September 17, 2019

Lew to Complete Change of Obama’s Economic Team

Mr. Obama called Mr. Lew “a master of policy who can work with membes of both parties and forge principled compromises.”

If confirmed by the Senate, Mr. Lew, 57, would become just the second Treasury secretary for Mr. Obama, succeeding Timothy F. Geithner, who at the president’s insistence stayed for the entire first term.

Mr. Geithner, formerly president of the New York Federal Reserve Bank and a top Treasury official in the Clinton administration, was the last remaining principal from the original Obama economic team that took office at the height of the global financial crisis in January 2009.

Mr. Lew, in brief remarks, did not address the looming challenges of the job, saying only that he looked forward to leading a Treasury staff that he called “legendary for their skill and knowledge.”

Mr. Geithner, who received a warm send-off, said his successor was “committed to defending the safety net for the elderly and the poor,” a reference to programs like Medicare, Social Security and Medicaid, which are under intense pressure in the long-running fiscal negotiations.

Mr. Lew also “understands what it takes to create the conditions for economic growth,” he added.

While the team is changing, so far it is made up entirely of men who have been part of the administration since its first months. Gene Sperling, like Mr. Lew a veteran of the Clinton administration and the partisan budget wars of that era, is expected to remain as director of the White House National Economic Council. Alan B. Krueger, a former Treasury economist, will continue as chairman of the Council of Economic Advisers and Jeffrey D. Zients, a former business executive, remains for now as acting director of the Office of Management and Budget, though Mr. Obama is said to want to promote him to another job.

That composition gives Mr. Obama a high degree of comfort with his economic advisers, who have experience in the budget struggles that have occupied the administration since Republicans took control of the House two years ago. Those struggles will resume later this month. Yet the continuity also plays into criticism that the president is too insular and insufficiently open to outside voices and fresh eyes in the White House.

If Mr. Lew is confirmed in time, his first test as Treasury secretary could come as soon as next month, when the administration and Congressional Republicans are expected to face off over increasing the nation’s debt ceiling, which is the legal limit on the amount that the government can borrow. Mr. Obama has said he will not negotiate over raising that limit, which was often lifted routinely in the past, but Republican leaders have said they will refuse to support an increase unless he agrees to an equal amount of spending cuts, particularly to entitlement programs like Medicare and Social Security.

Mr. Lew was passed over for Mr. Obama’s economic team four years ago, when Mr. Obama instead chose Lawrence H. Summers, a former Harvard University president and Treasury secretary in the Clinton administration, as director of the National Economic Council. Hillary Rodham Clinton then hired Mr. Lew at the State Department when she became secretary, and in late 2010 — over the objections of Mrs. Clinton, who had come to rely on Mr. Lew — Mr. Obama made him budget director, the same post Mr. Lew had held late in the Clinton administration.

Mr. Lew in the 1980s was a Democratic adviser to the House speaker at the time, Thomas P. O’Neill Jr., participating in fiscal talks with the Reagan administration. Mr. Lew is known for his low-key style and organizational skills.

While Mr. Lew has much less experience than Mr. Geithner in international economics and financial markets, he would come to the job with far more expertise in fiscal policy and dealing with Congress than Mr. Geithner did. That shift in skills reflects the changed times, when emphasis has shifted from a global financial crisis to the budget fights with Republicans in Congress.

John H. Cushman Jr. contributed reporting.

Article source:

White House Debates Fight on Economy

Mr. Obama’s senior adviser, David Plouffe, and his chief of staff, William M. Daley, want him to maintain a pragmatic strategy of appealing to independent voters by advocating ideas that can pass Congress, even if they may not have much economic impact. These include free trade agreements and improved patent protections for inventors.

But others, including Gene Sperling, Mr. Obama’s chief economic adviser, say public anger over the debt ceiling debate has weakened Republicans and created an opening for bigger ideas like tax incentives for businesses that hire more workers, according to Congressional Democrats who share that view. Democrats are also pushing the White House to help homeowners facing foreclosure.

Even if the ideas cannot pass Congress, they say, the president would gain a campaign issue by pushing for them.

“The president’s team puts a premium on being above the partisan fray, which is usually the right strategy,” said Senator Charles E. Schumer of New York, the No. 3 Democrat in the Senate. “But on this issue, when he knows what the right thing to do is, and when a rather small group on one side is blocking any progress, you have to be willing to call that group out if you want to get anything done.”

Dan Pfeiffer, the White House director of communications, said that there was no internal debate. “The president’s first priority is to work with Republicans and Democrats to grow the economy, create jobs and reduce the deficit, but if the Republican House continues its ‘my way or the highway’ approach, he will make sure the public knows who is standing in the way and why.”

The issue is being framed by the 2012 election. Administration officials, frustrated by the intransigence of House Republicans, have increasingly concluded that the best thing Mr. Obama can do for the economy may be winning a second term, with a mandate to advance his ideas on deficit reduction, entitlement changes, housing policy and other issues.

Mr. Obama plans to spend time this weekend considering his options, advisers said. The White House expects to unveil new job-creation proposals in early September.

The ailing economy, barely growing at the same pace as the population, has swept all other political issues to the sidelines. Twenty-five million Americans could not find full-time jobs last month. Millions of families cannot afford to live in their homes. And the contentious debate over raising the federal debt ceiling — which Mr. Obama achieved only after striking a compromise with Republicans that included a plan for at least $2.1 trillion in spending cuts over 10 years — has further shaken economic confidence.

Republicans contend that the Obama administration has mismanaged the nation’s recovery from the 2008 financial crisis. Mr. Obama’s political advisers are struggling to define a response, aware that their prospects may rest on persuading voters that the results of the first term matter less than the contrast between their vision for the next four years and the alternative economic ideas offered by Republicans.

So far, most signs point to a continuation of the nonconfrontational approach — better to do something than nothing — that has defined this administration. Mr. Obama and his aides are skeptical that voters will reward bold proposals if those ideas do not pass Congress. It is their judgment that moderate voters want tangible results rather than speeches.

“If you’re talking about a stunt, I don’t think a stunt is what the American people are looking for,” the White House press secretary, Jay Carney, told reporters on Wednesday. “They’re looking for leadership, and they’re looking for a focus on economic growth and job creation.”

Article source: