Washington Babylon — December 19, 2008, 9:43 am

Correction on Larry Summers/Managed Funds Association

I posted an item a few weeks ago about Obama’s top White House economics adviser, Lawrence Summers, and the Managed Funds Association (MFA), the leading lobbying organization for the hedge fund industry. I had noted that before taking his new job, Summers had resigned as a managing director of hedge fund D.E. Shaw & Co., which is a member of the MFA.

An official involved with the MFA called and asked me to correct and clarify a few points from the story, which I’m in late in getting to.

I wrote that the MFA “was founded last year and since then has spent about $3.5 million lobbying the federal government,” and that its priorities include blocking regulation of the hedge fund industry. The spending on lobbying is correct, but the MFA has been around a lot longer: it was established in 1991.

Furthermore, the MFA, the official told me, has not opposed all regulation on the industry or derivatives. The MFA did oppose an SEC proposal a few years ago that would have required hedge fund managers to register as investment advisors. But the official said that the Association has asked for more regulation of derivatives. (He said that D.E. Shaw, Summers’s old firm, is registered with the SEC and not all MFA members are opposed to requiring fund managers to register.)

Also, the official said my article suggested that Summers himself played a role at the MFA, when in fact he had no connection to the organization. My article didn’t state that but I can see how a reader could draw that conclusion.

I regret the errors or any misperceptions caused by the item. I do think, though, that the broader points of the story hold: The hedge fund industry has a good deal of political influence and it needs to be further regulated and subject to greater public scrutiny (as the current crisis makes clear). And that Summers’s political history, general economic ideas and business ties suggest that he’ll be friendly to the hedge fund industry.

Share
Single Page

More from Ken Silverstein:

From the November 2013 issue

Dirty South

The foul legacy of Louisiana oil

Perspective October 23, 2013, 8:00 am

On Brining and Dining

How pro-oil Louisiana politicians have shaped American environmental policy

Postcard October 16, 2013, 8:00 am

The Most Cajun Place on Earth

A trip to one of the properties at issue in Louisiana’s oil-pollution lawsuits 

Get access to 164 years of
Harper’s for only $39.99

United States Canada

CATEGORIES

THE CURRENT ISSUE

August 2014

The End of Retirement

= Subscribers only.
Sign in here.
Subscribe here.

The Octopus and Its Grandchildren

= Subscribers only.
Sign in here.
Subscribe here.

Francis and the Nuns

= Subscribers only.
Sign in here.
Subscribe here.

Return of the Strongman

= Subscribers only.
Sign in here.
Subscribe here.

view Table Content

FEATURED ON HARPERS.ORG

Post
“From the nerd squabbles of Internet discussion threads rose an urban legend that culminated in a film that hinges on digging through my town’s trash.”
Illustration (detail) by Timothy Taranto
Article
Return of the Strongman·

= Subscribers only.
Sign in here.
Subscribe here.

“If Tunisia is where the Arab Spring began, Egypt seems poised to become its burial ground.”
Photograph (detail) © Ahmed Ismail / Getty Images
Article
The Seductive Catastrophe·

= Subscribers only.
Sign in here.
Subscribe here.

“The world’s leaders were moved by a populace fused into a forward phalanx, were shaken by a tidal wave of militancy jubilantly united.”
Photograph courtesy Mary Evans Picture Library
Article
Me, Myself, and Id·

= Subscribers only.
Sign in here.
Subscribe here.

“The one defining trait of the narcissist is that it’s always someone else.
Painting (detail) by Gianni Dagli Orti
Post
The Many Faces of Boko·

= Subscribers only.
Sign in here.
Subscribe here.

“People want education. Open a school and they will rush.”
Photograph © The author

Average number of sitcom laughs an American hears during a prime-time season:

12,000

Czech and German deer still do not cross the Iron Curtain.

British economists correlated the happiness of a country’s population with its genetic resemblance to Danes.

Subscribe to the Weekly Review newsletter. Don’t worry, we won’t sell your email address!

HARPER’S FINEST

In Praise of Idleness

By

I hope that after reading the following pages the leaders of the Y. M. C. A. will start a campaign to induce good young men to do nothing. If so, I shall not have lived in vain.

Subscribe Today