ECONOMIC REPORT OF THE PRESIDENT

progress, “confidence in the policy of ‘gradualism’ evaporated … [which]
helped to set the stage for the radical move to price and wage controls, which
the CEA had not foreseen and did not want” (1996).
More generally, Stein comments that two institutional deficiencies
of CEA are that “it does not look far enough ahead, but gets too engrossed
in immediate problems … [and that] like the government as a whole, is
deficient in contingency planning.” To remedy the first problem, Stein
advises that “[i]t might be useful to segregate a portion of the staff, under the
guidance of one of the members, to think only of what the economy and its
problems might look like in, say, 25 years” (1996).
Engage the Economics Community
The final function of CEA is to engage with the economics community,
by staying abreast of the latest academic research and by sharing new
insights with policymakers, and in turn, by communicating the administration’s
actions and plans to the economics community. This function helps
to support the administration’s efforts to develop economic policies and to
articulate and advance the President’s agenda. While the academic character
of CEA may not have been originally intended by Congress when it created
CEA, this engagement has arguably made the Council a more effective and
durable institution.
The Origins of Economists in the White House
Although CEA is now closely identified with the economics profession,
this was not originally the case. J. Bradford DeLong writes that
“[e]stablishing in the White House staff a group of short-term employees
with a primary allegiance to economists’ sense of the public interest may
have been the furthest thing from the minds of those who wrote Section
4 of the 1946 Employment Act” (1996). Rather, during the lead-up to the
passage of the Employment Act, “[t]here were some people in Congress
who envisioned the Council as a representative body … [and that] each one
of the three basic sectors of the American economy; agriculture, industry
and labor, should be represented on the Council” (Naveh 1981). Some supporters
of the Employment Act wanted CEA to be staffed by people who
had experience working in government or business, while others wanted to
appoint academic economists.
In the end, the first CEA under President Truman included representation
from all of these backgrounds. Nourse was an agricultural economist
who had spent much of his career at the Brookings Institution; Keyserling
was a lawyer who had completed graduate coursework in economics, and
324 | Chapter 7