If you had known Austan Goolsbee way back when, you might not have expected him to ever chair President Obama’s Council of Economic Advisers. Even now, at 41, he still looks more like one of his M.B.A. students than like a professor.
That effect was even more pronounced at 35, when he first met Barack Obama, who was then a state legislator running against Alan Keyes for a U.S. Senate seat from Illinois. A mutual friend had suggested that Goolsbee write some issue memos for Obama, but the two had never met. When Goolsbee had a lengthy lunch with me recently at Founding Farmers, an eco-conscious restaurant in the headquarters of the International Monetary Fund, he recalled their first meeting, at a 2004 debate with Keyes. “You look nothing like a professor,” said Obama, startled. “Where’s the beard and the tweed jacket? And what’s with Goolsbee?”
Goolsbee chuckled. “‘Hey, you’re not the only skinny guy with a funny name—as far as I’m concerned, you stole my bit.’”
By all accounts, this sort of thing has endeared him to the president. Nonetheless, when he joined the Obama campaign, I had a shocked and faintly amused conversation with another economics journalist who knew the professor fairly well. “Can you imagine Austan in the White House? Austan?”
It’s not that we thought he’d give bad advice: rather the opposite, in fact. I’d known Goolsbee since 2001, first as my professor at the University of Chicago, and then as an economist whom I interviewed. He was a sound economist, refreshingly independent, and intellectually honest. But those qualities seemed more like liabilities than assets in Washington.
Our suspicions seemed to be confirmed in February 2008, when a Canadian television network reported that an Obama adviser, whom ABC later identified as Goolsbee, had told Canadian diplomats that Obama was stepping up the rhetoric on NAFTA, and said, “It’s just campaign rhetoric … It’s not serious.” Everyone had already suspected as much, of course, but Goolsbee seemed to have made the un-Washingtonian mistake of saying out loud what everyone else was uncomfortably thinking.
Goolsbee’s decision to step down in August after 11 months as head of the council (after joining it in March 2009) and return to his professorship in Chicago was greeted by sniping and sniffs. One Fox online headline crowed, “Obama’s Top Economic Adviser Jumps the Sinking Ship.” The Huffington Post argued that Goolsbee “has often taken positions that have failed to carry the day, or he has ratcheted down his prescriptions from the outset.” Even The Economist, generally a fan, admitted: “Goolsbee’s tenure as chairman has been a thankless one.”
Thankless, perhaps—but Goolsbee’s stature as Obama’s longest-serving economics adviser is in fact a fairly remarkable testament to him, and to his president. Christina Romer, the first person to chair Obama’s Council of Economic Advisers, had done major work on economic stimulus and other questions that became very important at the height of the crisis. Goolsbee’s contributions are less obvious—but that doesn’t mean they have been less important. Pundits on the outside may ask what specific initiatives he pushed, but that is not how Goolsbee describes his position. “I always felt my role was like the pit crew in a Nascar race and President Obama was Dale Jr.—he’s driving, and my job is to change the tires and get him back on the road.”
People who have worked with Goolsbee do not talk about the fierce policy battles that he waged; they praise his flair for asking questions that get at the heart of the matter, his self-deprecating humor, his talent for “disagreeing without being disagreeable,” and his commitment to making sure that the president understood all possible angles before he made a decision. “He’s got no agenda,” says Valerie Jarrett, a senior adviser to Obama. “He’s respectful, but he tells the president exactly what he thinks, and he’s not shy about telling the other members of the economic team what he thinks.” Of course, advisers are always nice about other advisers—on the record. Then again, no one has ever tried to convince me, on the record or off, that Larry Summers didn’t have an agenda.
Washington worships the policy warriors, the brilliant macroeconomic manipulators who push through their agenda, using canny negotiation or the sheer force of fiery will. But Washington also very much needs its policy mechanics, the people who make sure that no matter what decision the president makes, the wheels won’t come off.
“What you like about Austan,” says Jeff Immelt, the CEO of General Electric, “is that he’s curious; he asks good questions; he listens. He also recognizes the limitations of what policy can do.” Immelt worked with Goolsbee on the President’s Economic Recovery Advisory Board. “He’s … a brilliant guy who’s also disarming. He’s supersmart but he doesn’t make you think he’s supersmart—he’s stealthy.” David Axelrod, another of Obama’s close advisers, also calls Goolsbee “brilliant,” but puts it more vividly: “He always sounds to me like the voice-over guy on a beer commercial.”
Bluntness, self-deprecation, and a knack for asking difficult questions: these are not necessarily the weapons you need to win policy battles. But in an adviser, they can be strategic assets that help a president win the policy war. The last administration had lots of policy warriors; it also had lots and lots of terrible mistakes made by people who didn’t ask enough questions. President Obama certainly knew Goolsbee well enough to understand what he was doing in elevating him to the council chair at the tender age of 41, making him the second-youngest person ever to hold the job. (The youngest was Arthur Okun, who served during the last year of the Johnson administration, and was just 39 when he took the job.)
But perhaps I am prejudiced, because I have experienced Goolsbee’s stealthy brilliance firsthand. In the winter of 2001, Goolsbee opened my technology-strategy class by asking, “Okay, now who likes the AOL–Time Warner merger?” We all raised our hands. The $165 billion megamerger had just closed, and the top-tier banks and consultancies we’d been interviewing with had gotten a piece of the deal. We’d become expert at generating novel reasons to love that messy agglomeration of old media and new.
Goolsbee was nodding, which made us feel smart. “Okay, why?”
Even the normally shy students bubbled over with justifications, and for some minutes Goolsbee listened intently and wrote our answers on the whiteboard. By the time he was done, the list spanned several columns, and AOL–Time Warner was beginning to sound like the best idea since the joint-stock company. And then he systematically demolished every one of those reasons.
The carnage went on for an hour, until his barrage of calm and deadly questions had deflated dozens of M.B.A. egos sufficiently to make room for learning. And then, gently, he started showing us when mergers do work—deals that require specialized investments, various sources of synergy, industries with large economies of scale. But the list of successful-merger conditions was short, and nothing on it sounded remotely like AOL.