Orszag ’91 selected to direct Obama’s budget office
Orszag, who resigned as director of the Congressional Budget Office (CBO) on the same day, will be a key member of the president-elect’s economic team, advising the president on a variety of issues including federal spending programs and managing the federal budget. His job, Obama said at a press conference, will be to eliminate “those programs we don’t need and insisting that those we do need operate in a cost-effective way.”
Orszag noted that he loved and will miss the time he spent in his former position in his final entry in the director’s blog of the CBO.
“CBO is unique because it combines rigor, relevance, and range,” he wrote. “Rigor reflects the intellectual integrity of what CBO does. Relevance speaks to the importance of what it does. And range reflects the wide array of topics upon which CBO has something important to say — from national security to labor markets to natural resources, health care, immigration, and the list goes on and on and on.”
An economics major at the University, Orszag spent his free time working at local technical firms. He was the assistant to the president of Crittex, Inc., working on a patenting for a new technique for nuclear fuel reprocessing, and was also an editorial consultant for The American Prospect, a left-leaning political, cultural and policy magazine.
As a senior at Princeton, Orszag wrote a thesis titled “Congressional Oversight of the Federal Reserve: Empirical and Theoretical Perspectives” and won a Marshall Scholarship to study international economics at the London School of Economics (LSE), where he went on to earn his master’s and Ph.D. in economics.
Paul Starr, a professor in the sociology department since 1985, called Orszag “one of the best students I’ve ever taught at Princeton.”
“I have stayed in touch with him. I admire him a tremendous amount,” Starr added.
Former Federal Reserve vice chairman and economics professor Alan Blinder ’67 said he knew Orszag as a student and has “watched with pride his meteoric rise.”
“He was more or less a model student, really,” Blinder noted.
Blinder hired Orszag as a junior economist, analogous to a research assistant, for the Council of Economic Advisers under the Clinton administration while Orszag was a graduate student at the LSE.
“I brought him on staff and pretty soon everyone wanted [Orszag] to work for them because he was so good,” Blinder said.
“He did everything well, quickly, intelligently and with good judgment,” Blinder said. “A fraction of their work time was very self-directed, [which] ... requires people that have a lot of initiative and judgment, and Peter was certainly one of those.”
The Orszag family has three brothers: J. Michael ’89, Peter ’91 and Jonathan ’95. Their father, Steven GS ’66, was the F.E. Hamrick Professor of Engineering at Princeton until 1998, when he joined the Yale faculty.
Jonathan also worked at Clinton’s NEC from 1997 to 1999, is now a senior managing director at Compass Lexecon, an economic consulting firm in Washington, D.C. He said in an interview that Peter is a good fit for the job.
“Peter’s always excelled at what he’s done,” Jonathan said, adding that his brother “always succeeded under pressure, which is very helpful … for succeeding in the policy [and] political environment that he has been in as director for the Congressional Budget Office and he will be in as the director of the Office of Management and Budget.”
From Congress to the White House
Upon winning the Marshall Scholarship, Orszag told The Daily Princetonian in a Dec. 14, 1990 article that he wished to enter government service as a policymaker after earning his doctorate.
Orszag’s mother Reba, the president of Cambridge Hydrodynamics, a research and consulting firm in Princeton, said in an interview that Orszag has always shown an interest in public finance. “I think he just always had a concern for ... what taxes supported,” she said. Reba Orszag was also former president of the Center for Jewish Life board of directors.
Starr explained that Orszag’s appointment to the OMB will be crucial for health policy.
“He has a very strong interest in that area and he believes it is the central long-term budget issue,” Starr said. “He has, more than anybody else in recent years ... been sounding the alarm about the long term growth in healthcare costs.”
Blinder said he expected Orszag’s appointment.
“Having been the choice of the Democrats to head the CBO, he seemed like me — and to many others — the heir apparent to head the OMB,” Blinder explained. “I think he did a good job at the Congressional Budget Office, and he’ll do a similarly good job at the OMB.”
“We’re just extremely proud and excited and honored to have a son who’s the member of the cabinet in a very exciting administration,” Reba Orszag said. “I think that they’ll be a force, and, hopefully, they’ll be able to allow a very fine recovery — a robust recovery.”
“He’s extraordinarily young to be where he is now,” Blinder said. “To me he looked like a young man who was going places.”