White House chief of staff Jack Lew spent most of the bitter fiscal cliff debate out of the public eye.
That ends now.
President Barack Obama will nominate White House chief of staff Jack Lew for Treasury secretary as soon as Thursday, according to a person briefed on the matter. In doing so, Obama is throwing Lew straight into the middle of an increasingly nasty budget war, the likes of which Washington hasn't seen since the mid-1990s.
Lew should be prepared for this type of fiscal and political environment, though -- he helped President Bill Clinton strike the 1997 balanced budget accord as a top official at the Office of Management and Budget, the agency he has since run for both presidents. And Lew played an important role in the contentious 2011 debt ceiling debate.
Now, however, the liberal New Yorker will have an exponentially higher profile.
There is a certain symmetry to the pick. Four years ago, Obama's nomination of Geithner, then the president of the New York Federal Reserve Bank and an architect of the 2008 bailouts, signaled the urgency of reassuring markets still gripped by the largest financial meltdown since the Great Depression.
The president's decision to put Lew in the Treasury post four years later illustrates the crisis of the moment: the federal budget.
Lew's nomination comes a week after Washington barely averted a fiscal cliff free fall and just as lawmakers gird for a series of three new fiscal dramas -- a looming debt ceiling breach and the start of the spending sequester in two months, and a possible government shutdown in late March.
While Lew's resume is far different than many of the Wall Street titans and captains of industry who have succeeded Alexander Hamilton atop the Treasury Department, he is no stranger to Wall Street. From 2006 to 2009, the Harvard and Georgetown Law graduate worked as chief operating officer at the Citigroup Alternative Investments unit.
The majority of his career, however, has been spent as a behind-the-scenes Washington operator helping advance the agenda of his boss -- whether Tip O'Neill, Bill Clinton or Obama -- while keeping himself out of the spotlight.
The lifelong Democrat is known to lawmakers on Capitol Hill as a formidable ally -- and adversary. When Hillary Clinton became secretary of State in 2009 with an eye to increasing its budget after years of war in South Asia and the Middle East, one of her first moves was to pick Lew, her husband's former OMB director, as a deputy. In 2010, he took the reins at OMB again, before replacing Bill Daley as White House chief of staff in 2012.
"The thing that I learned early on was there's a space in Washington that is not deeply populated, which is a bridge between the highly technical and the political," Lew told POLITICO for a profile in 2011. "You didn't have to be the best politician, and you didn't have to be the best numbers cruncher or analyst. But if you could be fluent in both worlds and respected enough in both worlds, you could have an opportunity to be a translator and to make a difference."
While nobody questions Lew's heft, the partisan budget battles of the 112th Congress left few participants unscathed, including Lew. His combination of policy expertise and liberal partisanship rubs some top Republicans the wrong way.
"He has a hard time putting himself in the shoes of the people he's talking to, and for having a sense of how what he's saying is going to be received," said one Republican aide. "Therefore his suggestions are routinely way off the mark."
Lew was "always trying to protect the sacred cows of the left," said Barry Jackson, House Speaker John Boehner's former chief of staff, in Bob Woodward's 2012 book, "The Price of Politics."
But he's well versed in the ways of Capitol Hill and has survived multiple Senate confirmation processes intact -- there's little reason to believe his vetting by the Senate Finance Committee, and confirmation by the Senate, won't happen quickly. Whether it's quick enough to put Lew in place for the endgame debt ceiling talks remains to be seen.
Obama had Geithner, not Lew, take the reins in the fiscal cliff debate. The president kept Lew largely out of the congressional fiscal cliff talks so his future Treasury pick could avoid the partisan fray ahead of his likely confirmation process, POLITICO reported last week.
As Treasury secretary, Lew will be extending his reach far beyond the budget world to Wall Street, the housing recovery and the implementation of the 2010 Dodd-Frank regulatory overhaul.
Moreover, he'll be stepping onto an international stage where questions of Chinese currency manipulation, Europe's financial troubles and global economic trends will become part of his portfolio.
"You have to be a little bit above the fray as Treasury Secretary -- not just another advocate for the president. World markets are looking at what you say," said one longtime Senate Republican aide, noting that Lew became more of a partisan figure once he entered the Obama White House. "That will be a challenge for him -- what's been written in the Woodward book .... the perception is out there."
On the fiscal side, Lew "knows a lot more about spending programs than most Treasury secretaries know," the aide noted.
"I think that there's pretty broad agreement that the time for austerity is not today. We need to be on a path where over the next several years we bring our deficit under control," Lew said on NBC's "Meet the Press" in February of 2012. "Right now we have a recovery that's taking root and if we were to put in austerity measures right now, it would take the economy in the wrong way."
Ben White contributed to this report.
This article first appeared on POLITICO Pro at 10:54 a.m. on January 9, 2013.
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