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WSJ: Former U.S. Treasury Secretary Lawrence Summers Withdraws Name for Federal Reserve Chairman Position


He has called President Obama on the matter, citing an 'acrimonious' coming confirmation battle.

LONDON - MARCH 25: Lawrence H. 'Larry' Summers, former U.S. Treasury speaks during a financial and economic event at the London School of Economics (LSE) on March 25, 2013 in London, England. The European Union's decision to recapitalize Cypriot banks by inflicting losses on depositors and senior bondholders is triggering investor concern about the knock-on effects for bank funding across the region. Credit: Getty Images

According to the Wall Street Journal, former U.S. Treasury Secretary Lawrence Summers has withdrawn his name from consideration as Federal Reserve chairman and has called President Obama on the matter, citing an expected "acrimonious" coming confirmation battle.

Lawrence H. Summers, former U.S. Treasury Secretary, speaks during a financial and economic event at the London School of Economics (LSE) on March 25, 2013 in London, England. (Credit: Getty Images)

The White House disputed a Japanese newspaper's report that Summers will be named the next chairman of the Federal Reserve by President Obama, according to USA Today.

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The Nikkei newspaper, which did not publicly name its sourcing for its story, said Obama was "set to" name Summers to the position, possibly as early as next week.

White House spokeswoman Amy Brundage said in a tweet Friday that "the latest rumors this morning in the Japanese press aren't true" and that Obama "has not yet made a decision on Fed Chair."

Earlier this summer Obama pushed back against liberal Democrats who urged the president not to pick Summers to run the Federal Reserve.

In a closed-door session with House Democrats, Obama offered what participants in the meeting described as a keen defense of Summers after being pressed by Rep. Ed Perlmutter of Colorado about his controversial consideration of Summers to replace the Fed's outgoing chairman, Ben Bernanke. The defense continued at the White House, where press secretary Jay Carney said Summers had "stood shoulder to shoulder" with Obama during an economic crisis.

"He made decisions and put forth the policies that helped reverse the tragic economic decline that this country faced in the beginning of 2009," Carney said, adding that Obama's kind words about his former aide shouldn't be misconstrued as an omen about whether Obama would pick him for the top Fed post.

The head of the National Economic Council during Obama's first term, Summers served as treasury secretary from 1999 to 2001 under President Bill Clinton, and his performance in that role drew criticism from liberals who remain unhappy with Summers' push to deregulate financial markets.

"It would be a tragic mistake to nominate anyone as chair of the Fed who continued those failed policies," said Sen. Bernie Sanders, I-Vt., one of the most liberal members of the Senate. Sen. Dick Durbin of Illinois, a member of the Senate Democratic leadership, has said he would have numerous questions for Summers before being able to support him.

Obama's pending decision has attracted widespread attention and sparked substantial controversy, in part because of the major role the Fed chairman will play in managing an economy still struggling to recover from the recession.

Summers' critics have alleged he's too cozy with big Wall Street banks. Women's groups have also bristled over comments Summers once made questioning their abilities in math and science during his tenure as president of Harvard University. A few dozen female Democrats in the House have signed a letter urging Obama to instead pick current Fed vice chair Janet Yellen.

Obama has said he's looking for a chairman who will take ordinary people's needs into account when setting monetary policy.

"Some of my senators have been involved publicly in directing the president's attention to someone else," said Senate Majority Leader Harry Reid, D-Nev. He called Summers a long-time friend and a competent person but said the Democratic caucus will support whomever Obama picks. "He has a long list of people he's talking to," Reid said.

This is a breaking news story; updates will be added.

The Associated Press contributed to this report.

(H/T: Wall Street Journal)



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