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Why The Jason Furman Hire Confuses People

Apropos of John Judis's post on Jason Furman, and a lot of other commentary in that vein, it's not at all clear that Furman is to the right of the economists Obama has been relying on for advice. As Ezra Klein points out, he's certainly not to the right of Austan Goolsbee, who'd previously been (and basically still is) Obama's leading economic adviser. I think people get confused here because, as a member of the Clinton administration's neoliberal contingent, and thanks to his more recent work at the Robert Rubin-affiliated Hamilton Project, Furman is closely associated with the more centrist side of various Washington policy debates. On the other hand, because Goolsbee hasn't spent years toiling away as a Washington wonk, his worldview doesn't map as neatly onto the neoliberal/paleoliberal divide that burns so brightly here.

From the point of view of a concerned labor-liberal, though, someone with Furman's pedigree should actually be preferable to someone with Goolsbee's. As Jonathan Cohn noted yesterday, there aren't many Washington neoliberals who haven't had to re-think their worldview over the last seven years, in light of mounting evidence that prosperity isn't being distributed very evenly and that the economic risks facing middle-class people are escalating. This is absolutely topic A in Washington economic circles, whereas someone at the University of Chicago Business School--even someone as sharp and enlightened as Goolsbee--would probably be a little more insulated from it.*

P.S. Also, don't miss Paul Krugman's point: Furman was hired to be the director (i.e., broker, coordinator, explainer, synthesizer, etc.) of economic policy, not the chief policy-maker...

*Don't get me wrong--academic economists talk about this stuff quite a bit. And they tend to talk about it a lot more precisely than we do in Washington. But the volume and reach of the discussion at a place like Chicago--or even more policy-oriented places like Harvard--probably doesn't match what goes on in Washigton, if only because the typical economics department explores a much broader range of questions (even if the questions themselves are pretty narrow).

Update: If you're thinking through how these positions would translate into jobs in an Obama administration, I'd guess Furman would be the guy you'd install as head of the National Economic Council (the policy coordination body--i.e., what Gene Sperling did in Clinton's second term) and Goolsbee would be the guy you'd want to head the Council of Economic Advisers (the administration's in-house think-tank--i.e., what people like Joe Stiglitz did for Clinton).    

--Noam Scheiber