Ending months of speculation, the White House announced last night that Freed Professor of Economics N. Gregory Mankiw will be taking over as the chair of President Bush’s Council of Economic Advisors.

The high-profile Harvard economist who is author of one of the most-used economic textbooks in the country has no easy job ahead.

The administration faces a recession, a war and heavy opposition to its proposed tax plan.

The announcement of Mankiw’s new post came in a White House press release, just minutes after current chair R. Glenn Hubbard, who engineered the Bush tax plan, said he would step down at the end of the week.

The announcement apparently came as no surprise to the Harvard economics department.

“We’ve known about this for weeks,” said Lee Professor of Economics Claudia Goldin, who explained that the announcement could not be made until the White House had taken care of formalities. “It’s neither breaking nor news.”

While they say that he will be sorely missed in Cambridge, Mankiw’s colleagues say they have confidence in his ability to advise the president through tough economic times.

“Gregory Mankiw is a terrific economist with a keen interest in public policy,” University President Lawrence H. Summers said through a spokesperson. “Harvard’s temporary loss as he goes on leave will be the country’s gain.”

As a graduate student, Mankiw served as an assistant to Summers, then an economics professor.

Baker Professor of Economics Martin S. Feldstein echoed Summers’ sentiments.

“Greg is a first-rate economist and he will do an excellent job as chair,” said Feldstein, who was chair of the council under President Reagan, while Mankiw was working on the council’s staff in 1982 and 1983.

Feldstein’s introductory course, Social Analysis 10, “Principles of Economics,” uses a textbook by the same name, Principles of Economics, authored by Mankiw.

“He’s a wonderful economist and we’re going to be very sad to lose him,” said Oliver Hart, chair of the economics department.

Three economists, each selected by the president, serve on the Council of Economic Advisors.

Professor of Economics David I. Laibson said the council fills three functions: it operates as a “sounding board” for economic policies proposed by the president; it initiates new ideas and economic policies; and it serves as a liaison between the president and Congress, the public and the United States’s allies.