Austan Goolsbee, one of President Obama’s most trusted economic advisers, said Monday night that he would resign, marking the latest departure from the president’s economic team at a time when the nation’s jobs recovery is slowing.
Goolsbee, chairman of the Council of Economic Advisers since September, is leaving to preserve his tenured professorship at the University of Chicago. Goolsbee stopped teaching at the university in 2007, when he began to advise Obama’s presidential campaign. The school rarely allows professors to take more than two years of leave.
His departure comes as Obama confronts an increasingly tepid economic recovery. Goolsbee, who is regarded as one of the administration’s most effective speakers on economic policy given his background as a star lecturer, spent Friday answering questions about the unexpected news that the economy added only 54,000 jobs in May as the unemployment rate inched back up to 9.1 percent.
Goolsbee, 41, has often had the ear of Obama, urging the president to adopt more of a market-driven approach to economic policymaking. He got to know the president at the university, where Obama taught law before running for the Senate in 2004.
A member of the council since the beginning of the administration, Goolsbee replaced the first chairman, Christina Romer, who argued strongly last year that the White House needed to spend government money to stimulate the economy. Goolsbee has maintained that the private sector must drive the economy’s growth now that the recession has passed.
“Since I first ran for the U.S. Senate, Austan has been a close friend and one of my most trusted advisers,” Obama said Monday night. “Over the past several years, he has helped steer our country out of the worst economic crisis since the Great Depression.”
Goolsbee’s departure further elevates the profile of Treasury Secretary Timothy F. Geithner, who is the only original member of the president’s economic team to endure.
Geithner now is a principal force shaping Obama’s thinking on the deficit, financial regulation, unemployment, Middle East sanctions and China. Geithner’s former counselor, Gene Sperling, directs the National Economic Council.
Obama’s relationship with Goolsbee, which has been nurtured over many years, is far more personal than his relationship with Geithner. But Geithner impressed the president with his strategy that helped rescue the financial system in 2009 and 2010.
As the political winds have grown more turbulent for Obama, Goolsbee and Geithner have come to the fore as Obama’s more pragmatic and less ideological advisers.
Over the past year, Lawrence H. Summers resigned as National Economic Council director to return to Harvard University; Peter Orszag left as budget director and eventually joined Citigroup; and Jared Bernstein, Vice President Biden’s economic adviser, left to join a Washington think tank.
Like Summers, Romer, Bernstein and Orszag, Goolsbee is an economist.
With no economist in a prominent position, the White House is likely to nominate another academic this summer to head the Council of Economic Advisers, after Goolsbee returns to Chicago, where he taught for 14 years.
“While I am looking forward to returning home to Chicago, I will always be proud of the years I have spent working for this president,” Goolsbee said. “I believe that his judgment, his courage in confronting the worst economic crisis of our lifetimes, and his commitment to the American people have made a tremendous difference for the nation.”
Despite the recent bad news on jobs, Obama credited Goolsbee with helping to lay the groundwork for the nation’s economic recovery. The economy has added nearly 2 million jobs during the Obama administration.
“Although there is still much work ahead, his insights and counsel have helped lead us toward an economy that is growing and creating millions of jobs. He is one of America’s great economic thinkers,” Obama said.
At the White House, Goolsbee has been an advocate for letting the market drive administration policies such as housing and the auto bailout. He opposed the rescue of Chrysler and has expressed skepticism about allowing the government to continue to play a large role in housing finance.
Obama has not always hewed to Goolsbee’s view but has made sure to consider his perspective, even before he became chairman.
Goolsbee has also influenced administration policy on technology, taxes, small business and patents.
Around Washington, Goolsbee was known as an effective communicator of economic policy and gave many of the White House’s “whiteboard” lectures on its Web site. He gave stand-up comedy performances around town.
In addition to chairing the council, Goolsbee was the staff economist for the president’s outside economic panel in the first two years of the administration and has been a liaison to the business community.