WANTED: Brilliant economist. Must be politically savvy, trusted by Wall Street, a strong leader and consensus builder, cool in a crisis, able to calm world markets with a few words and likely to guide the economy into robust health in time for the 2008 presidential election.
In other words, someone to succeed Federal Reserve Chairman Alan Greenspan, who indicated at a recent Capitol Hill hearing -- for the first time publicly -- that he intends to step down from one of Washington's most powerful jobs when his Fed board term expires in late January 2006.
(Ray Lustig -- The Washington Post)
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The 78-year-old chairman's silent, affirmative nod to a lawmaker's question instantly elevated "Who Will Succeed Greenspan?" from a longtime Washington parlor game to among the most important outcomes of the presidential race.
The succession issue may land on the next president's desk soon after Inauguration Day on Jan. 20, one year and 11 days before Greenspan's term ends. With the stakes so high, the next administration will want to plan early for a smooth transition, according to people close to the campaigns and candidates. President Bush's administration started compiling names of possible successors more than two years ago.
In interviews with more than a dozen people who follow the Fed closely, a virtually unanimous consensus existed about the leading contenders. The sources -- economists and political operatives on Wall Street and in Washington -- generally spoke on condition that they not be named because they know one or more of the candidates and expect to work in the future with whoever is chosen.
Bush's list of candidates is likely to start with Harvard economist Martin S. Feldstein, 64, and Columbia Business School Dean R. Glenn Hubbard, 46, both of whom are highly respected within academic circles and the White House, these observers say.
Feldstein served in the Reagan administration as chairman of the White House Council of Economic Advisers and is considered the father of "supply side" economics -- the belief that cutting taxes stimulates economic growth -- because of his pioneering research on how taxes affect business and consumer behavior.
Hubbard was CEA chair in the first years of the current Bush administration and is described by colleagues as the architect of many of the president's tax cut policies, particularly the proposal to eliminate taxes on many stock dividends.
A Kerry victory would likely mean Robert E. Rubin, 66, chairman of Citigroup Inc.'s executive committee and Treasury secretary during the Clinton administration, gets the right of first refusal, say several people close to Rubin and the Kerry campaign. Rubin, who was prominently seated next to Kerry's wife at the Democratic convention, has been a frequent critic of Bush's economic policies. If he didn't want the Fed job himself, he would have a strong say over whom Kerry considers, these observers said.
After Rubin, the next likely Democrat is Harvard President Lawrence H. Summers, 49, a top economist who worked closely with Rubin in the Clinton Treasury Department before succeeding him as secretary.
