As former governor of the Federal Reserve Board and a high-profile authority on national economic issues, Yellen joins Laura D'Andrea Tyson, former director of the Berkeley Round Table on the International Economy and outgoing chief economic advisor to the President of the United States, as the second Berkeley economist who has held a top-level policy position. (Yellen was appointed to replace Tyson as chief economic adviser in December).
Yellen's appointment to the federal board in August 1994 made her the ninth Berkeley economist to land a job in Washington during President Clinton's tenure. Since then, nearly a quarter of the university's economics faculty from the business school and the College of Letters & Science has taken leave to go to Washington. No other university outside the Ivy League has provided the White House with so much economic brain power as Berkeley has.
Other Berkeley faculty members who have been tapped by the Clinton administration include Jeffrey Frankel, an economics professor nominated in September by President Clinton to the Council of Economic Advisors, and Richard Gilbert, an economics professor who provided economic analysis for the Justice Department and played a key role in the Microsoft Corp. antitrust case. He was replaced by Carl Shapiro, professor of business and economics. Michael Katz, also a business and economics professor, served as chief economist at the Federal Communications Commission, and was replaced by economics professor Joe Farrell. And Brad De Long, associate economics professor, was deputy assistant secretary for policy at the U.S. Treasury Department.
If there is a Berkeley "mafia" in Washington, then Tyson is The Godmother. Tyson, who recently announced her departure and returned to Berkeley in January, helped bring David Levine, an associate business professor, and Jay Stowsky, a Berkeley research associate, to serve as senior economists on the Council of Economic Advisors. William Dickens, an associate economics professor, served as staff economist.
For Yellen, most important of all was the fact that Tyson was close enough of a colleague to know the name of her travel agent. Around the time she was nominated for the federal position, Yellen had decided to go on a brief spring vacation to a secluded island in Hawaii with her husband, George Akerlof, an economics professor who divides his time between the Brookings Institution in Washington and a class he teaches at Berkeley.
"Meanwhile, my office answering machine was filling up with messages from Washington," Yellen recalled with delight. "I saved the tape. It was the most incredible string of messages, starting with so-and-so from the Council of Economic Advisers to White House Operator Number One. Laura happened to remember that my travel agent was at Northside Travel, and she was able to track me down. They were ready to find someone else."
Yellen had learned her first lesson in Washington protocol.
"One of the major differences between life in Washington and life in Berkeley is that you can't go anywhere here without leaving a number where you can be reached. It's unthinkable in government that someone couldn't be reached."
The early afternoon sun sliced through an opening in the thick blue taffeta curtains of Yellen's Colonial-appointed office and lit up her slightly disheveled silver hair. She was wearing the same outfit she bought the day she was nominated: a navy blue jacket with a matching pleated skirt and a multicolor scarf draped around her shoulders.
"I didn't even own a suit. I never felt I had to have a suit at Berkeley. I was to be nominated in front of the Presidential Seal. The minute after I got the call, I walked across the street and bought a blue suit. I haven't stopped buying blue suits, or their equivalent, since then. I consider this my uniform," she said, then added with a sparkle in her eye. "Someday, I'm hoping to go back to my slacks and burn everything I own that's navy blue."
"The big difference between working at Berkeley and working in Washington is that in Washington, people care about you if you have the 'right' ideas, no matter where you get them from," said Akerlof, a pleasant, soft-spoken man with an independent, outsider's view of the D.C. scene. "In academia, you get credit for being the innovator."
Akerlof said getting noticed was also a matter of logistics. "A large part of everything is the agenda. If you get on the agenda, you get listened to."
If getting listened to is a goal, then Yellen has superseded it. She was still reeling from the fallout over comments she made before a group of Kansas City bankers and business professionals a few weeks before, where the press reduced her comments to a quote saying the economy was operating in an "inflationary danger zone." Within a few days, headlines were attributing a decline in the Dow Jones to Yellen's statement.
"As a professor, you're not accustomed to censoring your opinions. The only thing you have to worry about is whether a student is going to ask, 'Is this going to be on the exam?' Here, if I say the sky is blue, the stock market moves," she said.
A call from the Treasury interrupted Yellen's methodical train of thought. It was late afternoon, humid compared to Berkeley's perfect early autumn weather, and the 50-year-old wife and mother of a teenage boy turned her focus toward her family.
"I made up my mind early on that my family would remain a priority. We value our family life," said Yellen. "I try to spend some evenings with my son. I typically go home and have dinner with my family."
A typical workday begins at 6 a.m. and ends when Yellen falls asleep, sometime between 10 and 11 p.m. She drives her son, Robert, to school on the way to the office. Economics briefings are held each Monday morning, and a "Treasury Lunch" gathering takes place each Wednesday. "I have something to read virtually every night," she said.
With what little time she has left, Yellen makes it a point to share some of it with her Berkeley colleagues. "We talk about the woes and joys of life here. We talk about who's coming and who's going. We all miss Cafe Roma, we miss the food and we miss our colleagues."
Nostalgia comes easy to Yellen and her Berkeley cohorts. "My husband and I were very happy at Berkeley. My son was happy in school. "But the opportunity to apply ivory tower ideas to the real world is a chance many scholars only dream of.
"When someone offers you the opportunity to put to use what you've taught - I'm sure that's what motivates most academics who come to Washington - you take it. It's a chance to be useful. A chance to get that sense of excitement from direct participation," she said. "It's a dream come true."
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