Summers calls for federal spending as he leaves White House economic job
Monday, December 13, 2010; 6:21 PM
Lawrence H. Summers urged that spending on highways and other infrastructure be increased in his final major address as President Obama's top economic adviser, saying that Americans' impulse to save more money means the government must spend more to ensure economic growth and job creation.
Summers announced in September that he would leave his job as head of the National Economic Council to return to his professorship at Harvard University by year's end.
In his remarks, he avoided using the word "stimulus" but said that less consumer spending would hobble the economy for years. He said the decrease, however, could be offset in part by the public sector.
"A substantial, sustained effort to rebuild America should be at the top of Washington's priority list next year," Summers said in a speech at the Economic Policy Institute, a liberal-leaning think tank in Washington.
Christina Romer offered a similar plea in September as she stepped down from her post as chairman of the White House Council of Economic Advisers. But their words might not be heeded, as congressional Republicans - many of whom campaigned last year against more government spending - will take control of the House in January.
Summers's departure - along with that of Romer and Peter Orszag, the former head of the Office of Management and Budget - will reshape Obama's economic team by next year, with only Treasury Secretary Timothy F. Geithner remaining among the president's initial group of top economic advisers. The White House is expected to name Summers's replacement by the end of the month.
Summers, a former president of Harvard, defended the administration's moves to aid the economy over the past two years, even as critics on the left said the White House did too much to help Wall Street banks rather than middle-class Americans and conservatives argued that last year's stimulus package was too expensive because the unemployment rate remains near 10 percent.
Asked several times by reporters whether he would have done anything differently, Summers did not concede any mistakes.
"Would I like the results to be even better than they have been on a number of different dimensions? Of course," he said. "But I think the president is right to take pride in what has been averted."
As he did last week, Summers defended the tax agreement Obama reached with congressional Republicans. But he hinted that Democrats should fight hard against keeping the tax cuts in place for upper-income individuals in the future.
"Compromises that were necessary with a weak economy in 2010 should be inconceivable as recovery accelerates," he said.