President Obama introduces William Daley as his new chief of staff. (Brendan Smialowski / Bloomberg )
Reporting from Washington — President Obama has recast his White House team for the second half of his term, giving top jobs to a pair of Clinton-era veterans in a signal to business leaders and independent voters that he is resolved to steer a more centrist course after two years of intense partisan clashes.
Obama announced Thursday that he was installing William Daley as chief of staff, entrusting the White House operation and perhaps the future of his presidency to a former Commerce secretary who has warned that pressing a liberal agenda risks scaring away an all-important bloc of moderate voters.
Obama on Friday will name Gene Sperling as his chief economic advisor, turning again to a Clinton alumnus who has experience working with a Republican majority, the reality that now confronts Obama with GOP control of the House.
Sperling, until now a counselor to Treasury Secretary Timothy F. Geithner, will move into the same job he held under President Clinton from 1997 to 2001, director of the National Economic Council. He will replace Lawrence H. Summers, who is returning to Harvard University.
With former Obama campaign manager David Plouffe starting work as a senior White House advisor next week, the president's new leadership team is largely set for what is expected to be a volatile two years, culminating in the 2012 presidential election.
One remaining spot to be filled is that of White House press secretary; Robert Gibbs will step down next month to become a private consultant.
Daley, 62, is Obama's third chief of staff in two years. He follows another Chicagoan, Rahm Emanuel, who left in October to run for mayor of the city, and Peter Rouse, who is stepping aside to serve as a senior counselor.
Obama's move is in keeping with a turn toward the political center following the walloping his party got in the 2010 midterm election, when it lost control of the House.
Since then, Obama has abandoned his previously held position on tax cuts for the wealthiest Americans, struck deals with Republicans and attempted to repair a frayed relationship with the business community.
In picking Daley, an executive at JP Morgan Chase, Obama is cementing the new approach.
"With what he's done in government and what he's done in business, he understands the things that can bring [Obama] more toward the middle, exactly as Bill Clinton did," former House Speaker J. Dennis Hastert, an Illinois Republican, said of Daley. "But look, Bill Daley isn't only a good businessman; he's a good politician."
Daley wrote an influential op-ed piece late in 2009 that cautioned Democrats not to veer too far left. The article appeared at a time when Obama and the Democratic Party were fighting hard to pass a healthcare overhaul bill. Daley warned that Obama's poll numbers showed independents were turning away from the president. Inside the White House, aides are worried about the same trend.
"He [Daley] has never been anything other than a Democrat, but he believes deeply that the only way for Democrats to win majorities at the national level is to articulate a message and have a set of policies that is resonant with moderates and independent voters," said Matt Bennett, vice president of Third Way, a moderate Democratic think tank on whose board Daley serves.
At an East Room ceremony Thursday, Obama was flanked by Daley and Rouse. When Emanuel resigned, Obama named Rouse to the top staff job on an interim basis. He then asked Rouse to review the entire White House operation. An outgrowth of that review was Rouse's recommendation that Daley be named permanent chief of staff.
Rouse is a popular figure inside the building. The ovation he received from the assembled staff when Obama thanked him was louder than the one given Daley.
Few White House aides were even aware that Obama was courting Daley; many hoped Rouse would take the job permanently. But the limelight-averse Rouse wasn't comfortable in the role, and Obama wanted to add a fresh voice to his senior team, one senior administration official said, speaking on condition of anonymity when discussing personnel moves.
The Daley appointment is unusual for Obama in that he doesn't normally add strange faces to his inner circle. Daley is not close to Obama personally.
He is friends, though, with two important people in Obama's orbit: Emanuel and senior advisor David Axelrod. The two have talked with Daley by phone since Obama took office and have dined with him in Chicago. Emanuel served with Daley in the Clinton administration. And Axelrod has been close to the Daley family for years, devising strategies for brother Richard M. Daley's mayoral campaigns.
Daley's arrival is a setback for Obama's political base. On the left, critics say Daley is tied to Wall Street and apt to favor business interests. Daley is a former president of the telecommunications giant SBC. He also served on the board of the mortgage finance company Fannie Mae.
"Americans are looking to the White House for economic plans that will create jobs and rein in Wall Street's excesses, and it's up to Daley to prove that he's not carrying water in the White House for the big banks that took our economy over the cliff," said Justin Ruben, executive director of MoveOn.org, in a statement.
Republicans sought to play up the intraparty split. The Republican National Committee sent an e-mail noting that two Democratic senators last fall called for an investigation into whether Daley's company, JP Morgan Chase, may have contributed to a spate of illegal home foreclosures.
Christi Parsons and Jim Puzzanghera of the Washington bureau and Chicago Tribune staff writer Rick Pearson in Chicago contributed to this report.