Why the F**k is Obama Backing Larry Summers?

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Ben Cohen
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It looks like President Obama is inexplicably backing Larry Summers to become the next Federal Reserve chairman. From the Huff Post:

President Barack Obama gave a "full-throated defense" of Larry Summers in a closed meeting with House Democrats Wednesday, according to a lawmaker in the room, but said he’s nowhere near making a decision on who will be the next Federal Reserve chairman.

Summers, along with Janet Yellen, are reportedly the top contenders for the Fed post. White House adviser Dan Pfeiffer said Wednesday that no decision will be made until the fall, but that hasn’t stopped people from speculating about the frontrunner.

As  co-founder of the Center for Economic and Policy Research Dean Baker writes, "Summers played a major role in creating the economic imbalances that fostered the housing bubble and explain the weakness of the economy right up to the present." Specifically, Summers was instrumental in deregulating Wall St throughout the Clinton years Kevin Connor in The American Prospect notes:

As stewards of the Clinton economy, Summers and his mentor Rubin embraced the delusion that an unregulated financial marketplace is an ideal economic configuration. They pursued this vision with gusto, consistently bowing to Wall Street interests in championing voluntary, "market based" solutions over enforceable government regulations.

With respect to today's crisis, the most consequential example of Summers' penchant for deregulation was his support for the Commodity Futures Modernization Act, which ensured that over-the-counter derivatives (those not traded on exchanges) would go unregulated. It was a major giveaway to Wall Street banks. These financial instruments have played a starring role in the recent financial crisis.

So of course he's the obvious choice for the most important economic position in the country...