Goolsbee: Austan Goolsbee, President Barack Obama's new chief economic adviser, once kidded that the White House took ideas from "old textbooks, Karl Marx and Trotsky." But the real punchline is that his selection might signal a political shift to the center. He's a free trader who wants to cut business taxes and deficits -- no joke.
Goolsbee's engaging personality has already made him an effective public advocate for Obama's policies. Wall Street, however, may not find his cheekiness so amusing. When he won a "DC's Funniest Celebrity" contest last October, Goolsbee knocked bankers as "ungrateful bastards" who "bankrupted your grandma."
For that matter, the famed Goolsbee wit may also be lost on Lawrence Summers, the director of the National Economic Council. The two clashed over whether to bail out Chrysler (Summers pro, Goolsbee con), and Summers eventually tried to block Goolsbee's access to the president -- as he also did with Goolsbee's predecessor as head of the Council of Economic Advisers, Christina Romer.
But Summers' maneuvering didn't work. Obama and Goolsbee are long-time pals, having met when both taught at the University of Chicago. And Goolsbee was Obama's chief economic adviser during the 2008 presidential campaign, causing a stir when he was accused of whispering to Canadian officials that the candidate's protectionist rhetoric was just that.
Much of Goolsbee's advice, then and now, is rooted in the philosophy of the Chicago School. He is pro-market rather than pro-business, which helps explain his skepticism about the Chrysler bailout. He also thinks the current U.S. tax system makes business uncompetitive and would prefer lower corporate rates combined with fewer credits and deductions.
Beyond slotting Goolsbee into Romer's old seat, other departures are allowing Obama to reshape his economic team. The president will also have a new budget chief, deficit hawk Jack Lew, assuming the U.S. Senate confirms him. Obama will almost certainly have to contend with a more heavily Republican Congress after November's elections. With growth slow and unemployment high, it wouldn't be funny to spend the next two years gridlocked. Assuming he wants instead to find common ground, these two centrist picks make a good start.