Maybe I'm just paranoid...

But reading that Larry Summers is resigning makes me itchy.   While there's a perfectly plausible personal reason for his resignation, part of me worries that he sees something coming that I don't and that the shit is really going to hit the fan (Japan sovereign default?  Some other disaster?) and he doesn't want to be around when that happens.  

Comments

[Ted K]

That's actually a superb working theory. I like how you think, and wish I could say I was bright enough for that to have popped into my mind earlier today.

I could see it either way, he's so universally disliked and the risks of the job vs the rewards might have him slinking off for no other reason. But back to Harvard, where I would guess 75% of the faculty also hates his guts (certainly the female math and science teachers would)....?? It kind of doesn't add up. I'm definitely not buying the Harvard spiel. And for a guy like Summers being universally hated is probably a bonus, as long as he has the attention. He just drips of ego, and by the way he treated Romer behind closed doors it's obvious the man has learned nothing about interpersonal relationships.

Ireland and the EU seems to be the bigger threat now (than Japan probs). I would say 70% he's just abandoning ship out of a general fear of the small rewards vs the big risks, but it's definitely worth turning around in the mind a couple times.

[matthew]

It's been rumored for awhile that he'd be going. See this article from the Joshua Green at the Atlantic from April of this year:

http://www.theatlantic.com/politics/archive/2010/04/yes-larry-summers-is-leaving/38555/

[Brian Wolfman]

Question: Is it your theory that Summers sees a catastrophe on the horizon because he is adept at reading and understanding economic indicators and other current events and thereafter making predictions, or because in his current position he is able to act on inside information that others don't have?

[Adam Levitin]

Brian, I subscribe to the superior information theory. An alternative view is that Summers is just reading the tea leaves about the coming election and sees that there's going to just be a lot of gridlock come February.

[Bill]

Personally, I find the recent resignations of several members of the Obama economic team to be akin to rats jumping from a sinking ship.

[John Blenke]

Anytime anyone in a position to know the "true financial condition" of a business or government leaves unexpectedly (and I mean by unexpectedly - the successor is noit readily apparent or known to all) it raises a red flag. Just see what happens to a public company if a CFO announces that he/she is leaving (to pursue other interests) and the company is going to do a search for the successor. There is a call for an immediate audit and the stock price is hit hard. We have a tough time right now (as a Nation) so all surprises are bad surprises.

[bgreen]

perhaps he has burned all the evidence that would have convicted him?

[Ken]

As the author of the ‘Black Swan’ has said, why do you want the same people who presided over this crisis be there to fix it? That’s like voters for Bush’s second term indicating on national television that they support Bush for a second term because he started the war and now he needs to clean-up the mess. This logic is flawed. If he ‘sees’ something, why did he not see the crisis coming? In my opinion, he doesn’t want to lose his tenure at Harvard. I am sure he still has the president’s cell number to call him if he sees anything else…

[Tuan]

I suspect the timing on the resignation is tied to the midterm elections, the anticipated midterm election loss for the President's party in Congress, and the likelihood that the Administration is going to spend a lot of time fending off congressional oversight from an opposition in charge.

[Bill]

What about the other resignations? Summers is not the first Obama economic adviser to resign recently. Also there were recent resignations by Peter Orszag and Christina Romer. It appears that these people have discovered some troubling information (i.e. Obama's economic policies are counter-productive and will continue to be a drag on the economy) and they do not want to be associated with the resultant failure. Getting out early insulates them from blame.