Friday, September 25, 2020

REPORT: Establishment Elitist Is Biden's Top Choice For Treasury Secretary

 Lael Brainard

 At the top of Joe Biden's list (or Joe Biden's handlers list) for Treasury Secretary in a Biden administration is  Lael Brainard, reports Bloomberg.

This, I guess, is a plus in that it is not the capitalist hating Elizabeth Warren.

Stephen Stanley, chief economist at Amherst Pierpont Securities LLC, nailed it when he told Bloomberg that “If the Treasury pick were Brainard, the markets would take that as a signal that Biden intends to govern as a moderate, not give in to the progressive wing, so it sends a broader message. There would probably be some measure of relief that it’s not Elizabeth Warren but someone viewed as far less hostile.”

But this is pretty much the beginning and end of where a Brainard nomination to Treasury can be cheered by free market advocates.

She is an establishment elitist apparatchik.

Robert Kuttner approvingly reports on some of her establishment credentials:

Brainard’s doctorate in economics is from Harvard, where a member of her dissertation committee was Paul Krugman and a close mentor was Larry Summers.

After a job at McKinsey and a teaching stint at MIT, Brainard, still in her thirties, landed in 1997 as deputy director of the National Economic Council under Clinton, with a focus on international economics. She spent the Bush II years mostly at Brookings, where she directed the global economy program from 2006 to 2009. She was then named by Obama to be undersecretary of the Treasury for international affairs.

Kuttner signals she is part of an establishment opportunistic tag team: 

Brainard is also half of an Obama-Biden–era power couple. Her husband is Kurt Campbell, former assistant secretary of state for East Asian and Pacific Affairs under Obama, and a candidate for any of several top jobs in a Biden administration. Like Brainard, Campbell has also moved leftish. In two recent pieces in Foreign Affairs, he repudiated much of the Obama-Clinton wishful thinking on China, but without explicitly criticizing it. Once again, the intriguing question is what motivates this kind of repositioning—principle, tactics, or the changing needs of the times.

Currently,  Brainard is a member of the Federal Reserve's Board of Governor. She fits in nicely there with the current group of mad money printers. She is not objecting to the printing and in the past, before the COVIDF triggered printing, had called for more money printing.

One possible area where she would perhaps be a positive influence is on trade. She has a crony establishment perspective on trade. That is she is not in favor of free trade but in favor of negotiated trade deals which is about cronyism. But in my book, crony trade is better than no trade.

Of note, if Trump wins re-election, Steven Mnuchin, who has served as Treasury chief since the start of the Trump presidency, has publicly said he would serve a full second Trump term.


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