Who Can Replace Larry Summers?
My view: nobody. The Obama administration is going to be weaker as a result of his forthcoming departure.
The job of Assistant to the President for Economic Policy has two components:
Making sure that the President hears and considers the arguments, and makes an informed decision.
Making sure that everybody thinks that the president has heard and considered their arguments, and made an informed decision, and that they are valued and respected members of the team who are being given due influence and deference.--and also to make sure that the president hears everybody's arguments and makes an informed decision.
Larry is superb at figuring out how to present complicated arguments to make them comprehensible to non-experts, and at setting up frameworks for discussion and debate that kept policy discussions on track and organized. That is most of the job. That is (1). And at that Larry is the best in the world.
The other part, part (2)--making sure that everybody thinks that their point of view has been given a fair shake, and that they are valued and respected measures of the team? Well, given who Larry is, he far, far exceeded expectations. Only one public shouting fight in the halls of the West Wing in two years is... quite good, really.
If I were Obama, I would (a) move Tim Geithner over to the West Wing job, for that is the job that matches his skill set where I think he would indeed by best in the world, and (b) bring Laura Tyson in to be Treasury Secretary...
Failing that, were I Obama, I would probably try to grab Alan Blinder from Princeton to fill the West Wing job...
And were I really devious, I would bring Ben Bernanke over to the West Wing and put Larry in the Fed Chair job...