The Senate Banking Committee unanimously approved the nomination of Freed Professor of Economics N. Gregory Mankiw as chair of President Bush’s Council of Economic Advisers this week, sending the nomination to the full Senate.
The vote came a week after committee members—armed with his distinctive blue and gold Principles of Economics textbook—tested Mankiw’s views on a wide array of fiscal and economic matters.
“It was a quick process, which is an indication of strong support,” Senate Banking Committee spokesperson Andrew Gray said.
During his hearing, Mankiw expressed general support for President Bush’s fiscal measures, deflecting senators’ attempts to demonstrate that his views clashed with Bush’s.
Partisans on both sides of the aisle have centered on portions of Mankiw’s textbook and other writings which seem to contradict the logic behind Bush’s policies.
Senator Jon S. Corzine, D-N.J., read from Mankiw’s textbook—which is the central text for Harvard’s Social Analysis 10, “Principles of Economics” and hundreds of other introductory courses around the country—a passage on the deleterious effects of maintaining a deficit, one of the more controversial parts of Bush’s economic plan. He then asked whether Mankiw still agreed with the view.
“Unless I changed my mind since that edition of the book came out two months ago,” Mankiw replied with a laugh.
But Mankiw emphasized his support for the mainstays of Bush’s program.
“Interest rate cuts by the Federal Reserve, and tax cuts enacted by Congress and signed by the president, have helped offset…contractionary forces and contributed to recovery,” he said at the beginning of his hearing, which lasted nearly two hours.
“I believe that passage of the president’s jobs and growth package would add to this effort,” he said of Bush’s tax plan. “It would help put people back to work in the short run, as well as encouraging capital accumulation and economic growth in the long run.”
Mankiw shied away from stating positions on individual policy questions.
“I really think it depends on the specifics and whether it passes the cost-benefit test,” Mankiw replied to one question about whether the construction of roads can be used to jump-start the economy.
Despite the lengthy questioning session, several of the committee members treated their approval of Mankiw’s nomination as a foregone conclusion.
As if the economist already had the job, senator Jack Reed, D-R.I., asked Mankiw to deliver a message to Bush on unemployment benefits, and Corzine said he appreciates “the service that we can expect.”
Although Gray said votes in the Senate Banking Committee, which is composed of 11 Republican senators and 10 Democrats, “can go either way,” he said the committee chairperson, Senator Richard C. Shelby, R-Ala., “was very supportive” of Mankiw.
The committee’s unanimous approval of Mankiw came this week by a voice-vote.
Bush named Mankiw as his nominee for the top spot in the three-person Council of Economic Advisors in February, after R. Glenn Hubbard announced that he would be leaving the post. Hubbard helped to craft Bush’s fiscal stimulus package.
Professor of Economics David I. Laibson said in February that the council fills three functions: it operates as a “sounding board” for economic policies proposed by the president; it initiates new ideas and economic policies; and it serves as a liaison between the president and Congress, the public and the United States’s allies.
Mankiw has kept a high profile while at Harvard and is well-regarded by students for his teaching ability and familiar to many beyond Cambridge because of his textbook.
Mankiw is one of several recent appointments made to replace key members of the president’s economic staff.
Former Treasury Secretary Paul H. O’Neill and former economic advisor Lawrence B. Lindsey both resigned in December, while former Securities and Exchange Commission chair Harvey L. Pitt stepped down in November.
—Staff writer Alexander J. Blenkinsopp can be reached at email@example.com.