WASHINGTON — President-elect Joseph R. Biden Jr. named two senior officials from the Obama White House to key jobs on Thursday, putting Susan Rice, a former national security adviser, in charge of his Domestic Policy Council and nominating President Barack Obama’s chief of staff, Denis McDonough, to be secretary of veterans affairs.
Both choices came as surprises, particularly the decision to place a lifelong national security professional like Ms. Rice into a top domestic policy job. At the same time, they reflect Mr. Biden’s desire to populate the upper levels of his incoming administration with people he knows well, and with whom he has worked closely in the past.
The appointment of Ms. Rice also helps Mr. Biden meet his commitment to diversity by installing a Black woman in a White House post with major influence over a wide range of federal policies, from education to health care to racial equity.
Like Ms. Rice, Mr. McDonough, who if confirmed will take over the Department of Veterans Affairs, a politically important agency long known for dysfunction and scandal, has a national security background. He served as a foreign policy aide on Capitol Hill and then as President Barack Obama’s deputy national security adviser before becoming his chief of staff.
During the Obama administration, both Mr. McDonough and Ms. Rice spent countless hours with Mr. Biden, then the vice president, in the Oval Office and the Situation Room. People familiar with their selection said the president-elect sees them both as tenacious managers with a deep understanding of the federal bureaucracy.
Ms. Rice’s friendship with Mr. Biden led to speculation that he would choose her as his running mate, but he picked Senator Kamala Harris of California instead.
Though Mr. McDonough’s selection was unexpected, former colleagues said he took an intense interest in military families during the Obama administration, as well as the notorious case backlog at the sprawling department that manages health care and other benefits for veterans. He also traveled regularly to combat zones, and often visited with wounded soldiers at Walter Reed National Military Medical Center. Mr. McDonough’s wife, Kari, is the co-founder and president of an organization that assists veterans reintegrating into their communities.
“If you know Denis McDonough, there is nothing at all surprising about the idea that the V.A. would literally be the guy’s dream government position,” said Ben Rhodes, a deputy national security adviser in the Obama White House. “He’s animated by veterans’ issues in a way that he’s not animated by anything else, including national security issues.”
Mr. Rhodes recalled many instances when he would “round a turn in the West Wing at like 9 p.m. on a Tuesday and the guy was giving a tour to 10 wounded warriors.”
Mr. McDonough, 51, would be just the second leader of the Department of Veterans Affairs since it supplanted the Veterans Administration in 1989 not to have served in the military. The other was President Trump’s first secretary, David Shulkin, whom the Senate confirmed by unanimous consent.
The appointment of Ms. Rice, 56, was an even greater surprise. Many longtime domestic policy experts within the Democratic Party complained privately on Thursday that Mr. Biden had passed over candidates with direct experience on issues like education and the economy.
A graduate of Stanford and a Rhodes scholar, Ms. Rice joined President Bill Clinton’s National Security Council staff in 1993 and went on to become an assistant secretary of state for African affairs. She returned to government under Mr. Obama, first as his ambassador to the United Nations and then as national security adviser, a job she held for four years.
After leaving government with the election of Mr. Trump, Ms. Rice became a contributing opinion writer for The New York Times for three years. Her last column for The Times was published on Dec. 1.
She has twice been a finalist for secretary of state, first under Mr. Obama and more recently as Mr. Biden assembled his national security team. But she was twice passed over, in part because of concern over a potentially bloody confirmation fight.
Republicans targeted Ms. Rice for comments she made shortly after the Sept. 11, 2012, attack on a U.S. consulate in Benghazi, Libya, downplaying terrorism as a motive. In an election year, they turned the attack into a major political issue, singling out her and Hillary Clinton, then the secretary of state. Allies of Ms. Rice said she was the victim of smears and discrimination and noted that congressional inquiries found no wrongdoing on her part.
Ms. Rice’s new position does not require Senate confirmation. In a statement announcing her appointment, Mr. Biden’s transition team said that she “knows government inside and out and will carry through the president-elect’s vision of a newly empowered Domestic Policy Council and turbocharge the effort to build back better.”
Established in 1993, the Domestic Policy Council — much like its national security counterpart that Ms. Rice managed — coordinates domestic policymaking across the federal government, with the exception of the many economic matters overseen by the National Economic Council.
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Mr. Rhodes said that Ms. Rice had worked extensively as national security adviser on issues that straddled the foreign and domestic realms during the Obama administration, including a flood of migrant families at the southern American border and an Ebola outbreak in Africa. “National security and domestic lines have been blurred,” particularly since the advent of the coronavirus, sure to be one of her top priorities, he said.
Melody Barnes, who led the Domestic Policy Council under Mr. Obama, said Ms. Rice had the essential bureaucratic know-how required to run the body effectively and noted that she would be supported by a formidable staff of experts.
“She’s an intellectual powerhouse,” Ms. Barnes said. “She has extensive government experience and knows how to manage a process, and work with departments and agencies, which is an essential part of the director’s job.”
Ms. Rice comes from a family of domestic policy enthusiasts. Her mother, Lois Rice, was an education policy expert often called “the mother of the Pell grant” because of her key lobbying role behind the federal college subsidy created in 1965.
A pioneering Black woman in government, Ms. Rice also has a keen issue in racial justice. Ms. Barnes noted that the Domestic Policy Council would play a central role in Mr. Biden’s efforts to advance racial equity.
A tour of duty in domestic affairs could also help position Ms. Rice for a future run for office. She recently contemplated a run for Senate in Maine, a state where she has family roots, and was a finalist to become Mr. Biden’s vice-presidential running mate.
Like Ms. Rice, Mr. McDonough, a graduate of St. John’s University in Minnesota and the Georgetown School of Foreign Service, is known as a demanding, hard-nosed manager impatient with confusion and delay. If confirmed, he will oversee a department whose vast size is matched only by its seemingly intractable problems.
It is the government’s second-largest department, with around 375,000 employees and a budget of more than $200 billion that funds a troubled health care system that underwent immense strain after the invasions of Iraq and Afghanistan. Mr. Biden’s hope is that Mr. McDonough can apply the management acumen he developed as chief of staff to making the troubled department more efficient and effective.
During the Obama administration, officials at a Phoenix medical center were found to have manipulated data concerning long wait times for veterans that may have led to patient deaths. That led to the departure of Eric Shinseki, the secretary at the time, and Mr. McDonough helped shepherd legislation to give veterans access to care outside the department’s system.
Mr. Rhodes said Mr. McDonough became “obsessed” with cruelly long wait times for health care and made it a top priority when he served as chief of staff.
Mr. Trump put the troubled department at the center of his own political agenda, and pushed hard to expand veterans’ access to private care. His most recent secretary, Robert L. Wilkie, shunned traditional veterans organizations and many lawmakers in favor of conservative groups that championed private care, notably Concerned Veterans for America, an advocacy group with ties to the billionaire industrialist brothers Charles G. and David H. Koch.
The department became deeply politicized and faced additional problems caused by an expensive electronic medical records system, the rollout of its expanded community care program and an inspector general’s report highly critical of Mr. Wilkie’s handling of a reported sexual assault case at a department hospital.
In a statement, Will Fischer, a senior adviser to the liberal veterans’ group VoteVets, acknowledged that few had seen Mr. McDonough’s selection coming. “Some may say this pick is unexpected and out of left field,” he said, but called the choice “a grand slam.”
“What the V.A. needs, more than anything, is an experienced manager, with deep depth of knowledge about how the agency works, how it interacts with other agencies and how to quickly build the agency back, even better,” he said.
Mr. Biden plans to introduce Mr. McDonough and Ms. Rice at a public event in Wilmington, Del., on Friday afternoon.
Michael D. Shear, Jennifer Steinhauer and Jim Tankersley contributed reporting.