President Obama made it official on Thursday. He nominated chief of staff Jack Lew as Treasury Secretary to replace Tim Geithner, who is expected to leave the administration on Jan. 25.
If confirmed by the Senate, Lew will start the job with years of experience working in Washington as well as stints in academia and Wall Street.
He is a former budget director for the Obama White House as well as the Clinton Administration and a former deputy Secretary of State under Hillary Clinton.
Lew was a key player in the 2011 bitter negotiations between the White House and House Republicans to raise the debt limit. The debt limit was eventually increased but not until after the U.S. lost its triple-A credit rating from ratings agency Standard & Poor's. As Treasury Secretary Lew could play an even greater role in this year’s upcoming budget negotiations.
Jack Lew's Early Years
Lew has a reputation as a New York liberal who started early in politics. As a 12-year-old, he campaigned for the anti-war Congressman Eugene McCarthy during the 1968 presidential primary season. Years later he was a senior policy adviser for House Speaker Tip O’Neill, Jr.
“I grew up in many ways on the Hill in Mr. O’Neill’s office," Lew told The New York Times.
Another big political influence on Lew: Paul Wellstone, who was Lew’s advisor at Carleton College before he became a liberal Democratic senator from Minnesota. Wellstone got Lew an internship working for Rep. Bella Abzug (D-N.Y.).
During the last decade he worked outside of Washington, first as an executive vice president at New York University, then managing director and chief operating officer at Citigroup Global Wealth Management.
The Upcoming Budget Battles
Greg Valliere, who follows Washington for Potomac Research, says Lew is a budget wonk who doesn’t have much experience in business or foreign issues. “There are some holes in his game,” Valliere tells The Daily Ticker.
But one area where Lew excels, says Valliere, is the budget. “He probably knows more about budget issues than anyone in Congress including Paul Ryan,” Valliere says. “He has an encyclopedic knowledge but he doesn’t give ground very easily…this is someone who’s going to take a very hard line as we head into debt ceiling talks in late February.”
And that hard line could be problematic when it comes to crafting a budget compromise. In a recent note Valliere writes that Lew has “legions of detractors within the Republican Party because of his refusal to compromise in past negotiations.”
Valliere, like most observers in Washington, expects Lew will be confirmed by the Senate but he expects there will be lots of questions about why the president’s inner circle doesn’t include anybody with "real business experience.”