"Trickle-Down" CLINTONOMICS!

[Mr. Shaman]

"As she prepares to step down as President Obama's chief economist, Christina Romer said Friday that she wishes she could redo one of her first official acts for the president: last January's forecast that a big shot of federal spending would save millions of jobs and keep the unemployment rate under 8 percent.

The forecast was wrong. Many economists agree that Obama's stimulus package probably saved millions of jobs, but the recession was far worse than Romer predicted. Unemployment has soared and is stuck at 9.5 percent.

Republicans campaigning to regain control of Congress have seized upon Romer's report as exhibit A in their case against the $862 billion stimulus package, arguing that the money was wasted and that Obama's economic policies have failed. The release of the latest jobs numbers Friday brought a hail of fresh GOP criticism of the measure "that was meant to keep unemployment below 8 percent," as Senate Minority Leader Mitch McConnell (R-Ky.) said in a statement.

Romer's comments came as administration officials launched a search for her successor as chair of the president's Council of Economic Advisers, an in-house think tank that has played a critical role in the administration's response to the worst recession since the 1930s. She is the second senior member of Obama's economic team to depart in recent weeks; White House budget director.

Peter Orszag left in July.

Obama has since named Jack Lew, a veteran of the Clinton White House, to replace Orszag. Two sources with knowledge of the process said Romer is likely to be replaced, at least temporarily, by Austan Goolsbee, a CEA member and University of Chicago economist who has advised Obama since his 2004 Senate race. The sources spoke on condition of anonymity because discussions on a successor are ongoing."

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"At OMB and in his public statements since leaving, Lew has been an advocate of fiscal discipline and repeatedly warned Congress not to use Social Security surpluses to cover current deficits in the discretionary budget. During his time at the Clinton OMB, he produced three years of budget surpluses.

In 2002, Lew said in congressional testimony, “It is important to remember that deliberate policy choices were necessary to produce a surplus and begin to pay down the public debt.” In the same testimony he warned, presciently, that President George W. Bush’s 2001 tax cuts would force unpopular cuts in spending or an increase in federal debt."