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Thursday, 08 August 2013 07:23

Sen. Elizabeth Warren Mocked Larry Summers as Eva Peron in 2009, Backs Janet Yellen to Head Federal Reserve

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warren468 10Sen. Elizabeth Warren (D - Massachusetts) is publicly supporting Janet Yellen, current vice chairwoman of the Federal Reserve, to head the agency.  This puts her at odds with those within the White House, including allegedly President Obama, who back Larry Summers to chair the Fed, although she has not officially opposed Summers.

Thus far, there has been no nomination, just mainstream media rumors of the White House tilting in favor of Summers.

According to an article in the Boston Globe on August 8, Warren openly mocked Summers in 2009 at Reagan National Airport:

Warren criticized the Obama administration for not cracking down on big banks, and she compared his advisers — including Summers specifically — unfavorably to a country in South America that decades ago used government funds to try to prevent banks from going under.

“Tim [Geithner] and Larry’s whole plan is just like Argentina in the 1980s,” Warren told author Ron Suskind in September 2009, while he was working on “Confidence Men,” a book on the aftermath of the financial collapse. “There was this giant hole marked ‘Banks’ and the government just dumped money in that hole, as much as they had, while they lied about it. That’s what Larry thinks: that the US is Argentina!”

While Warren and Suskind were waiting at a terminal in Washington’s Reagan National Airport, Warren began to sing, “Don’t Cry for Me, Argentina.” Several started to applaud, and she modified the verse, with Summers in the role of Eva Peron.

“Why not?” Warren said with a laugh. “He might understand things better as a woman.”

Summers, according to the Globe, in turn privately (but not publicly) opposed Warren to head the Consumer Financial Protection Bureau:

Summers opposed Warren for the post, according to Warren supporters in and outside the administration, as well as Suskind, who said in his book that Summers grew irritated when [Christina] Romer [chair of the Council of Economic Advisers] threw her support behind Warren.

During the meeting at the White House, which Suskind recounted, Summers arrived late, disheveled. He asked a few questions and departed abruptly to go take a call.

The next day, in the Oval Office, Obama told Warren he was not going to nominate her to lead the agency, instead naming her a “special assistant to the president’’ to help get the bureau running.

Summers apparently hasn’t publicly described his role in the matter; a Summers spokeswoman would not comment.

Although some of the historical relationship between Warren and Summers is a bit more nuanced (going back to their Harvard faculty years) according to the Globe, Warren makes it clear on her senate website where she stands.  In the "about" the senator section, the second sentence reads: "Elizabeth is recognized as one of the nation's top experts on bankruptcy and the financial pressures facing middle class families, and the Boston Globe has called her 'the plainspoken voice of people getting crushed by so many predatory lenders and under regulated banks.'"

That indeed puts her at direct odds with the "deference to banks too big to fail" crowd in the White House and most of Congress.

(Photo: qwrrty)