Now that Larry Summers is departing as head of the Council of Economic Advisors, speculation has begun about who will be “the president’s chief economic advisor.” Ezra Klein tells us that the name being mentioned most is Anne Mulcahy, the former CEO of Xerox. Supposedly, appointing a business leader to the post will reassure the American capitalist class, who are under the impression that Barack Obama dislikes them, whereupon they will start hiring people again. Now, all three of those assertions are absurd – nothing Obama does will get the American capitalist class to stop hating him; Obama has actually been incredibly solicitous of business, as Jamelle points out; and they’d be hiring people if there were sufficient demand for their products to make it necessary. But that’s not what I want to address.
One of the consequences of the cult of the CEO, which probably started with Lee Iaccoca and continues to this day, is the widespread belief that a corporate leader who has done things like “create jobs” and “met a payroll” would naturally be good at any government job having to do with the economy. But that’s not something we should just accept without questioning.
I say this not to pick on Anne Mulcahy – I know nothing about her, and maybe she’d be the best CEA chief in history. But the fact that she ran a large corporation, in and of itself, doesn’t mean she knows a lot about the things government can do to shepherd the economy. She certainly knows how to manage a large organization with thousands of employees. But she wouldn’t be doing that if she was head of the CEA. She probably knows a lot about the copier business, or whatever it is Xerox does these days. But that wouldn’t really matter much. I assume she knows a good deal about setting a corporate vision, and making choices about product lines, and maintaining shareholder value. But those things aren’t all that relevant to this job either.
Corporate leaders don’t necessarily make good legislators, and they don’t necessarily make good presidential advisors. One particular CEO, because of his or her knowledge, experience, and insight, might in fact be just the advisor a president needs. But the idea that “what the president needs is a CEO” is almost certainly wrong.
— Paul Waldman