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After stacking his office full of the same people who helped derail the economy, it seems that President Obama has finally started to understand that monetarism isn't working. Obama has nominated Alan Krueger, a labor economist at Princeton, to chair the prestigious White House Council of Economic Advisers. Krueger is a pretty serious guy, and most importantly, a Keynesian economist (ie. he understands the role government should play in a depressed economy). The Huff Post provides a brief synopsis of his career:
While at the Treasury, Krueger worked under Obama during a number of previous job-creation initiatives, including a hiring tax credit for small businesses in early 2010. He also helped to create a program known as Build America Bonds, which ran from 2009 to 2010 and made it easier for states and cities to borrow and invest money. The program, which Krueger has written about for The Huffington Post, was regarded as one of the more successful stimulus efforts of the Obama administration....
In one influential 1995 study, Krueger and the labor economist David Card refuted a commonly held belief that increases in the minimum wage lead to fewer jobs for low-paid workers. Their research showed instead that in multiple real-life scenarios, raising the minimum wage resulted in no significant job loss.
After the horrific debt ceiling compromises, the Obama adminstration is going to have to get pretty creative when it comes to finding ways of stimulating the economy. The Democrats essentially caved in to the massive austerity measures the Republicans insisted on that will depress the economy for years to come. Krueger seems to be a bright and creative guy, and hopefully he might find ways to shift tax dollars around to do something positive.