Larry Summers: Fed destroyer or just another slave to the system?

|By:, SA News Editor

Larry Summers would make the Fed increasingly political and threaten its independence, Felix Salmon worries: "Summers has been one of Obama’s closest economic advisers... He’s the kind of person [who] would bully the rest of the board into doing exactly what he wanted them to do... The result would be a central bank [with] zero independence from the government."

Such criticism misunderstands how the Federal Reserve system is designed, Cullen Roche counters: "The Fed’s true master is the banking oligopoly... As long as that banking oligopoly is a private for profit industry, the Fed will have to act in the independent best interests of the banking oligopoly before it can serve its other masters - the president, the congress, and the taxpayer."

Either way, the loud public debate over the selection has become a spectacle: "We may be entering an era where the Fed chairman job is as much a lightning rod as any other major appointment," Neil Irwin writes.