Goolsbee '91

Goolsbee ’91 puts economics degree to use for Obama
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By Aaron Bray
Staff Reporter
Published Friday, October 12, 2007
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During a 2004 campaign debate with Alan Keyes, his Republican opponent for an Illinois Senate seat, Democrat Barack Obama repeatedly cited the opinions of a “Professor Goolsbee.”

After spending a night hearing his advice referenced on television while sitting beside the candidate’s wife Michelle, Austan Goolsbee ’91, who had recently been appointed Obama’s economic adviser, finally decided to meet the candidate in person backstage.

He knocked on the dressing room door and found himself face to face with Obama.

“Who are you?” the candidate asked.

“Professor Goolsbee,” Goolsbee replied.

“What? You are Professor Goolsbee?” Obama exclaimed. “You don’t look anything like a professor, and you don’t look anything like a Goolsbee!”
Three years later, Goolsbee holds a position on Obama’s staff he never anticipated: chief economic policy adviser for a leading presidential candidate. In an interview with the News, Goolsbee painted a picture of himself as bound for academia ever since his days at Yale — where he graduated summa cum laude, finishing top in his major with a joint bachelor’s and master’s degree in economics.

But while his friends, classmates and former professors agree that his love of theoretical economics has always been apparent, they say Goolsbee was clearly destined for a more public role.

Illiam Carrillo ’91, who dated Goolsbee during their sophomore year at Yale, vividly recalls one conversation in particular in which Goolsbee expressed his political aspirations.

“I remember him saying, ‘I may not want to be the guy in the White House, but I would love to be an adviser to a president,’ ” she said.
Other classmates said Goolsbee’s current position as adviser to a presidential candidate is no surprise. They pointed to his academic excellence and sincere concern for the fate of those Americans left behind by economic growth — a trait some credited to his “humble beginnings” in Waco, Tex. — as signs that Goolsbee was headed for politics. Economics professor and Nobel laureate James Heckman, for whom Goolsbee did research as an undergraduate, said his former assistant always seemed destined for public policy even as an undergraduate.

Still, Goolsbee said even if he had considered working on the campaign trail, he never would have expected it to be for Obama.

Goolsbee said he remembers former classmate Greg Jacobs ’91 — an early fan of Obama’s — speaking glowingly of the future presidential candidate, then a law professor at the University of Chicago.

“Greg told me, ‘He’s going to the president,’ ” Goolsbee said.

After Obama lost his 2000 bid for a seat in the House of Representatives, Goolsbee recalled mocking Jacobs for supporting “this guy” who couldn’t even get elected to Congress.

But now Goolsbee — who said his boss thinks of him as “another skinny guy with an even funnier name” — is an Obama convert as well.
Goolsbee’s outlook on America’s economic future reflects Obama’s idealism and emphasis on bridging the two-party divide. Goolsbee said the policies he recommends address both the short- and long-term rejuvenation of the economy, in the hopes of providing a safety net while the country’s economy rebuilds.

“If this income structure remains in place for 20 years, it implies a very different America and a very different American dream,” he said.
For the first time in almost 100 years, Goolsbee said, productivity growth is not translating into wage increases for the majority of Americans.
“The top income levels have blown off the chart, but that’s not the issue,” he said. “The bottom 95 to 98 percent of income have been stagnant for the last six years. … That is extremely disturbing.”

The solution to this problem will ultimately be a new education plan that sends more Americans to college, he said. While the United States used to lead the world in the number of young adults with college degrees, Goolsbee said, it now ranks 33rd, between Bulgaria and Costa Rica. As a result, income levels will fall to the equivalent of the levels in those countries unless the United States reverses the current trend, he said.
“Education is the human growth hormone of the masses,” he said. “But education reform is still a process that will take decades.”
In the meantime, he said, gasoline, health care and college are all getting more expensive, and people are feeling the financial squeeze. He said the nation will need comprehensive health care and tax relief for the lower and middle classes to offset economic struggles until wages begin to rise again.
But while his policy prescriptions may sound stereotypically Democratic, Goolsbee’s conservative friends and colleagues said his centrist economic proposals set Obama’s campaign apart from those of other Democratic candidates.

Doug Webster ’91, a friend and fellow economics major from Trumbull College, said while his own politics are consistently conservative, he thinks even voters who usually lean Republican should take a second look at Obama because of Goolsbee’s advising.

“It’s putting conservatives in an interesting position,” Webster said. “Obama is changing the dynamic of the two-party system … he’s a Democrat with a strong fiscal policy. Other candidates would be hard-pressed to find anyone like Austan.”

Although some of his centrist economic prescriptions may disenchant liberals who distrust the benefits of globalization, Goolsbee said economic data indicate that free trade leads to higher wages.

“The issue of globalization is overblown as the cause of income inequality,” Goolsbee said. “The principal causes are increasing technology and demand for skilled labor.”

While Goolsbee said he is committed to applying his research to the real world, economics professors interviewed for this article said they disagree on how difficult it is to advise candidates without letting it interfere with academic work.

Barry Nalebuff, a Yale professor who taught economics while Goolsbee was an undergraduate but did not know him personally, said there is no conflict of interest.

“It’s good for the country to have great people contributing ideas,” he said. “Either Obama gets elected and uses his ideas, or Clinton gets elected and borrows them.”

But Heckman said Goolsbee’s role is “something of a compromise,” since the theoretical economic conclusions might prescribe a politically unpalatable solution. In that case, he said he expects Goolsbee will tell Obama the truth, and Obama will have to decide how best to proceed.
Goolsbee said Obama will not seek advice from him alone.
“He likes to bring in three or four people who disagree with each other,” he said. “Then he’ll have them debate while he quizzes them.”
Goolsbee has never been one to avoid controversy. In the spring of 1991, Goolsbee and his 14 fellow members of Skull and Bones tapped women for the first time. The campus buzzed with excitement, incredulity and exasperation as former Bonesmen locked the tomb and sought to reverse the decision.

Friends and classmates said they remembered Goolsbee vigorously defending the decision. They said he believed it was ultimately an issue of fairness; Carillo said Goolsbee considered those who were resisting the change to be “living in the Dark Ages.”

“He was militantly pro-tapping women,” said Andrew McLaughlin ’91, who was a member of the improvisational comedy group Just Add Water with Goolsbee. “He was generally willing to blow things up to make a stand for principle.”

Several other classmates interviewed said Goolsbee stood out for his combination of intensity and easygoing nature.

Robert Meinhardt ’91, also a Trumbull economics major, said he remembers sitting in the back row of an economics lecture in freshman or sophomore year while Goolsbee dominated discussion from the front.
“He was always the guy who sat in the front row and asked questions,” he said. “We would sit in the back and roll our eyes. We couldn’t understand the questions, let alone the answers.”

Still, Meinhardt said, Goolsbee was easy to get along with.
“He was never condescending,” Meinhardt said. “He was incredibly fun to hang out with.”

Goolsbee was known for his incessant economics jokes, his friends said, but most preferred watching his performances with Just Add Water.
Well, not everyone, Goolsbee admits.

Nobel Prize laureate James Tobin — for whom Goolsbee did economics research — had heard his assistant was a member of Just Add Water and asked Goolsbee repeatedly whether he and his wife could attend a performance. Goolsbee reluctantly agreed, and one night Tobin and his wife entered the dank interior of the Ezra Stiles Little Theater.

“The guys [in Just Add Water] got up and said there was a Nobel laureate in the audience,” Goolsbee recalled. “No one believed them. Then they were laughing at him for being a Nobel laureate, and everyone thought he was just someone’s grandfather.”

In class the next Monday, Tobin did not even mention it.

“He never spoke of it again,” Goolsbee said.

Goolsbee should have known, even then, that improvisation and economics do not mix.
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