By James Kwak
I generally refuse to be drawn into the Yellen-Summers horse race because (a) everything that can be said, has been said, (b) I have no original information or insight, and (c) it’s all speculation anyway. But I’m going to comment on one parenthesis in Felix Salmon’s good summary post, since it has broader application:
Summers is, to put it mildly, not good at charming those he considers to be his inferiors, but he’s surprisingly excellent at cultivating people with real power.
In my personal experience, especially in the business world, this is absolutely the worst personality trait you can find in anyone you are thinking of hiring. You see it a lot, especially in senior executives. Unfortunately, at the time of hiring, you only see the ability to manage up—not the inability to treat subordinates decently. By the time you figure it out, you’ve already suffered serious organizational damage. (Thanks to my friend Marcus Ryu for identifying this problem so clearly.)
Powerful, self-confident people—like Barack Obama—are especially vulnerable, because they tend to make decisions based on intuitive judgments, and they form those judgments based on personal impressions—exactly the thing that two-faced psychopaths are good at making. (I’m not saying that Larry Summers is necessarily a psychopath, mind you—but apparently a lot of corporate CEOs are.)
This is just another reason that it makes sense to hire people based on their objective records, not the warm fuzzy feeling you get from the job interview. Thankfully, Summers has a record to go on. Hopefully Obama will keep it in mind.