If it were possible to reduce modern neoliberalism into a single person, I think Lawrence H Summers would be make the ranking of top 10 people it could be. Larry has had a long career of working with some of the most controversial figures in American politics and is of course one himself.
After an academic career, Larry worked in the staff of the Council of Economic Advisors under Ronald Reagan and then as the Chief Economist of the World Bank where he played a vital role in developing economic strategies for developing countries by giving them structured loans so that they are forever in debt. During his tenure in the cabinets of Bill Clinton and Barack Obama, he oversaw a massive deregulation effort of finance, the bailouts of corrupt companies, and was a massive supporter of quantitative easing (referred to as money printer go brrrr on Crypto Twitter). He was even one of the American advisors to the ex-Soviet states in recommending them how to “do” capitalism.
In between his White House tenures (aka during the Bush Jr. years), he was president of one of the most elite institutions in the United States and definitely not a hotbed for developing investment bankers, future writers for the New York Times, and woke liberal activists whose parents also just so happened to have a building named after them for donating a couple tax-deductible millions, Harvard University. During his tenure is also when totally not lizard and founder of Facebook, Mark Zuckerberg attended Harvard University. Larry is the one that suggested to the Winklevoss twins to go to court over the accusation that Zuckerberg stole their idea for a social networking site as portrayed in the movie The Social Network.
After the inauguration of Barack Obama, he was made the director of the National Economic Council, the group that discusses economic policy with the president. With that power Larry proposed tax cuts to the wealthy, limiting the amount of money in the 2008 stimulus package, and removing the cap on executive pay at firms that were given stimulus money. It was later found out that Larry received millions of dollars from companies which received bailout money the previous year and proceeded to make millions after he left from speeches given to Wall Street. As you can maybe tell by now, Larry’s done a lot for the continued development of neoliberalism in America and its current decay.
On the cursed day of May 11th, 2020, friend of the blog, Larry Summers sat down for an interview with Michael Casey, Chief Content Officer of Coindesk and Naomi Brockwell to talk about “Money Reimagined.” Lucky for you, I watched the entire interview so you don’t have to. Introduced as one of the “one of the economic thought leaders of our time” by Michael in his Aussie accent, I had to pause and collect my breath to prepare for what I knew was to come.
The irony of the director of the National Economic Council under Obama during the Great Recession and one of history’s largest “money printer go brrrrr” moments being interviewed for money advice on one of the largest crypto new sites is something that is difficult to fit your head around but with some deeper analysis, it’s clearly canon. The co-option of the crypto world into neoliberalism is under full swing and the Left would be amiss to simply ignore it or fail to grasp what the implications of this are.
Asked about his thoughts on the current stimulus money injected into financial markets by the Federal Reserve considering its significantly higher than during the 2008 crisis, Larry assures that the injection of funds resembles short-term government debt more than money contrary to the libertarian money printer go brrrr narrative. He admits however that inflationary risks are higher now than a few months ago but not something he’d predict would actually occur since the many times it has been predicted, it has not occurred.
Asked about a proposal brought forth by Mark Carney, governor of the Bank of England to create a digital world currency (also referred to as a Bancor by Maynard Keynes) to reduce the world’s dependence on the US Dollar, Larry responds “I think it’s a long shot” due to the lack of global governance and the lack of political trust with the IMF or United Nations. He proceeds to say that currencies are like languages in that there tends to be “persistence” once they are globally established. A strange way to support US as the provider of the global currency reserve to maintain imperial hegemony. He finishes the statement saying that there would then be “less public competition for private digital currencies.” If you look close enough, you can see his neoliberal boner pop up from under his screen.
They then showed a short clip of an extremely awkward Yves Mersch, member of the executive board of the European Central Bank (ECB), discussing a Central Bank Digital Currency (CBDC) held by a central bank. He claims that a CBDC could protect against money laundering, other illicit activities, or what the “ruler of the day” considers illicit depending on the level of privacy built into the design. At that moment I needed to pause the video to get my breath before I could continue on to hear what definitely smart thing Larry had to say next in response to the host’s question on how a US digital dollar could ensure privacy.
Larry’s response: “I think the problems we have now with Money involve too much privacy” because he supported the end to printing 500 euro notes that were allegedly being used for illegal activity. The main argument for CBDCs according to Larry is in fact to make it easier for the government to track the flow of money. Talk about not being able to read the room of crypto libertarians and John McAfee stans, but hey, at least Larry’s being honest about his desire for the neoliberalization of the Crypto World.
Michael Casey, one of the interviewers, uncomfortably half-affirms at the end of the interview that although people may disagree with Larry’s assessment on privacy, CoinDesk is a “wide tent” for a variety of ideas. Still waiting for them to bring on a communist though… Interestingly but not too surprising, Casey, perhaps to make up for his sin of having Larry Summers on in the first place, wrote an op-ed a few days later titled, “Money Reimagined: No, Secretary Summers, Financial Privacy Is a Vital Freedom.”
Although there are a lot of problematic things in Casey’s article, I think we can agree that adding a state-backed digital currency to the surveillance apparatus created by the Patriot Act would be detrimental to all. Not only should Larry be kept far away from any attempt at creating a CBDC, but anyone who believes in some notion of liberty as being an essential human right should be opposed to any CBDC being proposed by imperial powers.
All of this is especially frightening considering that Larry is currently an advisor to US presidential nominee Joe Biden. (Although I’m skeptical of what will come of it, Justice Democrats are trying to get Biden to to get rid of Larry.)
Larry Summers is no stranger to Consensus events. He gave a fireside chat at Consensus 2016 where he stated that he could imagine a world where JPMorgan accommodated cryptocurrencies like bitcoin along side their traditional currency services. He also states “I think it’s not right to say that blockchain is the world of existing financial institutions, and bitcoin is the world of new financial institutions.” Your neoliberal alarm should be going off wildly right now. Any Leftist should recognize the synthesis of two seemingly opposed forces (traditional finance and bitcoin) in real time that Larry’s attempted to do in 2016 and as we’ve see has continued to do today in 2020.
My word of advice to crypto event planners, stop booking Larry Summers. The guy’s done enough damage to the world already.
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