Clinton is pressured on advisers Picks new member to economic council

January 04, 1993|By New York Times News Service

Responding to pressure to name a prominent mainstream economist to the Council of Economic Advisers, President-elect Bill Clinton has offered a seat on the council to Alan Blinder of Princeton University, and Blinder has accepted, aides to Clinton and others familiar with the appointment said over the weekend.

Blinder, whose appointment is likely to be announced this week, would serve under Laura D'Andrea Tyson, a Stanford University economist. Some economists have criticized Ms. Tyson's appointment, arguing that her speciality, industrial and trade issues, has not given her the broad skills needed by a chairman of the council.

Blinder's appointment would help to counter this criticism; he is highly regarded as a macroeconomist, a specialty that carries considerable status in his profession.

Macroeconomists employ mathematical formulas and computer models, among other techniques, in attempts to determine how the economy might respond to particular government policies or other economic developments.

Among the policies likely to be proposed by a Clinton administration and evaluated by the council are increased spending on public works, an income tax cut for the middle class or a higher gasoline tax. Macroeconomists also try to forecast turns in the economy -- the likelihood of recoveries or recessions.

The chairman of the Council of Economic Advisers has generally overshadowed the two other members, working directly with the president while the others have stayed in the background, their names almost unknown to the public.

But as a macroeconomist, Blinder is likely to play a prominent role, since he is considered more suited than Ms. Tyson to performing a key task of the council: assessing the impact of proposed policies.

"I will be vastly reassured if Alan Blinder is named to the Council of Economic Advisers," said Paul R. Krugman, a Harvard University macroeconomist who had himself been a candidate for the chairmanship. "He would provide the necessary analytical skills that Laura Tyson lacks."

Ms. Tyson came to Clinton's attention during the campaign and has helped to draft amendments to President Bush's free trade agreement with Mexico and Canada that Clinton might insist on after his inauguration. These would, in effect, require Mexico to enforce its labor and anti-pollution laws.

Blinder also helped with the campaign, and he spoke on macroeconomic issues at Clinton's recent economic get-together in Little Rock, Ark. Reached by telephone yesterday, the economist declined comment on the reports of his appointment.

During the campaign, he came out in favor of increasing the deficit to finance public works spending, a position favored by many economists who supported Clinton.

Blinder, 47, has been an economics professor at Princeton, his alma mater, since 1969. He received his Ph.D. at Massachusetts Institute of Technology and is the author or co-author of three books on economics. If Congress approves his appointment, this will be his first government job.

No one has yet been publicly identified as a likely candidate for the third seat on the Council of Economic Advisers.

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