-Peter Orszag: OMB Director-nominee-designate-leekee. The Director of the Office of Management and Budget is the guardian of budgetary rationality: Do the government’s tax and spending plans add up? Do they make sense? Are the right departments being given the money then need—and are they spending it the right way? Are the entitlement programs the right size and targeted the right way? The Bush II administration was marked by a series of extraordinarily weak OMB Directors who essentially did not try to do their jobs—and the country is much the worse for it. The Bush I and Reagan administrations were marked by very strong but devious OMB Directors who did not work and play well with others—and so in the end failed to do their jobs. Peter Orszag is either the best or one of a very small group of people who are the ones best qualified for this job.
-Federal Reserve Chair-nominee-designate-leekee. Ben Bernanke’s term as Fed chair is up in two years. Ben might not want to continue—it’s been a rough ride. And Ben will probably be damaged goods: too many people who think that he gave away too much public money to feckless financiers and too many other people who think that he has not done enough to protect and stabilize the financial system. I think Ben has done a good job—certainly a much better job than I would have done in his shoes. But I think the odds are that a fresh start would be good, and for policy continuity it would be a good idea to designate Ben Bernanke’s probable successor now.
-Treasury Secretary-nominee-designate-leekee. There are two ways to go with Secretary of the Treasury: First, to choose somebody with as much gravitas as possible—a Warren Buffett or a Paul Volcker—and give them as a deputy somebody extremely capable but perhaps not yet of sufficient financial stature to be the ideal choice for the top job. (My favorite candidate for Deputy Secretary if the Obama-Biden administration goes down this road is Laura Tyson.) Second, to sacrifice some gravitas and to instead choose the smartest and most energetic person with sufficient knowledge of finance. (This is my preferred option: and my preferred candidate is Larry Summers.) As far as the Treasury is concerned, the bench is thinner than I had first thought: you need somebody who (a) knows finance, and (b) hasn’t been making a fortune over the past five years by benefiting from the creation of the mess that the government must now clean up.
Profiles of Geithner
Ministry of all the talents