Larry Summers gave his first local speech since leaving the White House yesterday. He began his address by joking that Washington, DC, offered a respite from the brutal politics of Cambridge. He ended it indulging a question about that Facebook movie. And in between the two, President Obama’s former economic adviser told a room full of Boston business leaders that capitalism as we’ve known it is irreparably broken.
Summers was an early advocate of federal economic stimulus, and yesterday, he defended massive government interventions in the economy, saying, “It was better to err on the side of doing too much to protect the economy, than to do too little.” He added that, when a historic economic freefall stopped, “it didn’t happen because of self-equilibrating markets. The laws of supply and demand weren’t working.”
The end of the crash doesn’t mean things will snap back to normal, he said. Instead, Summers argued that we’re entering an era when the traditional demarcation lines between government, business and nonprofits have to shift and, in some cases, overlap.
Televisions are cheap and food is plentiful, he said, so “by the traditional economic models, we’re doing very well.” However, he added, “that’s only a part of what people need. What people are looking to the economy for are goods where the economics of Adam Smith are less relevant.” Those goods include design, research, education, infrastructure, and health care. “Fiscal and monetary policy cannot make a country rich, prosperous, or inclusive. That depends on energy and creativity of citizens, and the support they receive from their government.”
Sounding much like his former boss, Summers argued that improvements in technology, combined with the high cost of health care and education, were fueling a spike in inequality. “There are more opportunities for the people in this room, but they’re coming at the expense of those who compete with the people making less in the rest of the world,” he said. The question for policymakers shouldn’t be whether government is overreaching in health care or education, he argued. Instead, the debate should be, “Did we educate everyone in a way that they’ll be able to participate in the modern economy and compete on the strength of their minds? Or did we allow the gap between the children of the affluent and poor to increase for another generation?”
–PAUL MCMORROW
BEACON HILL
A key codefendant in former House speaker Sal DiMasi‘s corruption case will enter a guilty plea in federal court today. Prosecutors are recommending a lighter sentence – two to three years – in exchange for the plea from Joseph Lally, who also will agree to testify against DiMasi and two other codefendants. WBUR posts a copy of Lally’s plea deal. David Frank, a reporter at Massachusetts Lawyers Weekly, discusses the case with Jim Braude on NECN’s Broadside.
Gov. Deval Patrick completed the first day of his five-day trade mission to Israel with no immediate deals to announce, but proclaimed the relationship building that’s going on a key to growing jobs in “this new innovation economy,” the Globe reports.
House Speaker Robert DeLeo still says he’s optimistic about passing casino gambling legislation – a statement that elicits mockery and sarcasm from state and municipal officials.
WASHINGTON IN BOSTON
US Sen. Scott Brown pens an op-ed in today’s Globe in the form of a letter to President Obama on the occasion of his visit here today. Jobs, debt, and a deficit of trust are the three big problems facing the country, says Brown. Light on substance, but that hardly matters as Brown continues to burnish his image as a key bipartisan player.
Former Gov. Mitt Romney, who usually takes his bylined pieces past the local media and to the Wall Street Journal and New York Times, takes to the pages of the Boston Herald to debut something he’s calling the Obama Misery Index.
WASHINGTON
US Secretary of Commerce Gary Locke, a key figure in the fishing dispute that has roiled the Bay State, will be nominated to serve as the next US ambassador to China. He replaces Jon Huntsman, who is likely to make a bid for the Republican presidential nomination.
A group of senators has launched a national road show to win public support for federal spending cuts.
Sen. Rand Paul talks to liberal elitist Jon Stewart.
ELECTION 2012
Rick Santorum bowls ‘em over in Iowa.
Scott Brown thanks billionaire David Koch for his support, and asks for more funds for his re-election effort.
Sex-scandal-wracked Sen. John Ensign won’t seek reelection – a move that could help the GOP hold his Nevada seat, and advance its march on the Senate.
Donald Trump ’s maybe-campaign for president is already in legal trouble.
NATIONAL POLITICS
What’s keeping Florida Gov. Rick Scott from joining the likes of ascendant Republican governors Scott Walker, Mitch Daniels and Chris Christie? Squabbles with his own party, for one.
MUNICIPAL MATTERS
The New England Farm Workers Council buys a historic theater to help revitalize downtown Springfield.
Chicopee plans to work on an ordinance that would prohibit people from going through trash.
City Councilor Michael Young in Haverhill says Mayor James Fiorentini is stonewalling him on spending information, the Eagle-Tribune reports.
The Massachusetts Life Sciences Center is giving a $300,000 grant to Lynn Vocational Technical High School to launch a CSI-style training program, the Item reports.
Amesbury has halted a plan to demolish its 170-year-old town hall annex.
HEALTH CARE
Massachusetts public employee unions, trying to get out ahead of demands to rein in outsized benefit packages, yesterday unveiled a proposal they save will save the public money on public employee health care, but critics labeled the plan potentially worse than the status quo. A Boston Herald editorial rips the proposal as a “compromise in name only.”
After offering up the union health care plan, AFL-CIO boss Robert Haynes does his best to run away from Margery Eagan.
ENERGY AND ENVIRONMENT
Boston and Quincy officials will hold a public meeting Thursday to discuss a proposed joint project to erect and cash in on a 400-foot turbine on Moon Island.
The controversy over two proposed Brewster wind turbines could move to the courts.
MEDIA
The Chronicle of Philanthropy highlights a study by the Knight Foundation, part of a $24 million commitment to fund community journalism, that shows people who regularly stay informed and read the news are more likely to be active members of their local communities.
EDUCATION
State education secretary Paul Reville explains the thinking behind “innovation schools” in a MetroWest Daily News column.
Parents and the ACLU are asking the Swampscott School Committee to delay a new drug policy that would apply all year long, not just when school is in session, the Salem News reports.
Longer school hours and increased teacher training are now working at two Lawrence middle schools, so dozens of teachers have been notified that they could be reassigned in September.
Students at UMass Amherst decry strict student conduct code.
The superintendent of schools in Green Bay takes the same job in Marblehead at a starting salary of $179,000, about $7,000 less than his predecessor, the Salem News reports.
HOMELESSNESS
The state has ordered a Brockton motel to seal all its windows and is launching a review of all motels that shelter families after a toddler fell out a second-story window, the Brockton Enterprise reports.
VOTING
In US News & World Report, Susan Milligan rips a move in New Hampshire to take away voting rights for out-of-state students, and worries it could spread to other states where there are more and bigger colleges and universities.
CORRECTIONS
Jenny Phillips, a Concord psychotherapist, is on “Greater Boston” with Scott Harshbarger to talk about her fascinating documentary, “The Dhamma Brothers.” The film highlights an intense meditation and yoga program for hardened lifers at a maximum prison in Alabama. Phillips and Harshbarger discuss whether the controversial but successful Buddhist approach can be brought to prisons here.
PUBLIC SECTOR UNIONS
WBUR’s On Point discusses Wisconsin and labor relations with two reporters and Steven Greenhouse, author of The Big Squeeze.
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