Labor economist to join Obama advisers

WASHINGTON -- Facing a public deeply dissatisfied with his handling of the economy, President Barack Obama on Monday tapped a prominent labor economist to join his cadre of advisers and help steer a fall jobs agenda that will be critical to the president's re-election bid.

In nominating Alan Krueger as chairman of the White House Council of Economic Advisers, Obama gains an economist with expertise in the labor market and unemployment, a key drag on the U.S. economy and Obama's presidency. Krueger, a former Treasury Department official and Princeton University economist, has advocated for hiring tax credits for businesses and increased government spending on infrastructure, two programs Obama aides are considering proposing this fall.

His appointment also caps a wholesale makeover of Obama's economic leadership team during the past year. Several high-ranking advisers, including Lawrence Summers, Christina Romer and Austan Goolsbee, have all left the administration, leaving Treasury Secretary Timothy Geithner as the only top official remaining from the president's original economic team.

Obama has often reached within his administration's ranks to fill vacant posts on the economic team, and Krueger is no exception. Though he spent last year at Princeton, he served as assistant secretary for economic policy at the Treasury Department during the first two years of Obama's administration.

Gregory Mankiw, a former CEA chairman under President George W. Bush and longtime acquaintance of Krueger, said Obama's new nominee has a reputation as an analytic, data-driven economist, not as a champion for many specific policy initiatives.

While Mankiw said he believes Krueger is highly qualified for the post, he doesn't expect him to push the administration in any new directions when it comes to tackling the nation's economic and unemployment woes.

"This is more of a continuity appointment rather than a move-in-a-new-direction appointment," said Mankiw, now an economics professor at Harvard University. "I don't think the president wanted a change. He's keeping the basic structure of the team in place."

White House spokesman Jay Carney brushed off questions Monday about whether Krueger would bring any fresh job creation ideas to the White House, saying only that the president's nominee was the best person for the job.

Obama announced Krueger's nomination at a Rose Garden ceremony Monday morning and said he would rely on the economist for unvarnished guidance, not partisan political advice.

"That's more important than ever right now," Obama said. "We need folks in Washington to make decisions based on what's best for the country, not what's best for any political party or special interest."

If confirmed by the Senate, Krueger will join a White House grappling for ways to boost sluggish economic growth and bring down an unemployment rate stuck stubbornly above 9 percent. Republican presidential hopefuls are traveling around the country, campaigning hard for the GOP nomination by focusing squarely on Obama's handling of the economy. And an already anxious public is growingly increasingly frustrated.

Obama has promised to outline a new round of jobs initiatives next week. But it's unclear whether anything he proposes could improve the economy short-term.

The president has already called for an extension of a payroll tax cut that expires at the end of the year and to continue jobless benefits. Aides are considering other measures, including tax incentives for businesses to hire and direct infusions of government money into construction projects.

Obama has also said he intends to call for additional long-term deficit reduction to help pay for the short-term spending his proposals would require.

He said Monday that his jobs initiatives will be "the kind of proposals that everybody can get behind, no matter what your political affiliation might be."

The White House said Krueger would not play a role in shaping the proposals Obama will outline next week because his nomination will still be awaiting confirmation.

Krueger is likely to become an important public face for the administration on the economy. Both Romer and Goolsbee, Obama's two previous CEA chairs, were frequent spokesmen for the president, appearing on television and at White House events to promote the president's policies.

The CEA is a three-member panel created in 1946 to analyze and interpret economic development, as well as recommend economic policies. Council members typically come from academic, not political, backgrounds.