Wasn't Warren Burger a circuit judge when Nixon tapped him to replace Earl Warren?
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Yes--and Earl Warren before him was Governor of California (either when appointed or just before.) So, 2 of the last 3 CJ's were from outside the court. (Sorry, my knowledge doesn't go further back!)
Don't recall -- but yes, a President could nominate anybody for chief justice. More typically, I believe it would be a current court member. How 'bout Robert Bork? :D