Krueger rumored to be pick for assistant treasury secretary

According to the Journal, Krueger, who served as a chief economist at the Labor Department from 1994 to 1995, was one of several individuals Treasury Secretary Timothy Geithner has said he would like to have serve in top posts at the department. The Journal also reported that an official announcement could come soon. While many of the individuals named are currently working as advisers to Geithner several have yet to come on board.

The news follows a Friday report in The Detroit News that Krueger was reached by phone Thursday at the Treasury Department and confirmed he is consulting for the government.

Wilson School professor Uwe Reinhardt praised the rumored selection in an e-mail sent over the weekend to The Daily Princetonian.

“I can flatly assert that Alan is one of the brightest human beings I have ever met, someone who can combine the most sophisticated econometric techniques with solid common sense about the economy and has a wide ranging intellect,” Reinhardt said in the e-mail. “He is not an economist who is a prisoner of a particular model, as quite a few of his fellow economists are.”

Reinhardt said he "naturally had assumed that Alan Krueger would go to the Labor Department, because that has been the center of gravity of his research. I had not thought of him as a macroeconomist, and even less so as someone in finance.”

Reinhardt added that Americans “would be lucky to have someone like [Krueger] serve the nation in a highly elevated capacity. Besides, he is a Mensch.”

The founding director of the University’s Survey Research Center, Krueger is a Cornell graduate and earned a Ph.D. in economics from Harvard before joining the Princeton faculty in 1987.

Krueger did not respond to requests for comment.

A civil service problem

Reports of Krueger’s appointment come at a time when many top posts at the Treasury Department are still unfilled because of the Obama administration’s strict regulations and vetting process for potential employees, the Journal said.

“Time and again we learn the downside of our model of governance,” Reinhardt explained. “Parliamentary systems tend to have permanent secretaries and permanent staff, who then dutifully [execute] the policies of the sitting government, as represented by the politically appointed secretary, the permanent secretary’s boss.”

“We tend to sweep out several layers of staff (3 to 4) in the agencies when administrations change hands, and then replace them with new, political appointments who spend 2 years learning their new task,” Reinhardt added. “It is said to have the advantage of bringing in loyal troops and to add new perspectives to the tasks at hand. The downside is that half of the first year of any new administration is wasted staffing up and the next year learning the tricks of the trade. It is why policy moves so very slowly in this country.”