Home' Technology Review : September October 2008 Contents FEATURE STORY
The Fourth of July is just days away, and on the Loop's
crowded streets and plazas, outside the downtown campus
of the University of Chicago Graduate School of Business,
the city swelters. Upstairs, in an air-conditioned o ce,
Austan Goolsbee is recounting how he was transformed from an
economics professor into the senior economic advisor to a can-
didate for the presidency of the United States.
Goolsbee must pick his words more carefully now, but it's no
great strain for him to tell a good story. The two men met in 2004,
after Barack Obama became the Democratic contender for junior
U.S. senator from Illinois and the Republicans fielded the peren-
nial candidate Alan Keyes. Though Keyes's Christian Dominionist
views on government and society have long made him unelectable,
the Democrats wanted to ensure that Obama could demolish
the opposition's economic platform. So his campaign contacted
Goolsbee, whom Obama knew by reputation, from his own years
teaching constitutional law at the University of Chicago, as an
expert on much that was cutting-edge in economics.
Keyes's economic plan was to abolish the income tax and
replace it with a national sales tax that exempted all housing, food,
and transportation purchases as well as the spending of the poor
and elderly. What would the sales tax have been for unexempted
goods, I ask, if the U.S. government's operating revenues were
to be maintained? About 70 percent, Goolsbee replies, laughing.
During 2004, the Obama campaign grew accustomed to calling on
Goolsbee's expertise. The candidate exchanged e-mails with the
professor. Still, they had no face-to-face contact. The two finally
met in October, during the second debate between Obama and
Keyes, at the ABC studio in Chicago.
"I hung in this room outside with Michelle, who was cool,"
Goolsbee recalls. Finally, informed that the candidate was ready
to receive him, he knocked on the door. "Obama opened the
door, looked at me in ba ement, and said, 'Who are you?' I said,
I'm Professor Goolsbee. Obama said, 'You can't be.' " He'd been
expecting an older tweed-jacketed academic, not---as Goolsbee
Photograph by CHRIS STRONG
claims Obama phrased it---another skinny, tall, youthful, geeky
guy with big ears and a funny name.
Goolsbee, now 39, graduated from Yale in 1991, earned his doc-
torate from MIT in 1995, and in slightly more than a decade has
built a remarkably broad résumé, which includes membership in
the Panel of Economic Advisors to the U.S. Congressional Budget
O ce, columns in the New York Times and Slate, a Fulbright schol-
arship, and even a stint hosting a television show, History's Business,
on the History Channel. As Tyler Cowen, an economics professor
at George Mason University and the author of the popular blog
Marginal Revolution, says: "Austan Goolsbee is smart."
Generations of the best and the brightest have come and gone
in Washington, DC, usually without e ecting significant changes.
In this, Goolsbee may or may not turn out to be exceptional. Never-
theless, he is something di erent in a presidential campaign: he is
part of a generation of economists who have focused on the Inter-
net, network e ects, behavioral economics, and neuroeconomics.
Whether Obama wins or loses, this is the first time a U.S. presi-
dential candidate has had a chief economic advisor whose outlook
and skills are those of a 21st-century economist.
Moreover, if Obama does win, 2008 will be a watershed election
in American political history for reasons unrelated to the new presi-
dent's skin color. For decades, the resident of the White House has
been closely associated with the South or Southwest. Now, some-
one from the intellectual milieu associated with the University of
Chicago is a plausible candidate. Along with Goolsbee and other
members of this intellectual movement---including Chicago Busi-
ness School professor Richard Thaler, a founder of behavioral
economics, and Cass Sunstein, a former professor at Chicago's
law school---Obama subscribes to a distinctive set of economic
theories developed at the university, and to a corresponding set of
policy prescriptions. These people are Chicagoans, who---to para-
phrase a native son---go at things in their own way, on the basis of
first to knock, first admitted. If Obama reaches the White House,
they will not be shy about implementing those prescriptions.
AUSTAN GOOLSBEE IS A NEW BREED
OF ECONOMIC ADVISOR FOR A NEW
KIND OF PRESIDENTIAL CANDIDATE.
By MARK WILLIAMS
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