WORLD> America
Obama taps heavyweights to help economy out of 'vicious cycle'
(Agencies)
Updated: 2008-11-25 08:03

Landing a job on the White House staff instead of a Cabinet level appointment means that Summers will avoid a possibly contentious Senate confirmation hearing that could dredge up questions over controversial comments he made in 2005 about gender differences while he was president of Harvard University. Women’s groups circulated complaints about Summers, and the issue could have been a distraction for an already strapped Obama economic team.

U.S. President-elect Barack Obama (L) follows his economic policy team after a news conference in Chicago, November 24, 2008. From left, are: Obama, Treasury Secretary-designate Timothy Geithner, Council of Economic Policy-designate Christina Romer, and National Economic Council Director-designate Lawrence Summers. [Agencies]

Still, Summers has a reputation as a masterful economist and, as a protégé of Robert Rubin, his predecessor as Treasury Secretary, the selection of Summers signals a strong centrist orientation of the Obama team. Summers was an early and aggressive supporter of economic stimulus to stave off recession, indicating a likely emphasis of the Obama team on aggressive government intervention in the markets.

“Summers will be the power behind the throne on fiscal policy,” said Greg Valliere, chief political strategist at Stanford Financial Group. “I think it’s going to be a pretty good division of labor.”

The Obama plan to spend billions of additional taxpayer dollars in a stimulus package that includes significant new spending on infrastructure is winning cautious approval from Wall Street observers, mainly because it will create jobs in America.

“You can’t import a bridge from China; it has to be built in America with American workers,” said Joe Lieber, senior vice president of Washington Analysis, a financial consulting firm.

“You’re probably going to see Wall Street react favorably to this stimulus proposal.”

Inside the Hilton Chicago hotel, President-elect Obama stood at a wooden podium bearing the sign “The office of the President Elect.” Eight American flags were affixed in the background.

Obama’s economic team entered the room first, followed by Vice President-elect Joe Biden, and, lastly, Obama. The president-elect delivered prepared remarks then took questions from reporters.

Obama cited Geithner’s experience with the financial markets, particularly global ones. “The reality is that the economic crisis we face is no longer just an American crisis, it is a global crisis,” Obama said.

He praised Summers as “a thought leader,” saying his intellect and experience will help shape his administration’s economic policy.

Obama said his team will be coming up with a stimulus plan, more details of which Obama said he will outline to Congress and to the nation in coming weeks. And sounding a grim note, Obama said, “We have to do whatever is required to keep the financial system working.”

But showing that the president-elect can maintain a sense of humor even in the face of the brutal economic reality, reporters’ seats at the news conference were divided into a White Sox section - to the South - and a Cubs section - to the North of the ballroom. Obama is a rabid White Sox fan. (For what it’s worth, Politico was in the Cubs section. We’re not sure what that means).

Reporters began setting up before 7 a.m. for the 11 p.m. news conference. There were about 150 members of the news media in the main room and additional press in an overflow room outside the Continental Ballroom C, where Obama spoke.

Obama and Biden also named Christina Romer Chair of the Council of Economic advisors, and named Melody Barnes and Heather Higginbottom to serve as Director and Deputy Director of the Domestic Policy Council.