President Obama Picks Bill Daley as Chief of Staff

WASHINGTON, Jan. 6, 2011— -- President Obama today announced the appointment of former commerce secretary William Daley as White House chief of staff.

Daley is "an experienced public servant, devoted patriot, my friend, fellow Chicagoan," Obama told a roomful of staff members and supporters at the White House. "Few Americans can boast the breadth of experience that Bill brings to this job."

Obama's choice of Daley to replace outgoing chief of staff Rahm Emanuel is the first in a handful of senior White House staff changes since the start the new year, reflecting the new political realities in Washington and early preparations for a re-election battle in 2012.

The shake-up effectively retools the public face of the administration, with three of the most highly visible members of Obama's closest inner circle -- Rahm Emanuel, Robert Gibbs and David Axelrod -- all departing as Obama heads into the second half of his first term.

Emanuel left as chief of staff in October to run for mayor of Chicago. Gibbs announced Wednesday he would step down as press secretary to become a private sector adviser. And senior aide Axelrod is likely to soon follow suit.

The list of replacements and possible replacements is dominated by experienced Washington insiders, many with track records of bipartisan deal-making. Whoever Obama picks will help set the tone for negotiations with lawmakers on Capitol Hill and chart a course for advancing the administration's agenda.

With many of the open posts expected to be filled within days, here's a look at the senior staff members who are on the way out -- and some of their likely replacements:

Out: Chief of Staff Rahm Emanuel

Emanuel, a former congressman from Illinois, had been unabashed about his desire to run for mayor of the Windy City. So when longtime Mayor Richard Daley announced in September that he would not seek another term, the door opened for Emanuel's return to his hometown.

A recent Chicago Tribune poll shows Emanuel the early front-runner in the race.

"I think he would be an excellent mayor," Obama said of his former chief of staff in an interview late last year.

Replacement:

William Daley, Former Commerce Secretary

Daley, the former Clinton commerce secretary and JP Morgan Chase executive, assumes the reins from interim chief of staff Pete Rouse, who will be promoted to counselor to the president.

"He possesses a deep understanding of how jobs are created and how to grow our economy," Obama said of Daley. "And needless to say, Bill also adds a smidgen of awareness of how our system of government and politics works. You might say it is a genetic trait."

Daley, who has strong ties within the business community, was considered a top choice for working with Republicans and signals the president's willingness to move to the center.

The U.S. Chamber of Commerce praised Obama's selection of Daley, calling it a "strong appointment."

But some liberal groups suggested bringing in Daley was akin to letting a wolf into a hen house.

Justin Ruben, executive director of MoveOn.org, said the move "sends the wrong message to the American people...Its 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."

The seventh and youngest child of the late Chicago Mayor Richard J. Daley, he may be best known for not conceding on election night when he was the campaign chairman for Al Gore's 2000 presidential campaign.

Out: Press Secretary Robert Gibbs

Gibbs announced Wednesday that he would be leaving the White House in February.

"It is an honor and a privilege to stand here, to work inside this building, to serve your country, to work for a president that I admire as much as President Barack Obama," Gibbs told reporters at his regular briefing. "What I'm going to do next is step back a little bit, recharge some."

"This is a tough place to work. ? I think having new voices and having fresh voices, some of those voices that are coming back from having taken a couple of years off, are an important part of this process," Gibbs said.

Gibbs said he would continue to support the administration from the private sector, offering advice as a paid consultant to the re-election campaign.

Possible Replacements:

Bill Burton, Deputy Press Secretary

Burton is seen as the favorite to become the new public face of the administration, given his Gibbs' training and experience as Obama's national press secretary during the 2008 presidential campaign. The 33-year-old has also held communications posts on Capitol Hill.

The New York native is well-regarded by members of the White House press corps for his engaging and affable manner. But he's also demonstrated, both from the podium and the sidelines, that he can be a forceful defender of his boss and the administration.

Josh Earnest, Deputy Press Secretary

Earnest, a Kansas City native, has served in the White House communications shop since the inauguration in 2009. He previously held Obama communications roles during the presidential campaign, heading the Presidential Inaugural Committee and the Iowa communications office.

Jay Carney, Communications Director for Vice President Biden

Carney, a Virginia native, has been a journalist and before he joined the administration, he had been the Washington bureau chief for Time magazine.

Out: National Economic Council Director Larry Summers

Summers, Obama's top economic adviser, announced his departure from the White House in September, following the exit of two other economic advisers, chair of Council of Economic Advisers, Dr. Christina Romer and Office of Management and Budget director, Peter Orszag.

He will return to Harvard University as a professor. "I'm looking forward to returning to Harvard to teach and write about the economic fundamentals of job creation and stable finance as well as the integration of rising and developing countries into the global system," Summers said in a statement.

Replacement:

Gene Sperling, Treasury Department official

White House officials say President Obama will appoint Sperling, a deficit hawk with close ties to the business and financial community, to replace Summers as the head of the National Economic Council on Friday.

Sperling was perviously director of the Council between 1996 and 2000, during Bill Clinton's second term.

Out: David Axelrod, Senior Adviser

Axelrod, one of the president's closest aides, has said he would move back to Chicago in 2011 to help coordinate Obama's re-election campaign. He has made no secret of his desire to be closer to his family in Chicago, where he travels often. It's unclear whether Axelrod would continue in a formal support role for the administration after the 2012 campaign.

In: David Plouffe

Plouffe, Obama's campaign manager during the 2008 election, assumed his new job as senior White House adviser Monday,.

"Plouffe is one of the smartest guys in the business. He has the full trust of the president and his team, and we appreciate any and all help he can give us," White House communications director Dan Pfeiffer said of Plouffe last year.

ABC News' Jake Tapper and Jon Garcia contributed to this report.