Before a packed ballroom of real estate investors in downtown Philadelphia on Tuesday night, President Obama’s top economic advisor defended the White House’s economic program and attacked Senate Republicans for stalling financial reform legislation.
Speaking at the Spring Members’ Meeting for the Zell/Lurie Real Estate Center at the Wharton School, Larry Summers mounted a vigorous defense of last year’s nearly $800 billion stimulus bill.
“The economic environment today looks very different than it did a year ago,” Summers told attendees as they finished off a dinner of mixed baby greens, seared red snapper, and chocolate pate. “Today the market is robust. The credit market has normalized. And most observers expect more jobs to be created over the next several months.”
Summers credited the economic stimulus legislation for the improved economic outlook. “At least a preliminary judgment is that public policy was responsible because policy makers made the right diagnosis,” he said.
The former treasury secretary and Harvard president also spoke at length about President Obama’s plan to increase government regulation of Wall Street. Summers attacked Republicans, although not by name, for not allowing the legislation to be debated or voted upon.
“Twice, on a party-line vote, the Senate refused to even discuss financial reform,” Summers claimed, perhaps unaware that Democrat Ben Nelson of Nebraska also voted against cloture on the measure. “A determined minority wants to block this reform unless they can negotiate a compromise in a darkened room, with nobody watching.”
Summers spoke for more than an hour inside the ballroom at the historic Rittenhouse Hotel in downtown Philadelphia.
During a question and answer session following his remarks, Summers was asked about the White House’s inaccurate forecasts about employment with and without the president’s economic stimulus bill. He claimed that while the initial forecast correctly estimated GDP growth, it underestimated what turned out to be unusually strong productivity growth. According to Summers, that assumption was responsible for the incorrect employment forecasts promoted by the White House.