Obama Appoints Berkeley Professor Christina Romer to Chair Council of Economic Advisers

Christina Romer, of UC Berkeley, has been appointed to Chair President Elect Obama's Council of Economic Advisers. Romer wrote, if not the book, at least the chapter for Encyclopedia Britannica on the Great Depression [pdf]. News of her appointment should make liberals and women who opposed the appointment of Lawrence Summers, who many predicted (including today's Wall Street Journal) would get this job, somewhat happy, though it looks like Summers will be named White House economic director. Professor Romer and her husband David were both advisers to the Obama campaign and they hold two seats on the committee which decides when the U.S is officially in a recession.

The Romers are macroeconomists, who study the big picture in economics. They've also studied the way tax cuts affect the economy and government spending. A UC Berkeley article reported:

"What they found about both issues surprised them. Tax cuts provide powerful short-run stimulus to the economy, but there is little evidence that tax cuts restrain government spending.

It turns out," Christina explains, "that tax cuts have led, eventually, to tax increases. Basically, something has to give. What we thought gave when you cut taxes was spending, but we seem to find that in postwar U.S. history what actually gives is the tax cut itself. A substantial fraction of a tax cut is typically undone in the subsequent five years."

The appointment may telegraph Obama's intentions regarding Fed Reserve Chair Ben Bernanke. Romers wrote a paper, "Choosing the Federal Reserve Chair: Lessons from History" [pdf]. Like Bernanke, she has a history of a connection to Princeton University, where she was an assistant professor from 1985-1988.

Romer graduated from College of William and Mary in 1981 and from M.I.T., with a Ph.D., in 1985. In 1994, she co-authored, with her husband, a paper, "What Ends Recessions?"

It's clear, Obama is appointing someone smart, with strong academic credentials. Unlike Treasury Secretary appointee Geither, who is overflowing with experience, Romer is an academic who's specialized in "getting" the big picture.

Related:
Christina Romer: Obama's Chair Of The Council Of Economic Advisers

Originally posted at OpEdNews.com

Comments

[Lionsden]

The reason there were no spending cuts to match the increase of revenue provided by tax cuts is because democrats refuse to stop spending. It does not take a PhD to figure this out.

If by change, Obama means that democrats will stop taking from the "rich" and give to the poor then I'm for that kind of change.

If by change, Obama means that democrats will stop acquiring power by bribing the poor with handouts, then I'm for that kind of change.

Wise leaders in D.C. would be a welcome change.

[walk0nwalls]

Well i'm glad to see her on the team let's try to make less mistakes from here on out.

[Daniel74]

An intellectual! AAAHHHH! Don't we need more leadership "from the gut"? ;-) An administration that will be able to hold discussions with international leaders, instead of giving them unsolicitated and unwelcome back rubs! What a concept!

[twofish]

So with these folks on board, why is Obama shifting his position on getting rid of the Bush tax cuts for the rich? Or is this more BS from the MSM? What I remember hearing is that he'll wait to discuss that with his economic advisors. Given the background of most of them, that doesn't give me a warm, fuzzy feeling.

[itsthemedication]

UC Berkley! Finally I'm happy with a pick, although the bit about tax cuts followed by tax increases was not exactly earth shaking news. The Democrats put the house in order and the Republicans have a frat party. Even I can see that one...

[pupbayer]

Hmmm...not a Clinton veteran and not from Chicago. She's from Alton, IL over 200 miles from Chicago...a very adventurous pick for Obama.

[Masong]

it's great having a better and stonger team.

[grata2ude]

Isn't it great to watch Obama putting together a team we can have confidence in?

[BarackstarObama]

Absolutely, I love seeing all of the Ivy League and West coast schools on most of his choices' resumes.

[MysticInd]

And what does she have to say about Ameros?

[Centaur]

I find it absolutely refreshing that our soon to be President (wish it was now)continues to find the best and the brightest minds around. I, for one, am not surprised by this. Without a doubt, President Obama will get this country back on track

[Erdgeist]

I hope that Christina Romer has learned the important lessons of the Great Depression. I don't think Nixon did or even Bill Clinton or George W. Bush.

As I see it, for the last 35 or more years Presidents have more or less promoted the economic interests of the superclass aimed at increasing profits by waging war on the wages of the middle and lower class through such schemes as globalization and free-trade. To emphasize my point, Nike, for example, which is headquartered in Beaverton, Oregon, produces virtually all of its products outside of the U.S. in low wage countries -- not in the U.S. This is an outrage.

I hope that Christina Romer has the courage to tell President Obama that we can't continue with the economic policies of the last 35 years which have decimated the wages of the middle and lower class. Something has to be done to bring back domestic manufacturing and good wages otherwise the Great Depression will haunt us again in a newer more savage form.

[Carolab]

All anyone need do is look at the Reagan administration and the Bush administration to see that tax cuts lead eventually to tax increases. What happened under Clinton in the first term was that he had to raise taxes in order to offset the losses incurred under Reagan's tax cuts. Reagan found that tax cuts left shortfalls in paying for necessary domestic programs, and Greenspan told him to steal from the Social Security fund so that it would not increase the deficit.

[canucklivinginUSA]

Dude, Christine, stop making me love you more! Geez, some people are trying to hard to get my affections. I am not that hard to please

[sjmillstein]

Holy crap, Romer was my professor like two years ago! I took Intro to Economics with her - she was fantastic, extremely knowledgeable, and quite friendly. This is exciting news.

[ron ray]

Have to concur, what is the point here? that Obama, like clinton, will listen to the eggheads and drop his plans for a middle class tax cut?

I remember clinton doing that in 1992. the gop took congress away at the very next election.