The long, hot Summers' story

The Times' front-page story on Larry Summers has something of a "Larry bites man" quality to it: Summers developed a reputation for belittling and ridiculing professors at Harvard before he was sacked as president, so his refusal to play nice with others isn't exactly news.

Furthermore, the fact that top Administration officials are unwilling to give anything but "it's all in good fun" on-the-record quotes about Obama's closest economic adviser, is equally unsurprising. This all seems like a less scandalous version of the McCain affair piece the Times ran last year. We have a man with a reputation for doing certain things, possibly some damning off-the-record conversations intimating that he is still doing those certain things, and a story with innuendo and a few pretty blase anecdotes. Is this really worth a spot on the front page?

It would be more illuminating to put Summers' abrasiveness in broader context. Summers -- much like Geithner -- is a Rubinite who made some pretty poor economic policy decisions in the not-so-distant past, and developed less regulation-friendly positions at what one might call a politically opportune time (ie the rise of Obama and the collapse of the financial markets).

The real story here is not whether Summers hurt Romer or Orszag's feelings. It's whether he's paying lip service to the idea of real reform and regulation in the banking industry while undermining the actual voices in the Administration who are calling for those things. The real story is that while a year ago liberals worried that Austan Goolsbee was too moderate and conventional an economist to be in Obama's inner circle, he's now the advisor trying to pull policy leftward.

In a nutshell, since we know Summers is a jerk, I'd like to see more on what that has to do with the price of eggs (literally). Mark Penn was such a jerk that Clinton's campaign devolved into civil war and public backstabbing (oxymoron alert!) even before her electoral chances disappeared.

Clearly, Summers is not that type of jerk. But the only evidence the Times offers that he's doing a good job are his efforts to join the "populist" side in a few losing arguments, vague indicators that the economy is bouncing back, and the standard line from anyone asked that Summers is a hardass, but brilliant. An excellent excuse to work in some insidery tidbits about birthday cupcakes and fly-swatting, but I'd like to see more meat in an article about a guy with a good deal of control over our economic future.

Some more books I won't read

THE SYLLABUS

A few weeks ago, prompted by the economic crisis, I tossed aside my previously compiled reading lists and posted some new persuasions. Picked in haste, the list was bound to grow. So here are a few additions. They were also picked in haste. Moreover, they are chance finds--in a display shelf, next to a book I was looking for, mentioned in a radio program. But all seem promising. In some cases, simply as models of an innocent, ignorant past.

BUSINESS AND FINANCE
Current Meltdown
Trillion Dollar Meltdown - Charles R. Morris
Dumb Money - Daniel Gross
Pre-meltdown
Good Guys & Bad Guys - Joe Nocera
Maestro - Bob Woodward
General
The Tyranny of Dead Ideas - Matt Miller
Not really related, but I just read it
Outliers - Malcolm Gladwell

Lots of Sunday confusion

CURRENT EVENTS

From today's New York Times article on how Sonia Sotomayor would be the Supreme Court's sixth Catholic:

A White House spokesman, speaking on background, put it this way: “She currently does not belong to a particular parish or church, but she attends church with family and friends for important occasions.”

Why is this on background? I simply do not understand. Is everyone forbidden to speak about her? Then why speak at all? Are even anodyne political justifications too hazardous? Why do newspapers put up with this?

And I simply do not understand, for entirely unrelated reasons, why this isn't seen as a profoundly ironic thing to say:

But legal scholars say that while Judge Sotomayor’s Catholic identity will undoubtedly shape her perceptions, they will not determine how she would rule on the bench.

Replace "Catholic identity" with "Puerta Rican background."

A meditation on the virtue of a vigorous national paper: On the day Obama announced the nomination of Sonia Sotomayor for the Supreme Court, the New York Times published, in addition to their straight-up news story and a analysis piece, a biography of her that ran six virtual pages. It also carried this insane credit:

Contributors to this article include Jo Becker, David Gonzalez, Jodi Kantor, Serge F. Kovaleski, William K. Rashbaum, Benjamin Weiser, Manny Fernandez, Karen Zraick, Colin Moynihan, Richard Pérez-Peña and Michael Powell and Tamar Lewin from New York; and Charlie Savage, Scott Shane and Neil A. Lewis from Washington. Kitty Bennett, Itai Maytal and Barclay Walsh contributed research.

Add the author, Sheryl Gay Stoleberg, and it was a 20-person effort.

What does an eighth-grader read?

ACADEMIC STANDARDS

When I started as a journalist, I was told to write to an "eighth grade reading level." Having no idea what was appropriate for an eighth-grader, I just wrote as simply and clearly as I could. At that time, I was more often graded up--experienced editors replacing my clumsy phrasing with one of those swift verbs journalists rely on (and sometimes overuse)--than down. With time, I've learned the key is consistency; if you're going to drop a ten-dollar word, you better spend heavily through the whole piece. That's why this lede perplexed me:

Even lionized super-presidents occasionally placed boneheads in prominent positions, and paid a price for it. A certain memo from Abraham Lincoln, donated to the National Archives by a private collector yesterday, reminds us of this. (my emphases)

I wager "boneheads" have never been so near to--or nearly--"lionized." I applaud the intent, but even ignoring the odd tense of the first sentence and the curious structure of the second, I find myself a bit bewildered. Will the tone be polished or populist? But then what follows for the next few grafs is merely Washington Post-pedestrian--flawless and sharp but lacking a distinctive style. Then we get a nutgraf that must have cost a fortune:

The memo seems a startling distraction to a president embroiled in a cataclysmic and bloody war. Thus it neatly illustrates one of the immutable laws of presidential politics then and now: Individual imbroglios fester at will, anytime, without regard for the deeper national crisis. (again, my emphases)

I know all these words. Heck, I would like all of them to come to tongue as readily as they seemingly do for Dan Zak. However, grouping them in one graf is like a linguistic firework finale. It sure as hell gets your attention--but it distracts from a fascinating story that is otherwise quite well-told.

AP Style Fact: Elementary school children and middle schoolers carry not just backpacks, but hyphens. From the moment they become "first-graders" to when they cease to be "eighth-graders."

Sotomayor, Sotomayor, Sotomayor and other Thursday readings

CURRENT EVENTS

Sotomayor is everywhere. What do we know about her?

Politico tells us that she would likely be the poorest member of the Supreme's, she dislikes the selling of the presidency (and other offices), last year she won nearly $9,000 gambling, and Democratic strategists are pushing the "misspoke" strategy on the "wise Latina" comment.

The New York Times informs us that the selection process reached out to allies so she wouldn't "chewed up by friendly fire" and to Republicans on the Judiciary Committee. Then it tells us about the allies chewing her up and the Republicans on the Judiciary Committee who say it is "premature" to render judgement, but still find her comments "very troubling."

The Washington Post eschews actual news and has Eugene Robinson, Dana Milbank, Charles Krauthammer and Michael Gerson each say their piece.

So much ink.

###

It takes a fearless paper to run a front-page story on teenagers tendency to clasp one another with their arms. Yes, hugging is all the rage at the NYT.

Lewis and the Big Swinging Dicks

BOOK REPORT

In 1985, the most talented young trader in the most profitable division of Wall Street’s most profitable firm made a decision that would destroy the division and ultimately the firm. He decided to leave.

Howard Rubin, a former Las Vegas card shark, had been paid a $175,000 bonus the year before. It was the maximum allowed a second-year trader under the guidelines of his employer, Salomon Brothers. But while he had made a fortune--$30 million--for Salomon, as had his entire division, the firm as a whole had not done well. So, when Merrill Lynch (a happier, flusher vintage) promised him $1 million a year plus trading profits, he jumped ship. Over the next months, most of his shipmates did the same. Salmon never recovered.

Reading Rubin’s story earlier this year in Liar’s Poker, Michael Lewis’ two-decade-old account of his time playing “possibly the most absurd money game ever,” it was hard not to think of AIG. The companies’ situations are hardly comparable; Salmon was making a killing, AIG is smothering American taxpayers. Yet if a fresh initiate to the money culture was willing to leave the hottest department at the hottest firm on Wall Street (a firm that, according to Lewis, Rubin cared deeply about) for a few dollars more, then why should one expect anything else from the despised wretches at AIG.

There are a lot of comfortable truths in Lewis’ book. Wall Street’s herd mentality, rumor-mongering (in a two year span, he recalls, Chairman of the Federal Reserve Paul Volker resigned seven times and died twice), sexism, racism, and fundamental absurdity (“Why did investment banking pay so many people with so little experience so much money? Answer: When attached to a telephone, they could produce even more money”) are all well documented.

Lewis even decries the forgetfulness bred by bonuses, the receipt of which he likened to a meeting with the “divine Creator” to learn “your worth as a human being.” “On January 1, 1987”—the day of the meeting—“1986 would be erased from memory except for a single number: the amount of money you were paid. That number was the final summing up.” Hindsight can’t be monetized, it seems.

And, despite its vintage, the book provides some eerie echoes of the current crisis: the failure of ratings agencies, the biggest bonuses on the eve of the bust, and the separation of borrowers and lenders. The real shocker is his own firm’s role in the creation of most of today’s problems—mortgage bundling, mortgage securities, collateralized mortgage obligations, etc. But the less convenient implications of his tale are no less instructive.

Much of the book concerns the rise and fall of Salomon’s “marvelous money machine,” or mortgage department, which was responsible for the creations listed above. The division had made the bulk of the firms money for the better part of a decade, yet when it is dismantled near the end of Lewis’ short tenure there, we learn that upper management, including John Gutfreund, who at the time paid himself more than any other Wall Street CEO, needed a private seminar on mortgage-backed securities. If you believe Lewis on all other accounts, you have to believe him that sometimes management are a bunch of know-nothings.

This all gives no credit to Lewis’ writing itself, which deserves a post of its own, especially given this blog is dedicated to journalism, not financial matters. Suffice to say that the book is consistently funny, occasionally snarky, satisfying introspective without being solipsistic and always crystal clear. We don’t get MBA’s managing the capital flows and allocating resources, we get Big Swinging Dicks terrorizing geeks and waging war.

A strikingly similar perspective from... Gitmo

CURRENT EVENTS

Newt Gingrich's favorite target of late has been the group of 17 Chinese Muslims, known as Uighurs, being held at Guantanamo. In response to concerns that repatriating them to China would lead to them being tortured, he asked his Fox handler, "Why is that our problem?" And in a recent Washington Examiner op-ed, he charged, falsely, "[b]y their own admission, Uighurs being held at Guantanamo Bay are members of or associated with the Eastern Turkistan Islamic Movement (ETIM), an al Qaeda-affiliated group designated as a terrorist organization under U.S law."

The Uighurs, who have say they were never members of the group, had a chance to respond recently, in what some are calling the "first quasi-interview with detainees imprisoned in Guantanamo." From the Huffington Post:

"Why does he hate us so much and say those kinds of things? He doesn't know us. He should talk to our attorneys if he's curious about our background," [their translator Rushan] Abbas relates. "How could he speak in such major media with nothing based in fact?...

The Uighurs are apparently under the misconception that American columnists are fact-checked for accuracy. "They just cannot understand," she says. "How come the media doesn't even verify the story? How could they just publish something like that without checking whether what he says is true or not?"

I often ask the same thing myself.