Nor has Summers ever admitted that the Commodity Futures Modernization Act of 2000, often cited as one of his main achievements as Treasury secretary, led directly to the financial crash, a conclusion of the FCIC report. Summers's sponsorship of the act was the culmination of his long fight to prevent the regulation of derivatives trading. Channeling the views of Wall Street, he believed that even a hint of regulation would send all derivatives trading overseas, costing America business. (It was the unspoken assumption in those years that what was good for Wall Street was good for the U.S. economy, and vice versa.) When Brooksley Born, then the chairwoman of the Commodity Futures Trading Commission, devised a 1998 proposal suggesting that over-the-counter derivatives be regulated, he called her, livid. Although she did not report to him, he dressed her down loudly. Born's deputy, Michael Greenberger, says he walked in as the call was ending. "She was ashen," he recalls. "She said, 'That was Larry Summers. He was shouting at me.' "
Summers told Born that a group of bankers had come to his office to say it did enormous damage to their business just for her to raise these questions, and he let her know she should just stop doing it. Born later said, "I was astonished a position would be taken that you shouldn't even ask questions about a market that was many, many trillions of dollars in notional valueand that none of us knew anything about."
Even after the financial crash of 2008, Summers did not relent in his view that little else could have been done back then, despite the FCIC's report and other studies that concluded otherwise. Summers's boss and mentor, then-Treasury Secretary Robert Rubin, conceded during the post-crash hearings in 2010 that Born was "right about derivatives regulation." Even former President Clinton later admitted he should have reined in derivatives trading.
