Hillary’s State Department Changes: Two Comments

As Mark observes, it’s a good thing that Hillary Clinton has appointed Jack Lew as budget director within the State Department. Two other things emerge from the NYT piece, one good, one bad:

1) Clinton seems to want to get State more involved in international economic affairs. This is good. Matt Yglesias is worried about this, suggesting that “letting the Treasury lead on this worked fine during the Clinton administration and insofar as it hasn’t worked under Bush it’s been because his Treasury Secretaries have been unimpressive and subcabinet jobs have often lingered vacant for long periods of time.”

I think that this is strongly open to doubt. Joseph Stiglitz’ takedown of Treasury’s blindness during the 1990’s on international economic affairs has been answered, but not very effectively. Brad DeLong, here, seems to think Rogoff gets the better of the argument, but in my view, he misrepresents the position of Stiglitz, who never argues that debt-laden countries should print more money: he simply argues that in countries without inflationary pressures should not be required to raise interest rates in order to avoid currency speculation: instead, the solution should not be insisting on international capital market liberalization–a position that the Fund has seemingly accepted now. Thomas Dawson of the IMF castigates Stiglitz for his attacks on the IMF, and then mentions offhand that the Fund has now changed its policies to look more like what Stiglitz wanted.

Bottom line: I’m not persuaded that leaving international economic affairs in the hands of the Treasury is necessarily the best policy. As a non-economist, I could be persuaded otherwise.

2) Note that although State appears to be ramping up on a variety of levels, climate change does not appear to be one of them. That brief will continue to be buried at Foggy Bottom, once again suggesting that perhaps USTR is the best place to put it. I don’t know much about Ron Kirk, Obama’s USTR selection: as a Texas Democrat, he doesn’t figure to be overly concerned with carbon emissions. But it would at least be more high-profile.

Author: Jonathan Zasloff

Jonathan Zasloff teaches Torts, Land Use, Environmental Law, Comparative Urban Planning Law, Legal History, and Public Policy Clinic - Land Use, the Environment and Local Government. He grew up and still lives in the San Fernando Valley, about which he remains immensely proud (to the mystification of his friends and colleagues). After graduating from Yale Law School, and while clerking for a federal appeals court judge in Boston, he decided to return to Los Angeles shortly after the January 1994 Northridge earthquake, reasoning that he would gladly risk tremors in order to avoid the average New England wind chill temperature of negative 55 degrees. Professor Zasloff has a keen interest in world politics; he holds a PhD in the history of American foreign policy from Harvard and an M.Phil. in International Relations from Cambridge University. Much of his recent work concerns the influence of lawyers and legalism in US external relations, and has published articles on these subjects in the New York University Law Review and the Yale Law Journal. More generally, his recent interests focus on the response of public institutions to social problems, and the role of ideology in framing policy responses. Professor Zasloff has long been active in state and local politics and policy. He recently co-authored an article discussing the relationship of Proposition 13 (California's landmark tax limitation initiative) and school finance reform, and served for several years as a senior policy advisor to the Speaker of California Assembly. His practice background reflects these interests: for two years, he represented welfare recipients attempting to obtain child care benefits and microbusinesses in low income areas. He then practiced for two more years at one of Los Angeles' leading public interest environmental and land use firms, challenging poorly planned development and working to expand the network of the city's urban park system. He currently serves as a member of the boards of the Santa Monica Mountains Conservancy (a state agency charged with purchasing and protecting open space), the Los Angeles Center for Law and Justice (the leading legal service firm for low-income clients in east Los Angeles), and Friends of Israel's Environment. Professor Zasloff's other major activity consists in explaining the Triangle Offense to his very patient wife, Kathy.