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Wall Street ties complicate the politically touchy search for economic adviser

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Dec. 27 (Bloomberg) -- A successor to National Economic Council Director Lawrence Summers will probably be named next month, White House press secretary Robert Gibbs said on CNN's "State of the Union" program yesterday. Summers is keeping his position through the end of the year, and President Barack Obama wanted to "take some time to make a good decision," Gibbs said. Bloomberg's Peter Cook reports. (Source: Bloomberg)

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Washington Post Staff Writers
Sunday, January 2, 2011; 7:32 PM

President Obama is expected to name a new chief economic adviser as early as this week, but the months-long search process has proven difficult and politically touchy.

The departure of National Economic Council director Lawrence H. Summers, whose last day was Friday, has left a crucial vacancy in the president's inner policy circle as the economy remains his top domestic focus and shapes up to be the No. 1 issue of his 2012 reelection campaign.

Liberals in the president's base, who often criticized Summers as a symbol of the administration's closeness with Wall Street, want an NEC director who would push the White House to challenge the financial services industry and stand up to deficit hawks pushing the White House to cut programs such as Social Security. Business groups and Republican lawmakers, who have charged that the White House is hostile to corporations, want someone with practical business expertise.

And even some in the administration have suggested appointing a person with a business pedigree rather than a background primarily in academia or government.

Summers announced his departure in September. Obama asked him to remain until the end of 2010. Amy Brundage, a White House spokeswoman, said the president has considered "a number of qualified candidates" but as of Sunday had not made a decision or offered the job to anyone.

One of the leading contenders is Gene Sperling, a longtime Democratic policy guru and veteran of the Bill Clinton White House who has spent two years advising Treasury Secretary Timothy F. Geithner. But some liberals say Sperling is too close to Wall Street after being paid $887,727 in 2008 by Goldman Sachs, one of several part-time jobs he held that year. Administration officials say Sperling was paid to develop a charity that has taught business skills to women in developing countries and did no commercial work.

Another contender, Roger Altman, has strong business ties as a longtime investment banker who now runs his own firm - but liberals charge that he, too, is too close to Wall Street.

"It's a big concern when there are these high-level advisers who have been marinated in the industry," said Robert Borosage, co-director of the liberal Campaign for America's Future.

Sperling declined to comment, while a call to Altman's firm in New York, Evercore Partners, was not returned.

A third leading candidate is Richard Levin, an economist and longtime president of Yale University who also serves on the board of directors of American Express. A Yale spokesman, Robin Hogen, said Levin was declining all requests for comment on the NEC post.

"The most important qualification is finding the right person for the job who can lead the team at this pivotal time in recovery," said Brundage, the White House spokeswoman.

The criticism from the left reflects a broader tension between Obama and liberals over his economic agenda and the makeup of his policy team.


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