screenshot/CNBC
BlackRock’s Michael Pyle on CNBC last March
During the holiday break, the Biden transition tried to bury some uncomfortable disclosures about their Cabinet nominees with a New Year’s Eve news dump. This didn’t work, as it was a slow news day, and now much of the political world is aware that Treasury secretary nominee Janet Yellen earned $7 million in speaking fees mostly from Wall Street financial firms, and secretary of state nominee Antony Blinken received $1.2 million from strategic consultant WestExec Advisors, counseling companies like Facebook, Microsoft, FedEx, AT&T, and Boeing.
In this environment, with the transition thrown slightly off course through the relationship between powerful appointees and corporate interests, you’d think it wouldn’t be a time to double down on those connections. But you would be wrong.
The Prospect has learned that Michael Pyle, currently the global chief investment strategist at leading asset management firm BlackRock, will become part of the Biden-Harris administration in the coming days. Pyle, an Obama administration veteran who also worked on economic policy in Hillary Clinton’s presidential campaign, will become the chief economist to Vice President–elect Kamala Harris, according to sources familiar with the transition.
Pyle would be the third former BlackRock official to join the administration. Brian Deese, who was global head of sustainable investing at the firm, has been named as Biden’s national economic director. And Wally Adeyemo, former chief of staff to BlackRock CEO Larry Fink, is the nominee for deputy Treasury secretary. Neither Deese nor Pyle would require confirmation by the Senate.
If anything, Pyle has a deeper relationship to BlackRock than his colleagues. He’s been there longer, since at least 2014. And his role as chief investment strategist is more central to BlackRock’s operations; he frequently comments on behalf of the firm in the media. BlackRock has drawn criticism for its contributions to climate change and its ability to use its influence inside governments to win favorable policies for its bottom line. It has been accused of self-enrichment while managing the Federal Reserve’s corporate-debt buying during the pandemic.
Pyle was seen as a likely candidate to re-enter the government four years ago. BlackRock recruited him from the Obama administration, where he served as a senior adviser to Undersecretary of the Treasury for International Affairs Lael Brainard. Pyle also worked at the National Economic Council and the Office of Management and Budget. He was an unpaid adviser to the Clinton campaign on financial policy, and seemed destined for a spot if Clinton won the election.
Vanity Fair reported that Pyle was looking for a job on the Biden team, perhaps something high-level at Treasury, and that the Biden transition team was determined to give him a big job. In that context, the post of chief economist to Harris could be seen as something of a fallback position. But that spot did carry some importance back when the last Democratic vice president was in the White House, a guy named Joe Biden.
His chief economist was Jared Bernstein, probably the most progressive and labor-focused member of Obama’s first-term economic advisers. Bernstein was at the table in many economic-policy discussions during that period; with Council of Economic Advisers (CEA) Chair Christina Romer, Bernstein put together the famed analysis justifying the 2009 economic-stimulus program as a job creation engine. (Bernstein will be a member of the CEA in the Biden White House.)
The evolution from Bernstein to Pyle is notable for a number of reasons. First, Bernstein has been working as an economist at think tanks for years, which would seem to be a prerequisite for a position with the title “chief economist.” Pyle has an economics degree from Dartmouth, but he went on to Yale Law, and afterward clerked for Merrick Garland on the D.C. Circuit Court of Appeals. Pyle has certainly spent his policymaking career focused on economics, for what it’s worth.
The bigger issue is that Bernstein was brought aboard with Vice President Biden as a counterweight to the centrist neoliberal economic team Obama had put together. With Pyle, the situation is reversed, and spending six years on Wall Street after leaving government has probably not pushed his policy outlook leftward.
Then there’s the added problem of BlackRock’s ongoing influence in the government. In White House policymaking, Pyle would be working closely with Deese, another expat of the same firm. BlackRock’s lobbying has already saved the firm from being designated as a systemically important financial institution, something that Biden’s regulators could reverse. But the continuing presence of company veterans in key policy positions makes that option remote.
Both Deese and Adeyemo plan to recuse themselves for an “appropriate period” from anything crossing their desk that’s related to BlackRock. As Pyle has not been formally announced, he has yet to make such a pledge. His deeper involvement with BlackRock would make his recusal far more crucial. The Biden transition did not return a request for comment.
Pyle’s selection to run economic policy for the vice president–elect also shows the influence of the Clinton policy team in Kamala Harris’s orbit. Her sister Maya was a senior policy adviser to Clinton, and her presidential campaign staff had several Clinton veterans on it. Harris’s vice-presidential chief of staff, Tina Flournoy, has been chief of staff to Bill Clinton since 2013. Placing a former Clinton adviser in the economic-policy slot was a natural choice for Harris.
How much of a player Pyle will be remains to be seen. As noted, the chief economist for the vice president was an important role in the Obama-Biden administration; that doesn’t automatically confer power to that slot in the Biden-Harris years. But the optics of yet another BlackRock executive getting admittance inside the Biden team sure don’t look great.
