The White House has announced that Dr. Christina Romer, Chair of the President’s Council of Economic Advisers, will soon resign and return to California. This comes on the heels of Budget Director Peter Orszag’s resignation. Dr. Romer is generally considered to have the inside track to replace Janet Yellen as President of the San Francisco Federal Reserve Bank when Dr. Yellen moves to become Vice Chair of the Federal Reserve Board of Governors.
There is a lot of press speculation about why Dr. Romer is leaving and about why Budget Director Peter Orszag left. This speculation centers on the personalities and interactions among various members of the President’s economic team.
I think I can instead add a little value by describing the different positions that make up the President’s economic team, and in particular by explaining the roles of the heads of the National Economic Council and the Council of Economic Advisers. The NEC is run by Dr. Larry Summers, while Dr. Romer is the outgoing CEA Chair.