Obama's Economic Go-to Guy

By Sam Pizzigati, Too Much: A Commentary on Excess and Inequality. Posted March 12, 2008.

How progressive a President could Barack Obama be? Could he be as transformational as Franklin Roosevelt, whose dozen White House years downsized America's rich and helped usher onto the global stage the first mass middle class in world history? Or will the Obama years more likely end up, as Bill Clinton's did, as a timid intermission between two plutocrat-friendly acts of conservative Republican dominance?

Austan Goolsbee, outside Obama himself, just might have more of an impact on the answer than any other individual in the Obama camp. Goolsbee, a 39-year-old University of Chicago business school prof, has emerged as Obama's top economic adviser.

With Senator Obama closing in on the Democratic nomination -- and the U.S. economy tottering on the brink of big-time trouble -- progressive analysts have begun looking Goolsbee's way. And many don't particularly like what they see.

Are these analysts seeing clearly? Or might Goolsbee, the odds-on choice to chair the Council of Economic Advisers in an Obama administration, actually nudge public policy in a decent direction?

Goolsbee's brief public policy career, at first glance, appears to offer precious little reason for progressive optimism. Goolsbee defines himself as "a centrist market economist," and everyone else seems to have locked in on that exact same characterization.

The Chicago Tribune, for instance, describes Goolsbee as a business prof "with centrist Democratic views" who's firmly "anchored in dominant market-oriented economic thought." U.S. News and World Report last month discussed how Obama "has surrounded himself with centrist economic advisers, like the frustratingly reasonable Austan Goolsbee." Business Week, also last month, labeled Goolsbee the leader of a Obama economics brain trust packed with "generally careful technocrats."

The thought of a centrist technocrat whispering sweet mainstream nothings into a President Obama's ear has already begun generating waves of angst among veteran progressive observers. American Prospect editor Robert Kuttner, for one, considers Goolsbee and his fellow centrist advisers "free-market guys who want to use markets to somehow solve social problems, which is like squaring a circle."

Much of what Goolsbee has written over recent years supplies ample fuel for such angst. Goolsbee can come across as remarkably ivory-towerish.

One example: In a 2006 New York Times column, Goolsbee marked the death of Milton Friedman, the patron saint of free-market fundamentalism, with a profile that saluted this right-wing hero for bringing "his brashness and his love of debate" to the University of Chicago. Not a word, in that column, about Chile, where Friedman acolytes -- the "Chicago boys" -- forced hyper free-marketism down the throats of a populace brutalized by the dictatorship of General Augusto Pinochet, a Friedman favorite who expressed his "love of debate" by having debaters tortured.

Last year, in another New York Times column, Goolsbee hailed subprime mortgages as a market innovation that can help people in need -- and dismissed fears that unscrupulous lenders would ever exploit this innovation "fool people into thinking they can afford homes that they cannot."

Five months later, the Times would document that very exploitation, in a report that exposed how the nation's top mortgage lender, Countrywide Financial, had been manipulating borrowers into "high-cost" loans that "made Countrywide executives among the highest paid in America."

So do we have, in Austan Goolsbee, an academic unwise in the ways of the world whose eagerness to achieve change "through market-oriented policies" will lead a President Obama down some dead-end primrose path?

Maybe not. Goolsbee may not be as excruciatingly centrist as his reputation suggests. In fact, on the central economic issue of our time -- the intense and unrelenting concentration of wealth at America's economic summit -- Goolsbee has often been downright good.

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Sam Pizzigati edits Too Much, the online weekly on excess and inequality.