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What's in store for Biden's economic team

Dec 03. 2020
Janet Yellen, President-elect Biden's nominee for treasury secretary, at the Jackson Hole economic symposium, sponsored by the Federal Reserve Bank of Kansas City, in Moran, Wyo., on Aug. 22, 2019. MUST CREDIT: Bloomberg photo by David Paul Morris.
Janet Yellen, President-elect Biden's nominee for treasury secretary, at the Jackson Hole economic symposium, sponsored by the Federal Reserve Bank of Kansas City, in Moran, Wyo., on Aug. 22, 2019. MUST CREDIT: Bloomberg photo by David Paul Morris.
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By Syndication Washington Post, Bloomberg · Jenny Leonard

President-elect Joe Biden on Tuesday announced the team that will take on one of the key early challenges of his presidency: keeping the U.S. economy's recovery from the coronavirus on track.

Biden's economic officials, who mostly have crisis experience from the Obama administration, will be charged with delivering more fiscal stimulus to support an economy that risks running out of steam after a rapid initial rebound from the virus slump.

The team will also be in charge of a longer-term economic plan that's a marked departure from President Donald Trump's agenda -- with a focus on boosting clean energy and domestic manufacturing, improving care for children and the elderly, and narrowing racial inequalities in income and wealth.

Those policies, like the short-term stimulus measures, face obstacles in a potentially divided Congress.

At an event in Wilmington, Delaware to introduce the group, Biden said the team will "get us through this ongoing economic crisis and help us build the economy back" better than before.

Following are snapshots of Biden's intended nominees and the tasks ahead of them. Other key officials such as secretaries of Commerce and Labor, as well as U.S. trade representative, have yet to be announced.

- Janet Yellen, Treasury Secretary. As a Federal Reserve regional president, then vice chair and chair in years before and after the 2008 financial crisis, Yellen has plenty of experience at firefighting -- and that record has won her support from both sides of the political aisle. "It's essential that we move with urgency," she said Tuesday. "Inaction will produce a self-reinforcing downturn, causing yet more devastation. And we risk missing the obligation to address deeper structural problems."

One early task may be to work with her former colleagues on the Fed's emergency lending programs for businesses and local government, some of which are due to run out at the end of this month. Current Treasury Secretary Steven Mnuchin triggered a rare public dispute with the central bank by saying that the Fed should return the money allotted as backstop for the loan facilities, instead of extending them.

Yellen will also have to navigate international disputes, especially over trade and ties with China, left behind by the Trump administration.

- Adewale "Wally" Adeyemo, Deputy Treasury Secretary. Adeyemo served in various senior economic roles in the Obama administration and represented the U.S. at international summits like the Group of 20 meetings. He'll likely be in charge of day-to-day operations at Treasury.

Under Mnuchin, the department has increasingly relied on sanctions to penalize a range of nations and senior officials. Adeyemo signaled on Tuesday there could be some continuity on this issue with the Trump administration.

At the introductory event, Adeyemo said the department will "remain laser-focused" on protecting national security, including "using our sanctions regime to hold bad actors accountable."

- Cecilia Rouse, Council of Economic Advisers Chair. Rouse, dean at Princeton University's School of Public and International Affairs, was a member of the council under Obama and worked as an economic adviser to Bill Clinton.Much of her research has focused on the need to close racial gaps in income, wealth or education. That's likely to be a priority in the design of the next pandemic stimulus program, since the burden of job losses during the coronavirus crisis has fallen disproportionately on minority groups.

The pandemic brings urgency but also offers the "opportunity to build a better economy in its wake," Rouse said Tuesday.

- Jared Bernstein, CEA member. Bernstein has long advised Biden on economic policy, both when he was vice president and during his 2020 campaign.The labor economist is an advocate for a higher federal minimum wage and a new Fed framework that would require the central bank to put more weight on indicators like the jobless rate among minority groups when setting policy. Both those ideas made their way into Biden's economic platform.

- Heather Boushey, CEA member. Boushey, a progressive economist who runs the Washington Center for Equitable Growth, has done extensive work on how to improve support for U.S. families with policies such as paid parental and sick leave.

That's likely an issue that will loom large for the Biden economic team in the short term -- since many schoolchildren are studying at home in the pandemic, putting working parents in a bind -- and also feature in the new president's longer-term commitment to designing better social safety nets.

- Neera Tanden, Office of Management and Budget director. Tanden, who worked on the Affordable Care Act under the Obama administration and was a senior aide to Hillary Clinton, is one of the few Biden picks to draw vocal criticism from congressional Republicans, who've signaled they may try to block her appointment.

As budget director she'd be tasked with navigating concerns about a rising national debt that could derail Biden's agenda. The pandemic pushed the U.S. budget deficit to $3.1 trillion this year, the biggest shortfall as a share of the economy since World War II.

Economists have generally shifted in favor of expansionary fiscal policy, especially during an emergency like coronavirus -- but Republicans in Congress, and potentially some Democrats too, could push back with calls for spending restraint.

- Brian Deese, National Economic Council. Deese, a BlackRock Inc. executive who has specialized in sustainable investment and a former Obama adviser, has been tapped by Biden to head the policy-coordinating NEC, according to people familiar with the matter, though that appointment hasn't been confirmed yet.While his Wall Street ties and past work on deficit reduction have drawn criticism from some progressive Democrats, Deese's expertise on climate policy will likely put him at the center of one of the main initiatives promised by the new administration.

A plan to invest $2 trillion in clean energy was the biggest single economic item in the Biden campaign platform. It faces a tough reception in Congress, where many Republicans are skeptical about climate change in addition to opposing big-spending government programs.

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