harvard’s involvement in the scandal? To which Summers replied, falsely, that he didn’t know enough to have an opinion.
Here are a couple of excerpts from Summers’ deposition in the HIID/Shleifer case. This too, like the infamous memo, would have been dredged up if he had been nominated for the World Bank position.
Q. During the time that you worked at the United States Government in any capacity, did you make an assessment of the impact on the work that was being funded by USAID of the conduct which was addressed in the investigation?
… [various clarifications and objections omitted]
A. … I had enough knowledge of Russian mores and Russian practices and Russian views from the conversations that I had with Chubais and Vasiliev to be confident that the set of issues contained the allegations were not issues that were consequential for them; and indeed that they would have, in part, valued advisers more extensively if they were more involved in actual private-sector activities.
…
Q. Is it your view that it is not necessarily a conflict of interest or it is not per se a conflict of interest or otherwise improper to make investments in a country just because you’re providing advice to the government of that country?
[Objections]
A. It was the U.S. Government’s objective in the time that I was there to engage in what was referred to as commercial diplomacy, which consisted in a variety of different ways of seeking to encourage foreign governments to take advice form individuals or companies who had particular interests and motives in those countries.
It was the practice of the Treasury to take advice from investment banks on bond market issues from others with a stake in development of those markets. It was common for the Treasury to listen to advice on currency intervention from those with undisclosed positions in currency markets. It was commonplace in our cooperation with financial markets, for example, to speak with members of the board of the New York Stock Exchange about market integrity, all fo whom had a variety of positional interests with respect to different aspects of the market functioning.
So without judging what would or would not be a conflict of interest, what would or would not constitute a conflict of interest, it certainly would be my view and I think would have been the view of other U.S. financial officials that there was no per se disqualifying of the validity or morality of advice based on the holdings of financial positions in the entity, area, place, type of investment, or anything else with which the advice was given.
How conflict-of-interest issues were to be addressed in any particular context was an issue that was left to the lawyers. And it was our practice to ourselves follow the guidelines or the contracts which we signed. But there was no aura of wrongness of any kind that would be associated with providing advice on a financial issue in which one had an interest.
3/25/2012 10:12 pm
Harry, one day -perhaps- there will be a truth commission at Harvard, that will examine all the evidence on this sad chapter, and will also examine why no one in an official position took any interest in something so consequential to the true interests of the University.
3/26/2012 8:04 am
As for Sachs’ twitter allegation that Summers knew about Shleifer’s activities, it should not be taken at face value. Within the economics community it is an open secret that Sachs and Summers have been bitter rivals for years. In fact, when I bought Harvard Rules, the first thing I did was to look in the index for Sachs entries, as I expected to learn more about this rivalry, which has affected both careers. I think that Sachs decided to leave Harvard the moment that Summers, whose candidacy was heavily supported by most in the economics faculty (especially Shleifer), was chosen as Harvard’s president.
3/26/2012 8:33 am
Agreed that Sachs and Summers have a serious rivalry and anything Sachs says (or tweets!) about Summers should be regarded with skepticism. But that doesn’t mean it’s wrong. The deposition testimony I quoted says that Summers knew Shleifer was involved in self-dealing — he just didn’t think there was anything wrong with it, and in fact, under Russian mores, they’d trust the advice Shleifer was giving them more if they knew he had some skin in the game.
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