The National Economic Council (NEC) was founded by the last Democratic President. He promised to “focus like a laser” on the economy. The NEC was supposed to be an economic equivalent to the National Security Council. It was viewed with some skepticism within the bureaucracy. National security almost always includes two heavyweight departments (State and Defense) and often other agencies as well. Treasury does not have a peer competitor on economic policy. Smaller players on economic policy were also not keen on this new structure. To mollify the Council of Economic Advisers, it was agreed that the NEC wouldn’t have any actual economists – it would manage process rather than forge policy.
The NEC however had an important asset. Its first chief, Robert Rubin, was an able player with access to the President and an excellent relationship with Lloyd Bentsen the Treasury Secretary. But it wasn’t clear if this new structure was here to stay, or merely an effective vehicle for Rubin.
When Bentsen stepped down, Rubin replaced him (just as National Security Advisers have often replaced Secretaries of State.) When Rubin stepped down as Secretary of Treasury he was replaced by his deputy at Treasury Lawrence Summers.
Now, in the Obama administration, Summers is the head of the NEC. Offhand I cannot think of a Secretary of State coming back to be the National Security Adviser. Kissinger held both positions at once – but started as the NSA.
So does this mean that the NEC has now become an important component of the White House bureaucracy? The NEC wasn’t exactly front an center in the Bush Administration. More than likely this is a return to the NEC’s roots as a vehicle for an out-sized personality that the President wants to keep close at hand.