Why a CEO shouldn't run the NEC
For all his flaws--and there are plenty of them--Larry Summers will be missed when he leaves his post as the director of the National Economic Council. He doesn't have the best record on politically correct viewpoints. He has been called alienating, strongly opinionated, and difficult to work with by his peers.
But whatever you may think of Summers--and he has drawn sharp criticism from both the right and the left--he is widely credited with helping the president stave off another depression, and his gravitas and intellectual heft when it comes to economics will be extremely difficult to replace.
That's why the Obama administration's consideration of a corporate executive to fill the role is such a head scratcher to me.
The chatter following the news of Summers' departure is that Obama would like to replace Summers with a CEO to help mend the relationship between his administration and big business. Anne Mulcahy, the retired chairman and chief executive of Xerox, has been mentioned. So have Citigroup's Richard Parsons and GE's Jeffrey Immelt.
I have enormous respect for several of these executives. But none of them are remotely close to being economists. Mulcahy did an extraordinary job turning around Xerox when she became CEO (and has some smart lessons for leaders that Ezra Klein points to here). While she is seen as a frontrunner by some, she spent her entire career at the copier company, much of it in top human resources and sales roles.
Dick Parsons has some experience in Washington and has served time as chairman or CEO of two banks, but he is a lawyer, not an economist, by trade. Jeffrey Immelt may run the country's largest industrial giants, giving him a close read on the nation's economy, but his performance running the conglomerate has been lackluster, to say the least.
Some are even saying former advertising agency and Kraft executive Ann Fudge is a candidate. On what grounds? Her knowledge of consumers' cheese habits?
With Austan Goolsbee promoted to run the Council of Economic Advisers following Christina Romer's departure, some may argue Obama will be more free to select a less wonky choice for the NEC directorship. And indeed, Summers' replacement should be a better manager of the economic policy process than Summers was, listening to others in meetings in addition to advising the president.
But I have to agree with Reuters' Felix Salmon, who argues that "of all the positions in the White House economic team, one would expect the NEC director to actually be an economist." I find it hard to believe that there aren't plenty of intellectually brilliant economists who are also great managers. They may not be big names that send a coded political message, but they would have the right credentials.
The temptation to send a signal when filling such an important leadership role is a risky one. One sees it all the time: rather than simply picking the best person for a job, leaders make political decisions on who will ruffle the fewest feathers or send the right message to their employees, their investors or their constituents. There are a select few who can serve as both ambassadors to the cause and brilliant operators or intellectuals who fill the need. They are a rare breed, and the president--or any leader--should be careful about trying to find people who can do both.
September 22, 2010; 11:09 AM ET |
Federal government leadership
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