Arianna Huffington: Larry Summers: Brilliant Mind, Toxic Ideas
Larry Summers is one of the top economic minds of his generation, but his core beliefs and assumptions helped lay the groundwork for the current crisis. As Treasury Secretary under Clinton, he played an important role in allowing commercial banks to get into the mortgage-backed securities game. He also backed the Commodity Futures Modernization Act, which allowed financial derivatives to be traded without any oversight or regulation. So it was on his watch that the credit-default swaps warhead that has blown up our economy was launched. In 2000, Summers declared: "The traditional industrial economy was a Newtonian system of opposing forces, checks and balances... While, in contrast, the right metaphors for the new economy are more Darwinian, with the fittest surviving." He forgot to add the part about the fittest surviving by being bailed out by the rest of us.