Summers: Trump could damage economy

Former Treasury Secretary Larry Summers, who warned his fellow Democrats that President Biden’s programs could lead to inflation, now says he’s worried that President-elect Trump’s spending and tariffs will damage the economy, The Harvard Gazette reported Monday.

“In too many ways, Democrats have lost sight of the common man and woman in favor of the attitudes and philosophies of the faculty common room,” said Summers during a talk Thursday night on why the Democrats lost the 2024 election and the risks President-elect Donald Trump’s policy plans pose for the U.S. economy.”

If President Trump does what he said he would do during his campaign, the inflation shock administered to the economy is substantially larger than anything that happened at the beginning of the last administration,” Summers said.

“He’s vowed huge deficit increases through continuation of his tax cuts and new tax cuts; he has trashed the idea of the independence of the central bank; he said that we should want to have a less highly valued currency, which means less valuable money [and] higher prices, and that’s just on the demand side,” he said.

More importantly, “He’s talked about a big tariff on every good that we import, which means higher import prices [and] also means higher prices for everything that competes with imports,” Summers said.Summers, a former president of Harvard University, noted that Vice President Kamala Harris made a pitch to voters who “love our country,” and said he’d like to see the Democratic Party and institutions like Harvard champion that.

“I’d frankly like to see it as a value embraced more in our university, where it’s not something we talk about or celebrate or think about,” he said. “There’s plenty that we have done wrong in our history. But there’s something odd about the degree to which the history that is received in our educational system is as negative about our country as it is.”

The university needs to “find a way” to encourage patriotism as a positive principle on campus because the U.S. today faces “real threats” and because it is “an alternative to each subgroup of Americans embracing a particular identity, which leads to a great deal of divisiveness,” Summers said. 

–The Hagstrom Report