What Is the Council of Economic Advisers?

The Council of Economic Advisers (CEA) advises the President on macroeconomic matters and is comprised of a chairman and two other members. The CEA’s aim is to advise and formulate economic policy for the White House and to insure that all government departments promote the economic agenda of the executive branch.

Key Takeaways

  • The Council of Economic Advisors (CEA) is an organization of leading economists who advise the president on matters of economic, monetary, and fiscal policy.
  • The CEA is intended to be a non-partisan group to advocate the best course of action for American economic policy regardless of party politics.
  • Historically, the CEA has favored Keynesian economics, advocating for running deficits to stimulate the economy during recessions and free trade.

Understanding the Council of Economic Advisers

The Council of Economic Advisers is comprised of three notable economists, a chairman, and two other members, each of whom is appointed by the President and approved by the Senate. Past chairman of the CEA includes Alan Greenspan and current Federal Reserve Chairman Ben Bernanke.

The current CEA chair is Kevin Hassett, appointed by President Donald Trump in 2017. The Council of Economic Advisers produces an annual report, "The Economic Report of the President", which summarizes its views on the past year, and offers a forecast for the coming year.

Hassett is the co-author of the book "Dow 36,000," published in 1999. At the time of his nomination to the CEA in 2017, Hassett was the State Farm James Q. Wilson Chair in American Politics and Culture and Director of Research for Domestic Policy at the American Enterprise Institute.

A fiscal conservative with a history of research on tax policy, Hassett also had previous high profile political advisory posts, having served as a policy adviser to the Treasury Department under Presidents George H.W. Bush and Bill Clinton and as an economic advisor to the Presidential campaigns of John McCain, George W. Bush, and Mitt Romney.

History of the CEA

The CEA was formed during the Truman administration with the Employment Act of 1946 and initially promoted a Keynesian bent, referencing the economic vision of John Maynard Keynes and central to New Deal economic policies in the United States.

While the chairman of the current CEA carries a more conservative approach to economic matters than previous Councils, President Trump removed the CEA chairman from a cabinet-level position. Nevertheless, the CEA is a key resource for economic issues between the White House and the executive branch and economic policymakers within Labor, Commerce, and other government agencies.