Here's Larry Summers in his Peterson Institute speech on July 17th, reminding all of us that while we may forget how bad things were, the prescient minds of the Obama economic braintrust were fully aware:
"The combination of complexity of the economy and the quality of human nature — which for evolutionary reasons smoothes over excruciating memories to make us all happier — has led to a situation where people forget just how close to the edge the economy was last fall and early this winter."
And here's what Summers had to say on the topic on "Meet the Press" Sunday:
"Six months ago, the economy was in a nose dive, people were talking about the possibility of another depression, the statistics all suggested a vertical decline." And yet, "things were much worse than we thought."
Did they know or didn't they? Did they design a stimulus targeted with full awareness that the economy was in "freefall"? Or did they miss the mark because things were worse than they knew? Wasn't he one of those "people" saying we were at the abyss? Wasn't that the reason for the universe's largest stimulus ever?
Were we to expect an immediate jolt, or was the stimulus appropriately back-ended?
Save or create?
Middle-class tax hikes on the table or off the table?
It doesn't matter.
The rhetoric, the Obama White House presumes, is merely to fill the air and to get through the news cycle. Say what you have to say today and deal with the contradictions and consequences later... or don't, because by then circumstances will have changed, another news cycle will have begun, and everyone will have forgotten...
But while the tactic works for the hip three-minute ditties of sugar-sweet pop songs, it has damaging consequences for the credibility of economic policy-making — both for the Administration generally, and for Larry Summers, specifically.
For the Obama Administration, they'll find that four years is a long time, words do matter, and they come back to haunt you. The "hook", as with pop songs, wears off after a while. Failing the rhetorical credibility test is how you lose the public and send confusing signals to markets, where consistency counts.
For Larry Summers, the cost will probably be more personal. For six months now we have been watching Dr. Summers' otherwise brilliant economic mind (just ask him) poured into the Obama Administration's rhetorical jelly mold.
The real art of Fed-speak is to say a little, but to mean a lot, but never to sing to someone else's tune. And it's not an art form we'll see Larry Summers practice.
Whatever the hook, on that you can rely.
Tony Fratto is a CNBC on-air contributor and most recently served as Deputy Assistant to the President and Deputy Press Secretary for the Bush Administration.