BARACK Obama is today set to nominate White House chief of staff Jacob Lew as his new Treasury secretary, ensuring a close ally holds one of the most important positions in the economic world.
If the appointment gains Senate approval, Lew will be placed at the heart of the brutal debate over the future of the US economy. He faces tough fights with Congress over demands to limit government spending and will have to deal with banking reform and concerns that the country’s global dominance is being challenged by China.
His first challenge will be to deal with the “debt ceiling”, which by law limits borrowing to $16.4tn (£10tn). This limit is due to be reached next month and Republicans are refusing to extend it without cuts to the federal budget.
Lew has a long pedigree in political economics, working under both Clinton and Obama as budget director at the Office of Management and Budget.
He has experience in bipartisan budget negotiations from his time as a top aide to Democrat speaker Thomas “Tip” O’Neill in the 1980s when the President was the Republican Ronald Reagan, and Democrats controlled the House of Representatives. His mettle was tested again in 2011 when he was chief negotiator during a previous debt limit crisis.
The 57-year old New Yorker and lifelong Democrat studied at Harvard and Georgetown and has experience of Wall Street, helping to run Citigroup’s alternative investments division between 2006 and 2009 before departing to join the Obama administration.
He has since been criticised for earning a $900,000 cash bonus in his final year with Citigroup, at the same time that the company was negotiating a bail-out from the US government.
An Orthodox Jew, Lew attempts to observe the Sabbath, by forgoing all work and technology between sundown on Friday and sundown on Saturday.
Meanwhile, a member of the Obama administration yesterday said the US wants Britain to stay in the European Union.
“We want to see a strong British voice in that EU,” said state department official Philip H Gordon. “That is in America’s interests.”