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CEA rumors
From Megan McArdle. Austan Goolsbee may be going elsewhere. This could be either good or bad news; in any case the goal is to maximize his influence. The name Cecilia Elena Rouse is being floated for the CEA position.
Addendum: Alex posted earlier this year about Rouse's important paper finding that education vouchers increase the quality of public schools. Rouse was also an adviser for Kerry. MR archives know all!
Posted by Tyler Cowen on November 21, 2008 at 08:20 AM in Current Affairs | Permalink
Comments
Rouse at CEA would be cool.
Posted by: stefan at Nov 21, 2008 9:21:00 AM
I had Rouse for first semester statistics and I remember she gave the aura of hyper-competence and hyper-energetic, traits I've heard confirmed by people who have worked with her.
Is it common to have a labor economist for CEA?
How does this augur for education policy?
Posted by: Gabriel Rossman at Nov 21, 2008 9:49:00 AM
Why would you post a link to her bio at "The Committee on the Status of Minority Groups in the Economics Profession" instead of her biography at Princeton, which is the top google hit and, oh, where she works. I call bananas.
Posted by: katie at Nov 21, 2008 10:46:12 AM
in any case the goal is to maximize his influence
You mean: Obama's actual goal is that, or: Obama's goal should be that?
Posted by: mk at Nov 21, 2008 11:23:25 AM
Say it ain't so... Goolsbee was a primary reason I voted for Obama. He gave me hope that the Democratic party would look objectively towards the middle and acknowledge the virtues of free-market capitalism.
Posted by: Tim at Nov 21, 2008 11:28:20 AM
acknowledge the virtues of free-market capitalism
This isn't where the political divide is located, you know. Democrats have been acknowledging the virtues of free-market capitalism for decades, if not longer.
What the Democrats say is, sure, the free market is great and responsible for much of our wealth and prosperity, but it also needs to be checked and balanced somewhat by government. We need a safety net, we need regulations, we need government investment in infrastructure.
Actually, the Republicans basically believe that too, although in recent years they seem to have become more radicalized and I for one have lost faith in them.
Posted by: Barbar at Nov 21, 2008 11:59:56 AM
To follow up on my comment, I'm not saying that the Democrats are right or wrong about such things, I'm just saying that libertarians probably want more from Obama than mere acknowledgment of the virtues of capitalism. It's not hard to find examples of Obama mentioning the virtues of the free market.
For example, see here:
"In the more than two centuries since then, we have struggled to balance the same forces that confronted Hamilton and Jefferson -- self-interest and community, markets and democracy, the concentration of wealth and power, and the necessity of transparency and opportunity for each and every citizen. Throughout this saga, Americans have pursued their dreams within a free market that has been the engine of America's progress. It's a market that has created a prosperity that is the envy of the world, and opportunity for generations of Americans. A market that has provided great rewards to the innovators and risk takers who have made America a beacon for science, and technology, and discovery."
Posted by: Barbar at Nov 21, 2008 12:04:06 PM
Edward P. Lazear is Chairman of the Council of Economic Advisers. He is a labor economist.
Posted by: John B. Chilton at Nov 21, 2008 12:25:41 PM
Just heard on CNN that banks have gone suicidal. They are increasing fees and escrow, etc. Their response to default risk and falling assets values has been to charge higher rates and strain their customers cashflows. F'ing brilliant.
I'm thinking about closing my account and opening one at a credit union just to cash my checks and pay my bills from.
Posted by: aaron at Nov 21, 2008 1:10:46 PM
Say it ain't so... Goolsbee was a primary reason I voted for Obama. He gave me hope that
the Democratic party would look objectively towards the middle and acknowledge the virtues
of free-market capitalism.
Sucker!
What part of "share the wealth didn't you get"?
Posted by: Matt Shay at Nov 21, 2008 1:34:26 PM
Here's my favorite Goolsbee effort. It's from 2007 and it shows tremendous prescience, foresight, and prudence:
New York Times
March 29, 2007
Economic Scene
‘Irresponsible’ Mortgages Have Opened Doors to Many of the Excluded
By AUSTAN GOOLSBEE
“We are sitting on a time bomb,” the mortgage analyst said — a huge increase in unconventional home loans like balloon mortgages taken out by consumers who cannot qualify for regular mortgages. The high payments, he continued, “are just beginning to come due and a lot of people who were betting interest rates would come down by now risk losing their homes because they can’t pay the debt.”
He would have given great testimony at the current Senate hearings on subprime mortgage lending. The only problem is, he said it in 1981 — when soon after several of the alternative mortgage products like those with adjustable rates and balloons first became popular.
... Almost every new form of mortgage lending — from adjustable-rate mortgages to home equity lines of credit to no-money-down mortgages — has tended to expand the pool of people who qualify but has also been greeted by a large number of people saying that it harms consumers and will fool people into thinking they can afford homes that they cannot.
Congress is contemplating a serious tightening of regulations to make the new forms of lending more difficult. New research from some of the leading housing economists in the country, however, examines the long history of mortgage market innovations and suggests that regulators should be mindful of the potential downside in tightening too much.
...
And this study shows that measured this way, the mortgage market has become more perfect, not more irresponsible. People tend to make good decisions about their own economic prospects. ...
The traditional causes of foreclosure, even before there was subprime lending, were job loss, divorce and major medical expenses. And the national foreclosure data seem to suggest that these issues remain paramount. The latest numbers show that foreclosures have been concentrated not in places where real estate bubbles have supposedly been popping, but rather in places whose economies have stagnated — the hurricane-torn communities on the Gulf of Mexico and the industrial Midwest states like Ohio, Michigan and Indiana, where the domestic auto industry has suffered. These do not automatically point to subprime lending as the leading cause of foreclosure problems.
Also, the historical evidence suggests that cracking down on new mortgages may hit exactly the wrong people. As Professor Rosen explains, “The main thing that innovations in the mortgage market have done over the past 30 years is to let in the excluded: the young, the discriminated against, the people without a lot of money in the bank to use for a down payment.” It has allowed them access to mortgages whereas lenders would have once just turned them away.
The Center for Responsible Lending estimated that in 2005, a majority of home loans to African-Americans and 40 percent of home loans to Hispanics were subprime loans. The existence and spread of subprime lending helps explain the drastic growth of homeownership for these same groups. Since 1995, for example, the number of African-American households has risen by about 20 percent, but the number of African-American homeowners has risen almost twice that rate, by about 35 percent. For Hispanics, the number of households is up about 45 percent and the number of homeowning households is up by almost 70 percent.
http://www.nytimes.com/2007/03/29/business/29scene.html?pagewanted=print
Posted by: Steve Sailer at Nov 21, 2008 4:15:11 PM
i would very much like to believe that that education vouchers increase the quality of public schools. interesting.
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