Who Should be the Next Treasury Secretary?

Four days ago, Ezra Klein reported that Erskine Bowles is the front-runner for Treasury Secretary in a second Obama Administration. It’s hard to think of any plausible Democrat who would be a greater disaster. Bowles has a man-crush on Paul Ryan; his chairman’s mark for his eponymous commission was simply an embarrassment on both political and policy grounds; a managing director of Morgan Stanley, he is Wall Street’s creature. He has no business running Treasury any more than I do. Take a look:

But if that is the case, then assuming (in best chickens-counting style) that there even is a second Obama Administration, who should the next Treasury Secretary be?

This isn’t merely idle blog talk (although I am under no illusions about RBC’s awesome policy influence). One great failing of progressives is that after the 2008 election, we simply celebrated. Wall Street did not: it got to work making sure that its people were in key positions, and that Barack Obama’s agenda would never challenge the financial industry’s power. That’s how we got Timothy Geithner at Treasury, Larry Summers at NEC, Ben Bernanke reappointed at the Fed, Bowles himself appointed to an absurd “deficit reduction commission”, Christy Romer sidelined at CEA, and ditto Elizabeth Warren.

So if, as anyone not committed to entrenched plutocracy should hope, President Obama wins a second term, the very next day should be devoted to making sure that President Obama does not make such disastrous picks again. That means being prepared to push very hard against rancid appointments like Bowles and in favor of someone else. I would hope that the day after Obama’s re-election, Al Franken and re-elected Senator Sherrod Brown call the White House and make it very clear that if they have anything to say about, Bowles will never be confirmed.

But who should be? A couple of notes: 1) at this stage, we should not worry about confirmability too much. The Republicans will seek to block anyone (whether by filibuster or otherwise), and at some point progressives will have to press President Obama to make a recess appointment; and 2) for what it’s worth (and it may not be worth much), there has never been a woman or a minority heading Treasury.

There are a few I can think of offhand: former FDIC chair Sheila Bair, former CFTC chair Brooksley Born, Paul Volcker (too old?), Gary Gensler, Christy Romer, Jared Bernstein. Hillary? I would be very wary: the Clintons created the Wall Street Democratic party, all of her advisors will be Rubinites, and if she wants to run for President in 2016, negotiating with Wall Street potential campaign contributors provides dark incentives. Still, she could be more progressive as a way of attracting primary support.

Paul Campos wants The Shrill One: that would be great, but I think that’s a little too far-fetched even at this stage. Nevertheless, Campos is asking the right question.

By the day after Election Day, progressives should have an answer. Because Wall Street sure will.

[Cross-posted at The Reality-based Community]

Jonathan Zasloff

Jonathan Zasloff is a professor of law at the University of California, Los Angeles.