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Newly installed White House chief of staff Rahm Emanuel and President-elect Barack Obama. Photo by Charles Rex Arbogast of the Associated Press

llinois Rep. Rahm Emanuel has accepted the job as President-elect Barack Obama's chief of staff, a move ensuring that a seasoned Washington insider with deep knowledge of both Congress and the national political landscape will be at Obama's right hand in the White House.

"Though Rahm understands how to get things done in Washington, he still looks at the world from the perspective of his neighbors and constituents on the Northwest Side of Chicago, who work long and hard, and ask only that their government stand on their side and honor their values," Obama said in a statement announcing the move this afternoon.

Of his decision, Emanuel said: "I'm leaving a job I love to join your White House for one simple reason -- like the record amount of voters who cast their ballot over the last month, I want to do everything I can to help deliver the change America needs."

Emanuel was elected to Congress in 2002 to a strongly Democratic Chicago-area seat once held by legendary Ways and Means Chairman Dan Rostenkowski. He rapidly rose through the ranks of the Democratic Caucus -- serving as the chairman of the Democratic Congressional Campaign Committee in 2006 and then as the Caucus Chairman over the last two years.

But, Emanuel's experience prior to coming to Congress as an elected official may be more instructive when seeking to understand what sort of chief of staff he will be.

During the 1988 election cycle, Emanuel served as national field director at the DCCC under then Chairman Beryl Anthony (Ark.) and then spent the better part of the 1990s affiliated in one way or another with the campaign and then presidency of Bill Clinton.

Emanuel oversaw fundraising during the presidential campaign of Clinton and held several positions in the White House, first as political director, then manager of special legislative efforts, and finally as senior adviser.

One former Clinton Administration official compared Emanuel to a defensive end in football. "Very smart, super quick and agile, but getting hit by him, particularly when you were blindsided, felt like being run over by a truck," said the source.

Over those fifteen years as a staffer, Emanuel earned a take-no-prisoners reputation and a nickname -- "Rahmbo" -- to go with it. At times he was blunt to a fault, and alienated some of his administration colleagues.

House Minority Leader John Boehner (Ohio) seized on Emanuel's partisan reputation to condemn the choice.

"This is an ironic choice for a President-elect who has promised to change Washington, make politics more civil, and govern from the center," said Boehner in a statement.

But, Emanuel allies argue that the image of the Illinois Congressman as a partisan brawler is more myth than reality.

Emanuel regularly speaks with current White House chief of staff Josh Bolton and has even attended a baseball game with the Republican. He counts Sen. Lindsey Graham (R-S.C.), one of John McCain's closest allies, and retiring Rep. Ray LaHood (R-Ill.) as friends. And, Emanuel's allies point to SCHIP legislation and a G.I. Bill of Rights as examples of where he worked across the aisle to secure support.

Our sense on Emanuel is that he is the ultimate political pragmatist. He understands that Obama was elected in part (a major part) due to his promise to change the way politics is conducted in Washington. Does that mean Emanuel's tough minded approach to the intersection of politics and policy change? Absolutely not. But it does mean that Emanuel will understand that reaching across the aisle for Republican support is absolutely essential to Obama's political brand and will look for opportunities to do so.

WASHINGTON (CNN) -- Computers at the headquarters of the Barack Obama and John McCain campaigns were hacked during the campaign by a foreign entity looking for future policy information, a source with knowledge of the incidents confirms to CNN.

Workers at Barack Obama's headquarters first thought there was a computer virus.

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The source said the computers were hacked mid-summer by either a foreign government or organization.

Another source, a law enforcement official familiar with the investigation, says federal investigators approached both campaigns with information the U.S. government had about the hacking, and the campaigns then hired private companies to mitigate the problem.

U.S. authorities, according to one of the sources, believe they know who the foreign entity responsible for the hacking is, but refused to identify it in any way, including what country.

The source, confirming the attacks that were first reported by Newsweek, said the sophisticated intrusions appeared aimed at gaining information about the evolution of policy positions in order to gain leverage in future dealings with whomever was elected.

The FBI is investigating, one of the sources confirmed to CNN. The FBI and Secret Service refused comment on the incidents. Watch Brian Todd's report on the investigation. »

The sources refused to speak on the record due to the ongoing investigation and also because it is a sensitive matter involving presidential politics.

As described by a Newsweek reporter with special access while working on a post-campaign special, workers in Obama's headquarters first detected what they thought was a computer virus that was trying to obtain users' personal information.

The next day, agents from the FBI and Secret Service came to the office and said, "You have a problem way bigger than what you understand ... you have been compromised, and a serious amount of files have been loaded off your system."

One of the sources told CNN the hacking into the McCain campaign computers occurred around the same time as the breach into those of Obama's campaign.

Representatives of the campaigns could not be reached for comment on the matter.

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The enormous victory won by Senator Barack Obama in the Presidential race came from the backing of voters desperately unhappy with the state of the economy and eager for new direction from the top.

Many in business, though, still view the President-elect with a wary eye. (Perhaps the markets do as well: The Dow dropped more than 400 points the day after Obama's election.) Indeed, if a recent survey by Chief Executive magazine is any indication, Obama has his work cut out for him in wooing America's executives. In a survey of 751 CEOs published in October, the magazine found that 74% feared the consequences of an Obama Presidency, vs. just 19% who worried about John McCain assuming the Oval Office. The surveyed executives feared that Obama's emphasis on big government and his plans to hike capital-gains taxes on big earners would stifle growth and job creation. They also worried he doesn't understand the links between trade and growth well and that he will not be aggressive enough in solving America's immediate energy crisis.

Obama's backers counter that he has garnered far more support from nationally known business leaders than any previous Democratic Presidential contender—not least of whom is Warren Buffett, the most respected executive in the country, along with Google (GOOG) CEO Eric Schmidt. Penny Pritzker, the Hyatt heiress who was the national finance chair of Obama's campaign, has used her own extensive contacts in the business world to secure C-suite support for Obama. Aides say the strategy, put together with the same meticulous planning as the rest of the campaign, has yielded a network of several hundred business leaders that Obama has increasingly tapped for advice in addition to fund-raising. The CEOs he meets are impressed. "Obama fully understands the importance of investing in people and the ideas and technology they create," says Google's Schmidt.

Business executives and lobbying groups around Washington say that whatever questions or disagreements they might have over the policies Obama is likely to pursue, they are gearing up to work closely with his Administration. Even the staunchly conservative U.S. Chamber of Commerce, which threw its weight heavily behind numerous Republican congressional candidates in the hopes they could help keep the Democratic majorities in check, is sounding a conciliatory note these days. "We're always concerned when a new President comes in, but the business community is a uniquely practical constituency," says R. Bruce Josten, the Chamber's top lobbyist. "We may lose some more battles than we would have gotten in recent years," he adds. "But they're in charge now."

In charge for sure. But now the country—indeed, the world—turns to a new set of questions. Obama takes office facing the most difficult economic challenges since Franklin D. Roosevelt stepped into the White House in the midst of the Great Depression. The Illinois senator campaigned on an ambitious agenda of middle-class tax cuts and a wave of public investment in everything from America's aging infrastructure to the cutting-edge alternative energy research that could someday lessen dependence on foreign oil. At the same time, he has pledged to spend billions fixing the health-care system and making better education available to all.

Yet even as the economy tanked and the financial sector bailout sent the deficit hurtling toward $1 trillion, Obama has offered little insight into how he will accomplish all of those ambitious goals. What are Obama's top economic priorities, and what will he tackle first? How might they change in light of the ever-worsening budget? Will there really be money available to plow into education, health care, and infrastructure—and if so, when will it come?

Emanuel Accepts

Newly installed White House chief of staff Rahm Emanuel and President-elect Barack Obama. Photo by Charles Rex Arbogast of the Associated Press

After emerging from his home in Chicago for an early workout, Obama spent most of the day ensconced in a downtown office building where he held discussions with Vice President-elect Joseph R. Biden Jr.; John D. Podesta, who was President Bill Clinton's chief of staff; Rep. Rahm Emanuel (Ill.); and senior campaign advisers. At his campaign headquarters nearby, aides began stripping posters from the walls and disbanding the sprawling organization that helped propel the senator from Illinois to a decisive victory over Republican John McCain on Tuesday.

Amid new indications of a weakening economy, the president-elect must now decide how to insert himself into the most pressing issues facing the nation over the next 75 days, particularly the global economic summit that President Bush will convene in Washington on Nov. 15 and a new economic stimulus package being pushed by Democrats when a lame-duck session of Congress begins days later.

Leading the Obama-Biden Transition Project are Podesta; Valerie Jarrett, a close friend of Obama's; and Pete Rouse, Obama's former Senate chief of staff. Its work can be monitored online later at www.change.gov. Obama hopes to quickly name a Treasury secretary, a decision that will set the tone for his relationship with the battered financial world, and is expected to name his chief of staff, most likely Emanuel, this week.

In remarks delivered from the Rose Garden, the current occupant of the White House called Obama's election "uplifting."

"It will be a stirring sight to watch President Obama, his wife, Michelle, and their beautiful girls step through the doors of the White House," Bush said. "I know millions of Americans will be overcome with pride at this inspiring moment that so many have awaited so long. I know Senator Obama's beloved mother and grandparents would have been thrilled to watch the child they raised ascend the steps of the Capitol and take his oath to uphold the Constitution of the greatest nation on the face of the Earth." First lady Laura Bush also called Michelle Obama to offer her congratulations.

Bush and Obama showed early signs of cooperation, with the president inviting his successor to visit the White House "as soon as possible" and promising to help make the changeover a smooth one.

With the economic summit on the horizon, a Bush administration official said the White House is "consulting closely with the president-elect's team," but could not say whether Obama or one of his representatives would be included in the meeting with 20 foreign leaders next week. "This effort will obviously straddle the two administrations, and it will be up to the president-elect as to how he would like to have input," the official said.

But in bureaucracies across the government, federal agency chiefs ordered their staffs to welcome the next president's aides and to begin preparing for an influx of appointees, a process that will place special emphasis on the departments of Treasury and Defense at a time when the nation is waging two wars and attempting to stave off further economic decline.

After weeks of speculation about who might fill the Treasury post, financial industry and Obama sources said the list includes Timothy F. Geithner, president of the Federal Reserve Bank of New York, and Lawrence H. Summers, who was Treasury secretary at the end of the Clinton administration and has been a close adviser to Obama on the economy.

Geithner has been deeply involved in the government's response to the nation's economic crisis since it began in September. While he has extensive knowledge of the financial system, he is not as well known to Obama as is Summers.

Obama could also draw from his core economic team, which includes former Treasury secretary Robert E. Rubin, former Federal Reserve chairman Paul A. Volcker, and Laura D'Andrea Tyson, who chaired Clinton's Council of Economic Advisers, the sources said, speaking on the condition of anonymity because they were not authorized to speak publicly for the president-elect.

After a victory of historic significance, Barack Obama will inherit problems of historic proportions. Not since Franklin D. Roosevelt was inaugurated at the depths of the Great Depression in 1933 has a new president been confronted with the challenges Obama will face as he starts his presidency.

Surrounded by excited staffers and supporters, candidate remains his characteristicly calm self.

Eli Saslow | 8:37 p.m. ET