Issue of the week: Does Bernanke deserve another term?
Ben Bernanke's reappointment as Federal Reserve Chairman seemed threatened by a "sudden surge of opposition," but as The Week went to press, the White House appeared to have the votes it needed.
It’s still touch-and-go, but it appears that Federal Reserve Chairman Ben Bernanke will get to keep his job, said Sewell Chan in The New York Times. Bernanke’s eight-year term expires Jan. 31, and in recent days, “a sudden surge of opposition” in the Senate threatened to derail his reappointment. At least 12 senators, Democrats and Republicans alike, came forward to oppose him, Still, “the Senate has never rejected a president’s nominee for chairman since the central bank was created in 1913,” and as The Week went to press, the White House appeared to have the votes it needed. But if Bernanke survives “the populist revolt,” said Colin Barr in Fortune, it will be largely “because of fears that a change will scare the heck out of financial markets.”
That’s a legitimate concern, said Dallas Federal Reserve Bank President Richard Fisher in The Wall Street Journal. The fact is, Bernanke has been used as ���a political punching bag” by Congress, presenting the alarming possibility that going forward, “elected officials will politicize the Federal Reserve and compromise its independence.” Has anyone in Washington considered how global investors would react if they knew that “Congress might seek to pressure the Fed to print its way out of this crisis”? What’s more, bouncing Bernanke now, without an obvious successor, would leave the Fed “rudderless,” said Edmund Andrews in the financial blog CapitalGainsandGames.com. That’s “never a good idea, but especially not when the economy and markets are still fragile.”
Reappointing an incompetent is no way to instill confidence, said John Tamny in RealClearMarkets.com. The Fed’s mandate from Congress is to maintain full employment, low inflation, and a healthy banking system. Under Bernanke, the unemployment rate, which stood at 4.8 percent when he took over from Alan Greenspan, has more than doubled, as has the dollar price of gold, a crucial indicator of inflation. “As for the banking system, its decline while under the allegedly watchful eye of the Bernanke Fed is well documented.” Why should the Senate confirm Bernanke when “the Fed which he oversees has failed miserably”?
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
That’s an excellent question, said Paul Krugman in The New York Times. Although I admire Bernanke “both as an economist and for his response to the financial crisis,” his stewardship of the Fed has been disappointing. Especially on the question of employment, Bernanke has displayed “a dangerous complacency,” saying only that the decline in the jobless rate is going “slower than we would like.” But frankly, it’s hard to imagine anyone who’s better getting through the bitterly divided Senate, and we could easily end up with somebody who could do even more damage. “That’s not a ringing endorsement, but it’s the best I can do.”
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Create an account with the same email registered to your subscription to unlock access.
-
Are 'judge shopping' rules a blow to Republicans?
Today's Big Question How the abortion pill case got to the Supreme Court
By Joel Mathis, The Week US Published
-
Climate change is driving Indian women to choose sterilization
under the radar Faced with losing their jobs, they are making a life-altering decision
By Theara Coleman, The Week US Published
-
'A great culture will be lost if the EV brigade gets its way'
Instant Opinion Opinion, comment and editorials of the day
By Harold Maass, The Week US Published
-
Trump, billions richer, is selling Bibles
Speed Read The former president is hawking a $60 "God Bless the USA Bible"
By Peter Weber, The Week US Published
-
The debate about Biden's age and mental fitness
In Depth Some critics argue Biden is too old to run again. Does the argument have merit?
By Grayson Quay Published
-
How would a second Trump presidency affect Britain?
Today's Big Question Re-election of Republican frontrunner could threaten UK security, warns former head of secret service
By Harriet Marsden, The Week UK Published
-
'Rwanda plan is less a deterrent and more a bluff'
Instant Opinion Opinion, comment and editorials of the day
By The Week UK Published
-
Henry Kissinger dies aged 100: a complicated legacy?
Talking Point Top US diplomat and Nobel Peace Prize winner remembered as both foreign policy genius and war criminal
By Harriet Marsden, The Week UK Last updated
-
Trump’s rhetoric: a shift to 'straight-up Nazi talk'
Why everyone's talking about Would-be president's sinister language is backed by an incendiary policy agenda, say commentators
By The Week UK Published
-
More covfefe: is the world ready for a second Donald Trump presidency?
Today's Big Question Republican's re-election would be a 'nightmare' scenario for Europe, Ukraine and the West
By Sorcha Bradley, The Week UK Published
-
Xi-Biden meeting: what's in it for both leaders?
Today's Big Question Two superpowers seek to stabilise relations amid global turmoil but core issues of security, trade and Taiwan remain
By Harriet Marsden, The Week UK Published