Council of Economic Advisors - History

Council of Economic Advisors - History



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Op-Ed: The Ingredients for Getting the Middle Class Back on Track
The Wall Street Journal
download pdf
March 11, 2015

Inclusive Growth: The Role of Productivity, Inequality, and Participation
Bruegel
download pdf
May 11, 2016

Global Lessons for Inclusive Growth
The Institute of International and European Affairs (IIEA)
download pdf
May 7, 2014

Productivity Growth in the Advanced Economies: The Past, the Present, and Lessons for the Future
Peterson Institute for International Economics
Speech Text and Charts: download pdf
Slides: download pdf
July 9, 2015

Business Investment in the United States: Facts, Explanations, Puzzles, and Policies
Progressive Policy Institute
Speech Text and Charts: download pdf
Slides: download pdf
September 30, 2015

The New View of Fiscal Policy and Its Application
Conference: Global Implications of Europe&rsquos Redesign
download pdf
October 05, 2016

Beyond Antitrust: The Role of Competition Policy in Promoting Inclusive Growth
Searle Center Conference on Antitrust Economics and Competition Policy
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September 16, 2016

A Firm-Level Perspective on the Role of Rents in the Rise in Inequality
Event in Honor of Joseph Stiglitz: Columbia University
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October 16, 2015

Benefits of Competition and Indicators of Market Power
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April 2016
May 2016 Update: download as pdf

Labor Market Monopsony: Trends, Consequences, and Policy Responses
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October 2016

The Long-Term Decline in Prime-Age Male Labor Force Participation
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June 2016

Is This Time Different? The Opportunities and Challenges of Artificial Intelligence
New York University: AI Now Symposium
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July 7, 2016

Op-Ed: Smart Social Programs
The New York Times
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May 11, 2015

The War on Poverty 50 Years Later: A Progress Report
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January 2014
Updated Report (as it appeared in Chapter 6 of the 2014 ERP): download as pdf

The Economics of Early Childhood Investments
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December 2014
January 2015 Update: download as pdf

Economic Perspectives on Incarceration and the Criminal Justice System
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April 2016

Economic Costs of Youth Disadvantage and High-Return Opportunities for Change
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July 2015

Poverty and the Tax Code
Democracy Journal
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March 19, 2014

Thirty Years Without Fundamental Reform: Policy, Politics, and the Federal Tax Code
New York State Bar Association Tax Section
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January 26, 2016

Long-Term Interest Rates: A Survey
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July 2015

Occupational Licensing: A Framework for Policymakers
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July 2015

Barriers to Shared Growth: The Case of Land Use Regulation and Economic Rents
The Urban Institute
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November 20, 2015

The Economic Benefits of U.S. Trade
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May 2015

Explaining the U.S. Petroleum Consumption Surprise
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June 2015

The Economics of Family-Friendly Workplace Policies
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The 70 th Anniversary of the Council of Economic Advisers
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The Economic Record of the Obama Administration: Overall Economic Progress
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The Economic Record of the Obama Administration: Progress Reducing Inequality
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The Economic Record of the Obama Administration: Reforming the Health Care System
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The Economic Record of the Obama Administration: Investing in Higher Education
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The Economic Record of the Obama Administration: Strengthening the Financial System
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The Economic Record of the Obama Administration: Addressing Climate Change
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Austan D. Goolsbee

Austan D. Goolsbee served as Chairman of the Council from September 10, 2010 to August 5, 2011. Prior to serving as Chairman, Dr. Goolsbee served as a Member of the Council from March 11, 2009 to September 10, 2010. During his time at the Council, Dr. Goolsbee was on leave from his position at the University of Chicago as the Robert P. Gwinn Professor of Economics at the Booth School of Business. Dr. Goolsbee previously served as the Chief Economist and Staff Director of the President&rsquos Economic Recovery Advisory Board for the duration of its existence from 2009 to 2011.


The Full Cost of the Opioid Crisis: $2.5 Trillion Over Four Years

October 26 marked National Prescription Drug Take Back Day, which provided Americans an opportunity to prevent drug misuse and theft by ridding their homes of potentially dangerous expired, unused, and unwanted prescription drugs. One of the most tangible examples of the dangers of misusing prescription drugs comes from the opioid crisis, which the Council of Economic Advisers (CEA) estimates cost $696 billion in 2018—or 3.4 percent of GDP—and more than $2.5 trillion for the four-year period from 2015 to 2018. These massive costs point to the nationwide economic destruction from America’s very human “crisis next door.”

In 2017, CEA published a report that measured the full cost of the opioid crisis by considering the value of lost lives, as well as increases in healthcare and substance abuse treatment costs, increases in criminal justice costs, and reductions in productivity. The updated estimates for 2018 were calculated using a similar methodology as the 2017 report.

CEA’s cost estimates are more than three times higher than the findings from a recent Society of Actuaries study, because CEA accounts for the value of a statistical life (VSL). VSLs are commonly used by regulators for benefit-cost analyses and regulatory impact analyses. CEA prefers this comprehensive measure because the opioid crisis not only increases costs and lowers productivity throughout the economy, it also prematurely ends lives, which have value beyond their effect on economic output. (For more information on calculating VSL, see Section 2 of CEA’s 2017 report.)

Overdose deaths involving opioids are coming down during the Trump Administration, reversing the upward trend that has persisted since at least 1999. As displayed in Figure 1, monthly opioid-involved overdose deaths stopped their steep upward nationwide growth starting in January 2017.

Compared to the previous trend for monthly opioid-related overdose deaths, CEA estimates that almost 30,000 lives were saved from January 2017 through March 2019 (the latest available provisional data). Had this trend continued its upward trajectory, CEA estimates that the cost of the opioid crisis would have been $326 billion higher between January 2017 and March 2019.

Just as the start and growth of the opioid crisis had many causes, ending the crisis requires many solutions. Increased funding for treatment, enhanced education about the dangers of opioids, and improved security to stop the flow of illicit drugs are all necessary tools to fight the crisis. Thankfully, last year Congress passed and President Trump signed the SUPPORT Act, which is the largest legislative package addressing a single drug crisis in U.S. history.

In fiscal years 2018 and 2019, $6 billion in new funding was secured to fight opioid abuse, including to expand access to medication-assisted treatment. According to estimates from the Department of Health and Human Services (HHS), from 2016 to 2019, the number of Americans receiving medication-assisted treatment rose 38 percent, from approximately 921,000 to 1.27 million.

Aided by better education for healthcare providers and patients, there has been a nearly one-third decline in the total amount of opioids prescribed since President Trump took office through June 2019, according to HHS estimates. Importantly, nearly 60 percent fewer young adults between the ages of 18 and 25 began using heroin in 2018 than in 2016.

Another necessary component to solving the opioid crisis is securing the border to limit deadly drugs from flowing into the United States. U.S. Customs and Border Protection (CBP) nationwide seizures of fentanyl are up 265 percent over the last three fiscal years. And CBP seized enough fentanyl in fiscal year 2019 to support 10,000 fentanyl users for more than 200 years, based on typical usage. In a promising sign that these coordinated efforts are working, as of March 2019, preliminary data show year-over-year drug overdose deaths in Pennsylvania and Ohio—two of the states hit hardest by the crisis—were down from their peak levels by more than 23 percent.

Even with the decrease in opioid-related deaths under President Trump, the $696 billion cost in 2018 shows that this crisis is far from over. To help the public and policymakers understand the economic causes and costs of the opioid crisis, CEA will continue publishing reports on this critically important policy priority.

(For further reading about the economic causes of the opioid crisis, see CEA’s 2019 report The Role of Opioid Prices in the Evolving Opioid Crisis.)


Pent-Up Demand, Especially for Services

Finally, prices for many of the services most sensitive to the pandemic— such as hotels, sit-down restaurants, and air travel—have decreased due to curtailed demand stemming from consumer anxiety and public health restrictions.

As more people get vaccinated throughout the year, however, demand for these and other high-touch services could surge and temporarily outstrip supply. This surge in demand may in part be fueled by savings many households accumulated during the pandemic, as well as relief payments from the fiscal responses last year and this year. For example, Americans may have a high demand to eat out in full-service restaurants again later this year, but may find that there are fewer dining options than were open pre-pandemic. That could prompt restaurants that are still open to raise their prices. And while there are natural limits to how many services we can consume quickly—it’s generally only possible for a family to take one vacation at time, for example—Americans may still try to consume these services more frequently, or may upgrade to higher-quality versions. Economists call inflation resulting from such surges in spending demand pull inflation.

Again, we expect this to primarily be a short-term issue as businesses that shuttered or substantially reduced their services reopen, supply will increase to meet this pent-up demand. Encouragingly on this point, new business formation has picked up in recent months.


Her mother told her to take an economics class at Harvard. Now Cecilia Rouse is a history-making economic adviser to President Biden

Chair of the Council of Economic Advisers, Cecilia Rouse, spoke during a briefing at the White House May 14 in Washington, D.C. BRENDAN SMIALOWSKI/AFP via Getty Images

WASHINGTON — Cecilia Rouse, one of President Biden’s top economic advisers, almost didn’t take economics at all.

She arrived at Harvard in the fall of 1982 from Southern California with wide-ranging interests including classical flute, Israeli folk dancing, and the music of Prince — but economics initially wasn’t one of them.

Then she signed up for Ec10 for just one reason: Her mother told her to take an economics course. The first semester of abstract microeconomics lectures in musty Sanders Theatre was uninspiring.

But then the course broadened into macroeconomics, providing a broad overview after a decade plagued by recessions, gas shortages, runaway inflation, and high unemployment. When Rouse connected the concepts she was learning from professor Otto Eckstein, a former economic adviser to President Lyndon Johnson, to the troubles happening beyond Harvard’s manicured lawns, something clicked.

“I remember seeing the news about people with PhDs driving cabs because the unemployment was so high,” Rouse said, recalling, in an interview, the lingering pain of the early 1980s recession. “It just struck me that, aha, here’s a way to just think about what are the reasons why there might not be enough demand for workers.”

That revelation helped launch a career as one of the nation’s top labor economists, where she now is facing even trickier questions about unemployment as one of the key economic advisers around Biden, helping design policies to rebuild the economy after the trauma of the pandemic.

Rouse, who is chair of Biden’s Council of Economic Advisers, brings a unique background as an economist focused on inequalities in education and the workforce, including coauthoring a famous study showing that “blind auditions” conducted behind a screen increased the chances that a female musician would be hired by an orchestra.

Rouse, 57, is the first Black person to hold that job, providing economic research, analysis, and advice to Biden as he seeks to address longstanding inequalities such as the wealth gap between white and Black Americans. Biden’s commitment to that agenda, she said, was a major factor in her decision to take a leave as dean of the Princeton School of Public and International Affairs and return to Washington she also served on the Council of Economic Advisers in the Obama administration.

This time, though, the weight of the moment stood out.

“This is a moment of urgency and opportunity unlike anything we’ve faced in modern times,” she said when Biden introduced her as his nominee. “The urgency of ending a devastating crisis. And the opportunity to build a better economy in its wake — an economy that works for everyone, brings fulfilling job opportunities, and leaves no one to fall through the cracks.”

Her time in Cambridge inspired and prepared Rouse to enter a field uncommon for women, particularly Black women. But it also helped her hone a skill that continues to keep her grounded in the real world implications of economic policy: work-life balance.

Cecilia Rouse posed with her flute during her undergraduate years at Harvard. Cecilia Rouse

Two of her former roommates still marvel at how organized and steady Rouse was in college — a Rock of Gibraltar one called her — managing to have fun and be adventurous without resorting to all-nighters to excel in her classes.

“You could be talking to her about whatever problem existed in your personal life at 9:59 and at 10 p.m. she said, ‘I’m going to bed,’” said Claire Finkelstein, Rouse’s roommate all four undergraduate years and now a law and philosophy professor at the University of Pennsylvania. “She’s very much now the way she was then, which is incredibly organized, steady, paces herself.”

Rouse said her college bedtime was more like midnight, but acknowledges the broader point — that time itself is an economic constraint. That became even clearer to her as the working mother of two daughters who are now in college.

“I’ve always felt like whether it was advising Obama or President Biden, they can have many economic advisers my kids have but one mom,” Rouse said. “I’ve always put them first, but recognizing they don’t need me 24/7, I have supports in place. I’ve had flexible jobs and I’ve had enough income, so I’ve had the ability to do that and not everybody does. And I’m very aware of that.”

She said that experience helps her understand the importance of child care, universal pre-kindergarten education, paid sick leave, and affordable health insurance — all of which Biden wants to expand in his sweeping $1.8 trillion American Families Plan.

“We need to have an economic system … that recognizes that we’re human beings, we’re not automatons,” said Rouse, who is baffled by those who dispute Biden’s view that child care should count as infrastructure. “I’d just like to remind people that you really can’t go to work if someone’s not taking care of your kid.”

Education was highly valued in Rouse’s family. In 1956, her father, Carl Rouse, became just the fifth Black person nationwide — and the first at the California Institute of Technology — to earn a doctoral degree in physics. Her mother, Lorraine Rouse, earned a master’s degree in social work at the University of California, Berkeley, and became a school psychologist. Their three children all went on to earn advanced degrees.

The Rouse family sought a middle-class life, but racism loomed in the background, thwarting opportunities and changing plans. Carl Rouse was unable to get a position at a research university in the late 1960s so he took a job at General Atomics, a San Diego energy and defense company, and did astrophysics research on his own in the evenings, said Rouse’s sister, Carolyn, chair of the anthropology department at Princeton. Black people were prohibited from owning property in one San Diego suburb, Rancho Santa Fe, so the family settled in nearby Del Mar, she said.

“We grew up with a kind of patience with racism,” Carolyn Rouse said. “We have to find a way to live in this world without needing the world to change right now for us. We need to be able to be happy and enjoy life even if we can’t get the things we wish we had.”

Del Mar was a sleepy surfer town in the 1970s, Cecilia Rouse said, but she remembers seeing poverty when her family would visit Tijuana, Mexico, or travel with her father to international astrophysics conferences in places like Mexico City.

“I’m sure this comes from my parents. I’ve always been concerned about those who were not as fortunate as I was,” she said.

Rouse’s own experience with race and gender — and her laser focus on the economic inequalities they drive — have set her apart in a field long dominated by white men.

“When I first met Ceci back decades ago, there just weren’t that many what I would call progressive economists who were willing to put issues of power, of racial discrimination, of inequality into their thinking,” said Jared Bernstein, a labor economist who serves with Rouse on the Council of Economic Advisers. “What was always striking about Ceci is that she was never afraid to take that stand.”

From left, Cecilia Rouse, Claire Finkelstein, and Carolyn Stevens after moving into their Harvard dorm in the fall of 1982. Carolyn Stevens

Rouse stayed at Harvard after she graduated in 1986 to pursue her doctorate in economics, and one of her advisers was Lawrence Summers, who would go on to be a top economic adviser to President Barack Obama and recently has criticized Biden’s coronavirus rescue spending as risking high inflation. Rouse wrote her dissertation on the economic effects of attending community college rather than a traditional four-year college.

“That was very bold. People weren’t working on community colleges at the time,” said Claudia Goldin, a Harvard economics professor who was Rouse’s graduate adviser. She and Rouse then collaborated on a study that would break even more ground.

Goldin mentioned to her in passing one day that some orchestras conducted auditions with musicians hidden behind screens, to obscure their identity from those doing the hiring. Rouse, then a graduate student, jumped at the possibilities, saying that the process would be worth studying to see if it weeded out gender discrimination. It was a dicey proposition: Nobody had ever studied blind auditions, and the research could come up entirely empty.

“She recognized this was risky but she wanted to take the risk,” Goldin said.

The two spent several years seeking records from top national orchestras such as the Boston Symphony Orchestra, sending faxes, cajoling people, and traveling around the country to dig through boxes of yellowed paper files going back decades. Their research paper, published in 2000, found that the blind auditions increased the probability that a female musician would advance through the audition process and be hired.

The findings made national news and have been widely cited by other researchers, although there has been some recent criticism that the data, which Rouse and Goldin conceded in their paper had limitations, were not conclusive. Goldin said the research demonstrated Rouse’s skills: tackling important subjects, thinking outside the box, and being undeterred by difficulties.

Those are important skills in the White House. The three-member Council of Economic Advisers has been called the president’s economic think tank, providing advice based on analyzing data and research. Its past chairs include legendary economists Alan Greenspan, Ben Bernanke, and Janet Yellen. It has a more academic bent than the White House’s National Economic Council, which focuses on coordinating policymaking and implementation.

But Rouse has policy experience as well, having worked as an economist at the NEC from 1998-99. In an impressive move for a young economist, she was able to get $40 million in President Clinton’s budget for a proposal she worked on to boost college completion, said Gene Sperling, who headed the NEC at the time. That background makes her “unique and highly valued” in the White House, he said.

“She can bring the economic rigor and analysis of a leading person at the CEA, but she also can be helpful in understanding the practical policymaking challenge,” said Sperling, who is working for Biden overseeing implementation of the $1.9 trillion coronavirus rescue plan.

Now, with the nation reopening, Rouse is making the case for Biden’s plan to spend about $4 trillion on infrastructure, education, and child care over the next decade. Those proposals try to address what Rouse has studied her whole career— inequality in its various forms.

With the economy emerging from the pandemic, the next step is “to try to right the ship so we’re investing not just in tax cuts to make the wealthy wealthier,” she said of the Biden proposals she helped craft.

After decades of work spanning two elite universities and three different White Houses, Rouse thinks now might finally be the time.

Correction: An earlier version of this article misidentified Sanders Theatre.


Records of the Council of Economic Advisers [CEA]

Established: In the Executive Office of the President, by the Employment Act of 1946 (60 Stat. 24), February 20, 1946, as amended by Reorganization Plan No. 9 of 1953, effective August 1, 1953.

Functions: Recommends economic policies to the President, based on the study of all aspects of the national economy. Assists in preparing the President's economic reports to the Congress.

Finding Aids: Preliminary inventory in National Archives microfiche edition of preliminary inventories preliminary inventory available at Ford Library.

Security-Classified Records: This record group may include material that is security-classified.

Related Records: Record copies of publications of the Council of Economic Advisers in RG 287, Publications of the U.S. Government. Papers, 1974-77, of L. William Seidman, Assistant to the President for Economic Affairs and Executive Director of the Economic Policy Board (1974-77) papers, 1969-87, of Arthur F. Burns, Chairman of the Federal Reserve System Board of Governors (1970-78), in Ford Library. Papers of Bureau of the Budget official Gerhard Colm, 1937-47, containing information on establishment of CEA, in Roosevelt Library, with copies of CEA-related material in Truman Library. Papers, 1923-89, and oral history interview of Leon H. Keyserling, chairman (1950-53) papers (originals, and microfilm copies of originals at Cornell University), 1908-63, and oral history interview of Edwin G. Nourse, chairman (1946-49) papers, 1946-52, of John Davidson Clark, council member (1946-52), including an unpublished manuscript on early history of CEA papers, 1920-72, of Roy Blough, council member (1950-52) papers, 1941-52, of Robert Clemens Turner, council member (1952-53) papers, 1934-52, and oral history interview of Walter S. Salant, staff member (1946-52) oral history interview of Robinson Newcomb, staff member (1947-50), in Truman Library. (SEE ALSO Johnson Library.) General records of the Office of the CEA, 1953-61 (11 lin. ft.) general records of the Office of the Chairman, CEA, 1953-60 (6 lin. ft.) papers, 1928-69, of Arthur F. Burns, chairman (1953- 55) papers, 1938-86, and oral history interview of Raymond J. Saulnier, consultant (1953-55), council member (1955-56), and chairman (1956-61) oral history interview of Karl Brandt, council member (1958-61) electrostatic and microfilm copies of papers, 1952-63, of Neil H. Jacoby, council member (1953-55) papers, 1954-62, of John Stewart Bragdon, staff member (1954-55), in Eisenhower Library. (SEE ALSO Johnson Library.) Papers (some originals and microfilm copies of other originals), 1940-71, and oral history interview of Walter W. Heller, chairman (1961-64) papers, 1937-76, and oral history interview of Kermit Gordon, council member (1961-62) papers, 1955-67, of James Tobin, council member (1961-62) copies of CEA press releases, 1961-63 group oral history interview of former CEA officials (Hugh) Gardner Ackley, Kermit Gordon, Walter W. Heller, Paul Samuelson, Joseph A. Pechman, and James Tobin, in Kennedy Library. (SEE ALSO Johnson Library). Microfilm copies, made at conclusion of Johnson administration, of CEA council and staff member files, 1961-68 (78 reels) oral history interview of Leon H. Keyserling, chairman (1950-53) copy (original at Columbia University) of oral history interview of Raymond J. Saulnier, consultant (1953-55), council member (1955- 56), and chairman (1956-61) microfilm copies (originals at University of Michigan) of papers, 1962-68, and oral history interview of (Hugh) Gardner Ackley, chairman (1964-68) papers, 1948-80, and oral history interview of Arthur M. Okun, chairman (1968-69) oral history interview of Joseph A. Pechman, consultant (1961-68) oral history interview of Charles L. Schultze, staff member (1952-58) oral history interview of Kermit Gordon, council member (1961-62) papers, 1967-68, and oral history interview of Walter W. Heller, chairman (1961-64) papers, 1964-65, of Otto Eckstein, council member (1965-66), in Johnson Library. (SEE ALSO Truman, Eisenhower, and Kennedy Libraries.)

Note: CEA records created during the administration of President Jimmy Carter were designated Presidential materials, and were donated by him to the Carter Library. They constitute approximately 275 lin. ft. of as yet incompletely processed records, 1977-81.

Note: The CEA has usually maintained a decentralized recordkeeping system, with each council and staff member keeping his or her own files. From 1946 to 1976, such files were considered to be the personal property of their creator. Many council and staff members who served during that period donated their files to the appropriate Presidential library. In September 1976, during the Presidential administration of Gerald Ford, the incumbent CEA council and staff members collectively offered their files to the National Archives for accessioning as federal records. The National Archives, in accepting the offer, established this record group and allocated the records to the Ford Library.

459.2 OFFICIAL FILES OF CHAIRMAN ALAN GREENSPAN
1974-77
25 lin. ft.

History: CEA consists of three members, appointed by the President with Senate approval. One of the members serves as chairman by Presidential appointment. Staff members and temporary consultants assist the three council members.

Textual Records: General correspondence, 1974-76. Subject correspondence, 1974-76. Correspondence with the White House, 1974-77 and federal agencies, 1974-76. Internal memorandums and reports, 1974-76. Minutes of the Economic Policy Board, with background material, 1974-76. Copies of the chairman's speeches, statements, and Congressional testimony, 1974-76. Correspondence relating to the chairman's participation in conferences and other professional events, 1974-76.

459.3 OFFICIAL FILES OF COUNCIL MEMBERS
1969-77
46 lin. ft.

459.3.1 Official files of Gary Seevers

Textual Records: General correspondence, 1973-75. Subject correspondence, 1971-75. Correspondence with federal agencies, 1969-75. Administrative correspondence, 1969-73. Correspondence and reports relating to Seevers's participation in conferences and other professional events, 1972-75. Information copies of the chairman's memorandums to the President, 1973-74.

459.3.2 Official files of William Fellner

Textual Records: General correspondence, 1974-75. Subject files, 1972-75. Copies of Fellner's speeches and statements, 1973-75.

459.3.3 Official files of Paul McAvoy

Textual Records: General correspondence, 1975-76. Subject correspondence, 1970-76. Correspondence with the White House, 1974-76 and federal agencies, 1975-76. Correspondence, memorandums, and reports relating to McAvoy's participation in interagency committees and task forces, 1973-76. Correspondence relating to McAvoy's participation in conferences and other professional events, 1975-76.

459.3.4 Official files of Burton Malkiel

Textual Records: General correspondence, 1975-77. Subject correspondence, 1975-77. Correspondence relating to Malkiel's participation in conferences and other professional events, 1975- 76.

459.4 OFFICIAL FILES OF STAFF MEMBERS
1973-77
16 lin. ft.

Textual Records: Memorandums, reports, and other records of individual staff members, documenting their work in such policy areas as energy, food and agriculture, transportation, tax revenues, and international finance, 1973-77.

Bibliographic note: Web version based on Guide to Federal Records in the National Archives of the United States. Compiled by Robert B. Matchette et al. Washington, DC: National Archives and Records Administration, 1995.
3 volumes, 2428 pages.

This Web version is updated from time to time to include records processed since 1995.


Council of Economic Advisers

The Council of Economic Advisers (CEA) is a United States agency within the Executive Office of the President established in 1946, which advises the President of the United States on economic policy. [2] The CEA provides much of the empirical research for the White House and prepares the publicly-available annual Economic Report of the President. [3]

Activities

Economic Report of the President

The report is published by the CEA annually in February, no later than 10 days after the Budget of the US Government is submitted. The president typically writes a letter introducing the report, serving as an executive summary and used for press coverage. The report proceeds with several hundred pages of qualitative and quantitative research by reviewing the impact of economic activity in the previous year, outlining the economic goals for the coming year (based on the President's economic agenda), and making numerical projections of economic performance and outcomes. Public criticism usually accompanies its release, sometimes attacking the importance placed or not placed on particular data or goals. The data referenced or directly used in the report are from the Bureau of Economic Analysis and U.S. Bureau of Labor Statistics. [ citation needed ]

History

Establishment

The Truman administration established the Council of Economic Advisers via the Employment Act of 1946 to provide presidents with objective economic analysis and advice on the development and implementation of a wide range of domestic and international economic policy issues. It was a step from an "ad hoc style of economic policy-making to a more institutionalized and focused process". The act gave the council the following goals:

1. to assist and advise the President in the preparation of the Economic Report

2. to gather timely and authoritative information concerning economic developments and economic trends, both current and prospective, to analyze and interpret such information in the light of the policy declared in section 2 for the purpose of determining whether such developments and trends are interfering, or are likely to interfere, with the achievement of such policy, and to compile and submit to the President studies relating to such developments and trends

3. to appraise the various programs and activities of the Federal Government in the light of the policy declared in section 2 for the purpose of determining the extent to which such programs and activities are contributing, and the extent to which they are not contributing, to the achievement of such policy, and to make recommendations to the President with respect thereto

4. to develop and recommend to the President national economic policies to foster and promote free competitive enterprise, to avoid economic fluctuations or to diminish the effects thereof, and to maintain employment, production, and purchasing power

5. to make and furnish such studies, reports thereon, and recommendations with respect to matters of Federal economic policy and legislation as the President may request. [4]

In 1949 Chairman Edwin Nourse and member Leon Keyserling argued about whether the advice should be private or public and about the role of government in economic stabilization. [5] Nourse believed a choice had to be made between "guns or butter" but Keyserling argued for deficit spending, asserting that an expanding economy could afford large defense expenditures without sacrificing an increased standard of living. In 1949, Keyserling gained support from Truman advisors Dean Acheson and Clark Clifford. Nourse resigned as chairman, warning about the dangers of budget deficits and increased funding of "wasteful" defense costs. Keyserling succeeded to the chairmanship and influenced Truman's Fair Deal proposals and the economic sections of NSC 68 that, in April 1950, asserted that the larger armed forces America needed would not affect living standards or risk the "transformation of the free character of our economy." [6]

1950s–80s

During the 1953–54 recession, the CEA, headed by Arthur Burns deployed non-traditional neo-keynesian interventions, which provided results later called the "steady fifties" wherein many families stayed in the economic "middle class" with just one family wage-earner. The Eisenhower Administration supported an activist contracyclical approach that helped to establish Keynesianism as a possible bipartisan economic policy for the nation. Especially important in formulating the CEA response to the recession—accelerating public works programs, easing credit, and reducing taxes—were Arthur F. Burns and Neil H. Jacoby. [7]

Until 1963, during its first seven years the CEA made five technical advances in policy making, including the replacement of a "cyclical model" of the economy by a "growth model," the setting of quantitative targets for the economy, use of the theories of fiscal drag and full-employment budget, recognition of the need for greater flexibility in taxation, and replacement of the notion of unemployment as a structural problem by a realization of a low aggregate demand. [8]

The 1978 Humphrey–Hawkins Full Employment Act required each administration to move toward full employment and reasonable price stability within a specific time period. It has been criticized for making CEA's annual economic report highly political in nature, as well as highly unreliable and inaccurate over the standard two or five year projection periods. [9]

1980–present

Since 1980, the CEA has focused on sources of economic growth, the supply side of the economy, and on international issues. [5] In the wake of the Great Recession of 2008–2009, the Council of Economic Advisers played a significant role in supporting the American Recovery and Reinvestment Act. [10]

Organization

The council's chairman is nominated by the president and confirmed by the United States Senate. The members are appointed by the president. As of July 2017, the Council's 18 person staff consisted of a chief of staff (Director of Macroeconomic Forecasting), 15 economists (5 senior, 4 research, 4 staff economists, 2 economic statisticians) and 2 operations staff. [11] Many of the staff economists are academics on leave or government economists on temporary assignment from other agencies. [10]

Composition

Chairs

Officeholder Term start Term end President(s)
Edwin G. Nourse August 9, 1946 November 1, 1949 Harry Truman
Leon Keyserling
Acting: 1949–1950
November 2, 1949 January 20, 1953
Arthur F. Burns March 19, 1953 December 1, 1956 Dwight Eisenhower
Raymond J. Saulnier December 3, 1956 January 20, 1961
Walter Heller January 29, 1961 November 15, 1964 John F. Kennedy
Lyndon Johnson
Gardner Ackley November 16, 1964 February 15, 1968
Arthur M. Okun February 15, 1968 January 20, 1969
Paul W. McCracken February 4, 1969 December 31, 1971 Richard Nixon
Herbert Stein January 1, 1972 August 31, 1974
Gerald Ford
Alan Greenspan September 4, 1974 January 20, 1977
Charles Schultze January 22, 1977 January 20, 1981 Jimmy Carter
Murray Weidenbaum February 27, 1981 August 25, 1982 Ronald Reagan
Martin Feldstein October 14, 1982 July 10, 1984
Beryl W. Sprinkel April 18, 1985 January 20, 1989
Michael J. Boskin February 2, 1989 January 20, 1993 George H. W. Bush
Laura Tyson February 5, 1993 February 21, 1995 Bill Clinton
Joseph Stiglitz June 28, 1995 February 13, 1997
Janet Yellen February 18, 1997 August 3, 1999
Martin N. Baily August 12, 1999 January 20, 2001
Glenn Hubbard May 11, 2001 February 28, 2003 George W. Bush
Greg Mankiw May 29, 2003 February 18, 2005
Harvey S. Rosen February 23, 2005 June 10, 2005
Ben Bernanke June 21, 2005 January 31, 2006
Edward Lazear February 27, 2006 January 20, 2009
Christina Romer January 28, 2009 September 3, 2010 Barack Obama
Austan Goolsbee September 10, 2010 August 5, 2011
Alan Krueger November 7, 2011 August 2, 2013
Jason Furman [12] August 2, 2013 January 20, 2017
Kevin Hassett [13] September 13, 2017 June 28, 2019 Donald Trump
Tomas J. Philipson
Acting
June 28, 2019 June 23, 2020
Tyler Goodspeed
Acting
June 23, 2020 January 7, 2021
Cecilia Rouse March 12, 2021 Incumbent Joe Biden

Members

    1946–1953
  • Roy Blough 1950–1952 1950–1953
  • Robert C. Turner 1952–1953 1953–1955 1953–1955 1954–1956 1953–1955 1955–1958 1956–1959 1958–1961 1959–1961 1961–1962 1961–1962 1963–1964 1964–1966 1966–1968
  • Merton J. Peck 1968–1969
  • Warren L. Smith 1968–1969 1969–1971 1969–1971 1971–1973 1972–1973
  • Gary L. Seevers 1973–1975 1973–1975
  • Paul. W. MacAvoy 1975–1976 1975–1977 1977–1979 1977–1980 1979–1981 1980–1981 1981–1985 1981–1982 1982–1985
  • Thomas Gale Moore 1985–1989 1986–1988 1989–1991 1989–1991 1991–1993 1991–1993 1993–1994 1993–1995 1995–1996 1996–1997 1997–1999 1998–1999 1999–2001 2000–2001 2001–2002 2001–2003 2003–2005 2003–2005 2005–2007 2005–2007 2008–2009 2009–2011 2011–2012 2011–2013 2013–2014 2013–2015 2014–2015
  • Jay Shambaugh 2015–2017 2015–2017 2017–2019 2017–2020 2019–2021 2021–present 2021–present

References

  1. ^ abWage and Price Controls Encyclopedia.com n.d.
  2. ^Council of Economic Advisers
  3. ^
  4. "Economic Report of the President". govinfo.
  5. ^
  6. "History of the CEA". The White House . Retrieved 4 May 2021 . ( Public domain)
  7. ^ abRemarks by Chairman Alan Greenspan. Receipt of the Truman Medal for Economic Policy. Before the Truman Medal Award and Economics Conference, Kansas City, Missouri October 26, 2005, Council of Economic Advisers website under President Bush
  8. ^ Brune 1989
  9. ^ Engelbourg 1980
  10. ^ Salant 1973
  11. ^ Cimbala and Stout 1983
  12. ^ ab
  13. Flickenschild Michael, Afonso, Alexandre (2018). "Networks of economic policy expertise in Germany and the United States in the wake of the Great Recession". Journal of European Public Policy. 26 (9): 1292–1311. doi: 10.1080/13501763.2018.1518992 . CS1 maint: multiple names: authors list (link)
  14. ^Council of Economic Advisers. Staff Whitehouse.gov, n.d. accessed 29 July 2017
  15. ^
  16. "Obama names Furman as new White House chief economist", Reuters, 2013-06-10
  17. ^
  18. "Senate Confirms Kevin Hassett as Chairman of the President's Council of Economic Advisers", The Wall Street Journal, 2017-09-12

Sources

  • Brazelton, W. Robert (2001), Designing U.S. Economic Policy: An Analytical Biography of Leon H. Keyserling, New York: Palgrave, ISBN0-333-77575-9
  • Brazelton, W. Robert (1997), "The Economics of Leon Hirsch Keyserling", Journal of Economic Perspectives, 11 (4): 189–197, doi: 10.1257/jep.11.4.189 , ISSN0895-3309
  • Brune, Lester H. (1989), "Guns and Butter: the Pre-Korean War Dispute over Budget Allocations: Nourse's Conservative Keynesianism Loses Favor Against Keyserling's Economic Expansion Plan", The American Journal of Economics and Sociology, 48 (3): 357–371, doi:10.1111/j.1536-7150.1989.tb03189.x, ISSN0002-9246
  • Cimbala, Stephen J. Stout, Robert L. (1983), "The Economic Report of the President: Before and after the Full Employment and Balanced Growth Act of 1978", Presidential Studies Quarterly, 13 (1): 50–61, ISSN0360-4918
  • Eizenstat, Stuart E. (1992), "Economists and White House Decisions", Journal of Economic Perspectives, 6 (3): 65–71, doi:10.1257/jep.6.3.65, ISSN0895-3309
  • Engelbourg, Saul (1980), "The Council of Economic Advisers and the Recession of 1953–1954", Business History Review, 54 (2): 192–214, doi:10.2307/3114480, ISSN0007-6805, JSTOR3114480
  • Flickenschild, Michael, Afonso, Alexandre (2018), "Networks of economic policy expertise in Germany and the United States in the wake of the Great Recession", Journal of European Public Policy, 26 (9): 1292–1311, doi: 10.1080/13501763.2018.1518992 , ISSN1466-4429
  • Leeson, Robert (1997), "The Political Economy of the Inflation-unemployment Trade-off", History of Political Economy, 29 (1): 117–156, doi:10.1215/00182702-29-1-117, ISSN0018-2702
  • McCaleb, Thomas S. (1986), "The Council of Economic Advisers after Forty Years", Cato Journal, 6 (2): 685–693, ISSN0273-3072
  • Norton, Hugh S. (1977), The Employment Act and the Council of Economic Advisers, 1946–1976, Columbia: University of South Carolina Press, ISBN0-87249-296-6
  • Salant, Walter S. (1973), "Some Intellectual Contributions of the Truman Council of Economic Advisers to Policy-making", History of Political Economy, 5 (1): 36–49, doi:10.1215/00182702-5-1-36, ISSN0018-2702
  • Sobel, Robert (1988), Biographical Directory of the Council of Economic Advisers, New York: Greenwood Press, ISBN0-313-22554-0
  • Tobin, James Weidenbaum, Murray, eds. (1988), Two Revolutions in Economic Policy: The First Economic Reports of Presidents Kennedy and Reagan , Cambridge: MIT Press, ISBN0-262-70034-4
  • Wehrle, Edmund F. (2004), "Guns, Butter, Leon Keyserling, the AFL-CIO, and the Fate of Full-employment Economics", Historian, 66 (4): 730–748, doi:10.1111/j.1540-6563.2004.00094.x, ISSN0018-2370, S2CID143607377

External links

  • Official website
  • Economic Report of the President:
      White House on FRASER, St. Louis Federal Reserve US Gvt United States Government Publishing Office

  • From our September 2016 issue

    Check out the full table of contents and find your next story to read.

    Were a Council of Historical Advisers in place today, it could consider precedents for numerous strategic problems. For example: As tensions increase between the U.S. and China in the South and East China Seas, are U.S. commitments to Japan, the Philippines, and other countries as dangerous to peace as the 1839 treaty governing Belgian neutrality, which became the casus belli between Britain and Germany in 1914?

    The council might study whether a former president’s handling of another crisis could be applied to a current challenge (what would X have done?). Consider Obama’s decision to strike an imperfect deal to halt or at least delay Iran’s nuclear program, rather than bombing its uranium-enrichment plants, as Israeli Prime Minister Benjamin Netanyahu hoped he might. Obama’s deliberations have significant parallels with Kennedy’s decision during the Cuban missile crisis to strike a deal with Nikita Khrushchev, rather than invading Cuba or learning to live with Soviet missiles off Florida’s coast.

    A president might also ask the council “what if?” questions. What if some action had not been taken, or a different action had been taken? (These questions are too seldom asked after a policy failure.) In this spirit, the next president could ask the council to replay 2013. What if Obama had enforced his “red line” against the Assad regime, rather than working with Russia to remove Syrian chemical weapons? Was this decision, as critics maintain, the biggest error of his presidency? Or was it, as he insists, one of his best calls?

    Finally, the council might consider grand strategic questions, including perhaps the biggest one of all: Is the U.S. in decline? Can it surmount the challenges facing it, or will American power steadily erode in the decades ahead?

    Both Hillary Clinton and Donald Trump offer answers to these questions. Indeed, Trump proposes to “make America great again,” implying that decline has already occurred, and to put “America first,” reviving a slogan with, to put it mildly, a problematic history. The presidential campaign thus far gives us little confidence that America’s history deficit is about to be closed.

    We suggest that the charter for the future Council of Historical Advisers begin with Thucydides’s observation that “the events of future history … will be of the same nature—or nearly so—as the history of the past, so long as men are men.” Although applied historians will never be clairvoyants with unclouded crystal balls, we agree with Winston Churchill: “The longer you can look back, the farther you can look forward.”


    Leadership

    This table provides a list of chairs of the Council of Economic Advisers from 1981 to 2021. Α] Β]

    Chairs of the Council of Economic Advisers, 1981-2021
    Chair Tenure Administration
    Cecilia Rouse 2021-Present Joe Biden
    Kevin Hassett 2017-2019 Donald Trump
    Jason Furman 2013-2017 Barack Obama
    Alan Krueger 2011-2013 Barack Obama
    Austan Goolsbee 2010-2011 Barack Obama
    Chrisina Romer 2009-2010 Barack Obama
    Edward Lazear 2006-2009 George W. Bush
    Ben Bernanke 2005-2006 George W. Bush
    Harvey Rosen 2005 George W. Bush
    N. Gregory Mankiw 2003-2005 George W. Bush
    R. Glenn Hubbard 2001-2003 George W. Bush
    Martin N. Baily 1999-2001 Bill Clinton
    Janet Yellen 1997-1999 Bill Clinton
    Joseph Stiglitz 1995-1997 Bill Clinton
    Laura D'Andrea Tyson 1993-1995 Bill Clinton
    Michael Boskin 1989-1993 George H.W. Bush
    Beryle Sprinkel 1985-1989 Ronald Reagan
    Martin Feldstein 1982-1984 Ronald Reagan
    Murray Weidenbaum 1981-1982 Ronald Reagan


    Watch the video: The Yom Kippur War: How Israel Turned the Tide Part 2. History of Israel Explained. Unpacked