Fiscal and Economic Policy: Making Ends Meet Won't Be Easy

TREASURY DEPARTMENT

Having ridden into his second term in large part on the strength of the national economy, Clinton was hardly likely to dump Secretary Rubin.

Rubin, the low-key former investment banker who was, early in the President's first term, head of the NEC, has won points for keeping the Administration focused on deficit reduction and for his adroit handling of various potential crises, from a falling dollar to the Mexican bailout. When House Republicans refused to raise the debt limit to pressure Clinton during last year's budget standoff, Rubin's deft maneuvering allowed the government to keep paying its bills anyway, and to keep the presssure on the House.

Rubin wants to stick around for the entitlement reforms he considers key to continued deficit reduction, and to prove the economic Cassandras wrong about an impending recession. He'll also focus on pet projects: finding new ways to channel capital to inner cities, rolling out his promised new inflation-indexed bonds and using the bully pulpit to exhort spendthrift Americans to save more.

NATIONAL ECONOMIC COUNCIL

With director Laura D'Andrea Tyson headed back to Berkeley, Calif., some analysts say the NEC is at a crossroads. The council is supposed to coordinate the Administration's economic policy making, and Tyson's critics faulted her for not doing enough to prevent end runs to the President by Cabinet members.

``The President has to decide, does he want the NEC to be restored to the role it had in its first two years under [Treasury Secretary and former NEC head] Rubin?'' a trade lobbyist said. ``That is not a question of structure, that's a question of personality and the perception of who is head of it.''

Candidates to replace Tyson include deputy national security adviser Berger and Tyson's two deputies: Gene B. Sperling and Daniel K. Tarullo. Still another name that's been bandied about for the top NEC slot: Princeton University economist Alan S. Blinder, former vice chairman of the Federal Reserve and a onetime colleague of Tyson's on Clinton's Council of Economic Advisers (CEA). Along with good managerial skills, Blinder would bring a track record as an economic popularizer--he once wrote a monthly column for Business Week. But he's not a political heavy-hitter, which some argue is a vital quality for anyone who wants the NEC to have a central role in policy making. If CEA chairman Joseph E. Stiglitz moves on, Blinder could well be a candidate for that job.

OFFICE OF MANAGEMENT AND BUDGET

By all appearances, OMB is a happier place these days. That's because for the first time since the beginning of the Administration, Panetta is out of the picture. Though much admired, the former OMB director and White House chief of staff was first and foremost a political animal. And that, some at OMB thought, got in the way of a budget agreement.

Franklin D. Raines, who in September was confirmed as OMB's latest director, ``is re-energizing the place,'' an analyst who's familiar with the agency's operation said. Not that Raines's immediate predecessor, Alice M. Rivlin, wasn't highly regarded and capable. But she always had Panetta looking over her shoulder and negotiating for her. ``Leon is a brilliant budgeter, but he's a politician,'' the source said. Raines, a former vice chairman of the Federal National Mortgage Association and an OMB figure during the Carter Administration, has already called for early budget talks involving both ends of Pennsylvania Avenue.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Going Agile:Revolutionizing Federal Digital Services Delivery

    Here’s one indication that times have changed: Harriet Tubman is going to be the next face of the twenty dollar bill. Another sign of change? The way in which the federal government arrived at that decision.

    Download
  • Cyber Risk Report: Cybercrime Trends from 2016

    In our first half 2016 cyber trends report, SurfWatch Labs threat intelligence analysts noted one key theme – the interconnected nature of cybercrime – and the second half of the year saw organizations continuing to struggle with that reality. The number of potential cyber threats, the pool of already compromised information, and the ease of finding increasingly sophisticated cybercriminal tools continued to snowball throughout the year.

    Download
  • Featured Content from RSA Conference: Dissed by NIST

    Learn more about the latest draft of the U.S. National Institute of Standards and Technology guidance document on authentication and lifecycle management.

    Download
  • GBC Issue Brief: The Future of 9-1-1

    A Look Into the Next Generation of Emergency Services

    Download
  • GBC Survey Report: Securing the Perimeters

    A candid survey on cybersecurity in state and local governments

    Download
  • The New IP: Moving Government Agencies Toward the Network of The Future

    Federal IT managers are looking to modernize legacy network infrastructures that are taxed by growing demands from mobile devices, video, vast amounts of data, and more. This issue brief discusses the federal government network landscape, as well as market, financial force drivers for network modernization.

    Download
  • eBook: State & Local Cybersecurity

    CenturyLink is committed to helping state and local governments meet their cybersecurity challenges. Towards that end, CenturyLink commissioned a study from the Government Business Council that looked at the perceptions, attitudes and experiences of state and local leaders around the cybersecurity issue. The results were surprising in a number of ways. Learn more about their findings and the ways in which state and local governments can combat cybersecurity threats with this eBook.

    Download

When you download a report, your information may be shared with the underwriters of that document.