the daily princetonian
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Wednesday september 18, 2013
Krueger discusses tenure as chairman of the Council of Economic Advisers GOVERNMENT Continued from page 1
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AK: I think the biggest success was that the recovery continued. When I started in the fall of 2011, there was a lot of concern about a doubledip recession, and I think the continuation of the 2 percent payroll tax cut provided support for aggregate demand. So we’ve now had 42 months of private sector job growth in a row since the recession ended and job growth turned positive. I think the most important thing we achieved was a continuation of the recovery. DP: How closely did you work with Ben Bernanke during your time in government? AK: The Fed is an independent agency, and we never publicly comment on Federal Reserve policy. There is a tradition which has gone on for decades, where the chairman and members of the CEA have a monthly meeting with the Board of Governors, so we had
lunch once a month down at the Fed. More generally, we benefited from interactions with the economists at the Fed. They have a large staff and a tremendous amount of expertise. So, if you want to understand an issue — how they’re modeling the effect of the sequester versus how we’re doing it, for example — it was very helpful to interact with them. DP: Is unemployment the best way to measure progress away from a recession? AK: I think the unemployment rate continues to be an important indicator. I think it’s one of many indicators. I think it still is indicating that the labor market is not yet back to full health, although we’ve made progress. I wrote an article for Bloomberg before I took my job … where I said the unemployment rate is going to continue to edge down, but we also have to be concerned with labor force participation. People may drop out of the labor force. So another indicator to
keep an eye on is the fraction of the population that’s employed — the employment-topopulation ratio. I think there are multiple measures of the health of the job market. DP: How do you respond to
I think that we heard a lot of crying wolf about inflation ... that never materialized. I think a bigger risk is deflation than inflation. alan krueger critics who argue that measures like the stimulus package and quantitative easing will be difficult to unwind, creating a drip-fed economy? AK: I think the Fed has the
tools to unwind and do it in a way which is at the right pace for the economy. I think that we heard a lot of crying wolf about inflation — that Federal Reserve policy would cause inflation — that never materialized. I think a bigger risk is deflation than inflation. DP: What advice did you give Jason Furman, your successor? AK: Jason had been around long enough that he didn’t really need that much advice. But there are a range of issues that the chairman needs to address, from managing the agency to knowing how to do IPA arrangements, where people go on leave from universities and nonprofits to work in the government, to substantive economic issues. Jason had been Principal Deputy Director of the National Economic Council, so he was extremely familiar with budget and tax issues. I thought it was useful nonetheless to go through some of the mechanics of the processes we go through on releasing
statements on the jobs report or GDP, some of the positions the CEA had taken on various policy issues in the past. I think it’s probably helpful, not a requirement but helpful, for the CEA to be consistent over time. I kind of explained where I stood on certain issues that he might not have known — most issues he probably already knew — or where Austan Goolsbee had been, and why I thought it useful to continue supporting various policy proposals. DP: Will your experience in government have an impact on your research and teaching here at Princeton? AK: I think there’s no doubt it will enrich my teaching. When I returned to Princeton after the Labor Department stint and after working at the Treasury, I think it helped my teaching by providing better examples of how things work in Washington. As far as my research goes, I think it will probably cause me to focus on some of the central challenges the economy currently faces,
like long-term unemployment, and will probably cause me to move away from some of the more peripheral issues I’d worked on, like the economics of terrorism. I think the two main challenges the economy faces are long-term unemployment and the large increase in inequality of opportunity that we’ve seen in the United States. I think those are the areas I’ll focus my research on. DP: What are you most looking forward to upon your return to campus? AK: I think I’m looking forward to being able to concentrate on a few issues at my own pace, as opposed to having to cover the waterfront. I’m sure that if I were still in Washington, my time would be totally absorbed by the budget negotiations and the debt ceiling — and I hope that gets worked out smoothly — but I think it’ll be nice to be able to focus on some of the long-term issues that affect the economy and not the short-term drama that Congress creates.
Post reporter defends role in NSA leaks SURVEILLANCE Continued from page 1
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because advanced software programs can discover from large amounts of data user patterns that would be hard to find manually. Gellman also defended Snowden’s decision to go public with the information by highlighting the inability of Congress to take action on its own. He spoke of how many high-level members of Congress had no idea of the NSA activities before the stories were published, and how those who did had no interest in publicizing its activities. He described the process as a cycle that begins with a government that tries to keep too many secrets and people who try to find them. He emphasized that while reporting these stories he has never published information without asking high-level authorities
to confirm that no information that could compromise national security would be released. The one exception he made was publishing, against the government’s demands, a list of major companies that had provided their data to the government. “If the harm that you’re worried about consists of companies stopping doing something because their customers and the public at large don’t like what they’re doing, and them losing business because of it, that’s why we have to [release the information]. That’s our job,” Gellman said. During the audience-led questionand-answer session, Gellman admitted that he constantly considers and reflects on the way that he handled the Snowden story and is aware of its consequences. He said he was “spooked” by the likelihood that he was subject of spe-
cial attention and surveillance. However, Gellman stated that he would stand by his right to resist any government pressures that may be put on him, given the importance of his information. “I’ve seen the accumulation of powers that Orwell could not have imagined, and not only that, but, in the hands of a relatively small number of people, this stunning capacity to track you,” he said. Gellman is currently an author-inresidence at the University’s Center for International Security Studies. He taught WWS 384: Secrecy, Accountability and the National Security State in the spring and fall semesters of 2012. The discussion was held in the packed Dodds Auditorium in Robertson Hall at 4:30 p.m. Tuesday and was moderated by former U.S. ambassador and Wilson School professor Daniel Kurtzer.
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