As relations between Truman and his budget director became more intimate, Webb emerged as a principal adviser to the president, as distinct from adviser to the presidency, the prime role assumed by past directors. Neustadt reported that Webb “broke precedent by making his subordinates freely available to White House aides, on their terms, for their purpose.” The Clifford-Murphy axis in particular used Budget Bureau people as its personal backup staff. The interchange of personnel was such that, according to Neustadt, “in 1953 fully a third of the outgoing Truman assistants had come to the White House staff from the career service in the Budget Bureau.” Starting in 1948 the bureau’s legislative clearance operation moved from “negative protection of president and agencies to positive development and drafting of Administration measures.”17 Policy often was formulated by working teams, with the bureau’s Legislative Reference Office functioning as secretariat. Only the advent of the Korean War and the usual loss of energy that afflicts an administration whose days in office are numbered caused some diminution of the Budget Bureau’s influence.
While Truman was in the White House, Congress sought for the first time to shape the institutional presidency. The Employment Act of 1946 added the Council of Economic Advisers to the Executive Office and the National Security Act of 1947 added the National Security Council.18 Both were attempts to structure in statute the president’s information systems. But although Congress could mandate advice, could a president be forced to listen?
At least one economist has called Harry Truman “indifferent to the complexities of economics.”19 In this regard he was no different from his predecessor, or for that matter from most of the presidents who have come after him. No professional economist has ever been a major party candidate for president. Rexford Tugwell had proposed that Roosevelt create a federal economic council attached to the executive.20 Roosevelt instead chose to gather economic advice from his constantly shifting inner circle, some of whose members were economists. His several changes in economic policy may be attributed to changes in advisers. As a posthumous reaction to his ways of conducting the affairs of state, Congress decreed in 1946 that, starting with Truman, presidents would have to have a pride of professional economists in the Executive Office. A president’s economic advice would come from a council, not a solitary adviser, and its three members would be confirmed by the Senate, a provision that had never before been attached to presidential aides. A new joint committee of Congress would monitor the council’s recommendations. Senator Joseph C. O’Mahoney, a principal supporter of the measure, made his intention clear: “This … is a bill to restore the functions of Congress.”21
For the first chairman of the Council of Economic Advisers, Truman chose Edwin G. Nourse, vice president of the Brookings Institution and generally regarded as a moderate conservative. The other two members, John D. Clark and Leon Keyserling, were liberals. Nourse reported,
After the lapse of a little more than a year, it can be said that there has been no single case when [Truman] has called upon us in any specific situation for counsel in his study of any matter of national economic policy. While he has accepted the material which we have presented to him for use in the Economic Report and passed it on without material change and with only minor omissions, there is no clear evidence that at any juncture we had any tangible influence on the formation of policy or the adoption of any course of action or feature of a program.22
This situation had at least three causes. Nourse was not in sympathy with the policy tendencies of the administration. At the same time, he believed presidential economic advisers could and should be “scientifically objective,” somehow outside the political implications of their data. And there was an unfortunate chemistry between chairman and president. Keyserling would later contend that “Dr. Nourse was simply unable to adjust himself to the nature and the problems of the Presidency. He could never understand that the president of the United States has too many things to do to engage in long bull sessions on economics of the kind that take place at The Brookings Institution.”23 Viewing the relationship from the president’s perspective, Gerhard Colm, a member of the initial CEA staff, thought that perhaps Truman kept his distance because “he did not feel equal to discussing economics with a man whom he respected as a great scholar and authority.”24
After Nourse resigned in 1949 and the chairmanship was assumed by Keyserling, whose views of the White House operation were more realistic and whose views of policy were more in tune with the president’s, the council became a serious contending force in devising administration policy. Unlike the Budget Bureau, which had a monopoly in its primary area of concern, the CEA still had to negotiate with the Treasury, Commerce, and Labor departments and the other elements of government that took strong stands on the direction of the economy. However, freed of operating responsibility (with the exception of preparing the economic report) and located in proximity to the president, it had ample opportunity to develop and to expound its judgments within the higher reaches of the administration. Moreover, the council was given a small but competent staff, eight professionals at first, most drawn from the ranks of government economists. Their networks of friendships were invaluable in keeping the CEA in touch with the agencies and in avoiding the type of insensitivity that could have hampered a new entry in a crowded field. Harold Smith, for example, expected bad blood to develop between his Budget Bureau and the new council; that did not happen, and it was not insignificant that two of the early CEA staff members came from the bureau.
Congress was wrong in its belief that it could direct the president to accept economic advice; the experience with Nourse graphically proved that. But it was right in believing that the presence of professional economists in the White House could result in additional sources of information and analysis, which the president absorbed, often through his personal staff, sometimes by osmosis. The lesson of the CEA was that a president could be aided in policymaking by this type of expertise if his experts were congenial enough to gain his attention—this could not be taken for granted—and if they could provide him with information that was immediately and politically useful. Ironically, it was Nourse who correctly summed up the CEA’s proper role: “The success of the Council as an institution, the importance of the place it occupies and the value of its work will be just what the president makes them.”25
The National Security Act of 1947 and its 1949 amendments were meant to unify the military and to create a new system for advising the president—the National Security Council. The original members of the NSC were the president (chairman), the secretary of state, the secretary of defense, the three military service secretaries (who were at the same time removed from the cabinet), the chairman of the new National Security Resources Board (a standby mobilization body that was later merged into the Office of Defense Mobilization), and such other department or agency heads as the president might choose to give membership. The 1949 amendments dropped the service secretaries and added the vice president. The Central Intelligence Agency was placed under the NSC, but it has never really been regarded as part of the Executive Office. In theory, the NSC would help the president define broad national policy. The State Department would then know what policy to implement in its conduct of foreign relations, the military would know the policy for which it must devise strategic and logistic plans, and the National Security Resources Board would know the policy for which it must prepare mobilization plans for industry, labor, and raw materials.
Truman at first viewed the NSC with appropriate suspicion. There were some, particularly in the Pentagon, who hoped to use it as a vehicle for committing the president to their department’s positions. Truman had to make sure that the council would be limited to giving advice. He chose to accomplish this in part by not attending council meetings: if he was not there, he could make no instant commitments, although he justified his absence by contending that council members would speak more freely if he was not in the room. He rejected a proposal to give the executive secretary