Now that Larry Summers is surrendering his position as the dark knight of American economics, someone new will direct the National Economic Council.
But how good remains to be seen.
The question is whether President Obama’s pick to replace an economist who did not "get it" with one who does.
But one reasonably savvy economist is being mentioned.
While the former Clinton administration economic aide may not be at the top of the Obama lists, she is, according to the Wall Street Journal, being mentioned.
And, significantly, Tyson is saying things that make sense.
In an interview this week on the PBS NewsHour program, Tyson argued for ending tax breaks for the rich and using the money for job creation.
Here’s some of what she said to Jeffrey Brown:
MR. BROWN: So you think we should let the tax cuts for the wealthy lapse. What’s the argument for doing that?.
MS. TYSON: Well, I actually think we have to step back and say, What are the problems? And then, once you know what the problems are, I think you can get to that solution. One problem is the jobs deficit. Another problem is the fiscal deficit. And I would say, also, one that’s not mentioned too often is the growth deficit.
So the decisions we make about tax affect all of those things. In the jobs-deficit case we’re talking about a lack of aggregate demand, insufficient aggregate demand. That means we certainly don’t want to allow all of the Bush tax cuts to expire right now. That would be not a good policy because those expirations will affect the purchasing capabilities of American household.
But, at the same time, we have this long-run deficit problem. And I think we need, right now, to not only be introducing policies to handle the jobs deficit but we have to have a credible plan on the table for a multiyear deficit reduction. And I believe part of that plan is most likely to be an expiration of the tax cuts for the top-two income-tax brackets.
It’s a lot of money. It’s over $3 trillion over a ten-year period. We have a big deficit problem. This is an important source of revenue to help handle that problem.
MR. BROWN: But we also, as you say, have a jobs and economic-growth problem. So you know the argument against what you’re suggesting. We heard it from Glenn Hubbard; we hear it from Republicans; we hear from it even a few Democrats, which is just, this is the wrong time to let any of these tax cuts lapse.
MS. TYSON: Okay. Well, I think—let me distinguish here ideal policy from compromised policy. My ideal policy would be to allow the top-two brackets to expire at the end of this year—to move off of the Bush tax cuts for the top two to 3 percent of the American population; to take the resulting additional tax revenue, which is probably in the order of $35- to-40 billion next year, and to take that money and spend it on job-creating programs.