Nov 15, 2020 - Politics & Policy

The economic advisers vying for gigs in Joe Biden's White House

Illustration of fingers pushing $100 bill into two divided pieces

Illustration: Eniola Odetunde/Axios

Joe Biden plans to fill his White House with economic advisers more progressive than he is, but they may be blocked from their most aggressive fiscal moves if Republicans maintain control of the Senate.

Why it matters: If the GOP keeps these progressives from winning a massive stimulus, they may be graded on a different curve: simply persuading Congress to spend more money, and relying on regulatory changes to advance Biden's broader agenda.

The big picture: Most of the advisers in contention for in-house economic positions are also more progressive than most of the candidates the president-elect is considering for Treasury secretary, sources familiar with the process tell Axios.

  • Jared Bernstein, who consistently argued for more spending and regulation as Biden’s first economic adviser in the Obama White House, is a leading candidate to run the National Economic Council.
  • Ben Harris, who replaced Bernstein in the VP's office, is more centrist but still acceptable to progressives. He could head either the National Economic Council or the Office of Management and Budget, or he could end up in a sub-Cabinet position at Treasury.
  • Heather Boushey, an economist whose research has focused on inequality, is also a possibility for the NEC, as well as the Council of Economic Advisers or the Domestic Policy Council.
  • Gene Sperling, an NEC director in both the Clinton and the Obama White Houses, has moved to the left on many issues and could return for a third tour at the Council or Management and Budget, or as a senior White House adviser.
  • Lael Brainard, a current Fed governor, appears to be the leading candidate to serve as Treasury secretary, but there are other names under consideration, including former Fed chair Janet Yellen; former Fed governor Sarah Bloom Raskin; Roger Ferguson, CEO of TIAA; and Atlanta Fed president Raphael Bostic.

Between the lines: There could be one less in-house spot for Biden's longtime advisers if he turns to academia for the top CEA job.

  • Lisa Cook, an economics professor at Michigan State, and William Spriggs, a former economics chair at Howard University, are two potential progressive Black candidates.

Two other names mentioned on the economic front, Jake Sullivan and Brian Deese, may not pass purity tests set by progressive groups like the Revolving Door Project, Demand Progress and Sunrise Movement.

  • Sullivan, a Hillary Clinton confidant who came up as a foreign policy expert, has recently focused on domestic policy and could serve as deputy chief of staff or run the NEC or the DPC.
  • Deese, who was deputy director of OMB for Obama and could return to run it, is now head of sustainable investing at BlackRock, the world's largest asset management firm.

What they're saying: Progressive are asking themselves, "Whose conversion seems sincere?" said Jeff Hauser, director of the Revolving Door Project. "Sperling is in a different place on deficits and regulation than a generation ago."

  • "Deese and Sullivan have recently worked for two politically active companies with whom progressives have deep-seated beefs, BlackRock and Uber."

President Trump showed the Biden team just how creative they can get on the stimulus side if Congress doesn’t appropriate enough money.

  • Biden is unlikely to borrow Trump’s administrative — and legally questionable — moves, like tapping FEMA funds to extend unemployment insurance or unilaterally suspending payroll taxes.
  • But Biden advisers will be forced to think big — and think differently — if he faces a hostile Senate.

Flashback: In 2010, the Obama White House jammed congressional Republicans by taking the $120 billion in tax relief they proposed to spend over two years and asked them to frontload it into a one-year payroll tax holiday.

  • Republicans took the offer and later agreed to extend the popular tax cut for another year.
  • Those kinds of negotiating tricks aren't taught in academia, a reason those with political backgrounds may get tapped.

The bottom line: Most progressive economists agree that "the president and the White House don't have many levers to pull on stimulus without Congress," said Heidi Shierholz, an economist with the Economic Policy Institute. "It's super limited."

  • But most of the potential regulatory changes to juice the economy, like waiving permitting requirements, tend to conflict with other progressive priorities, such as environmental protection.
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