photo: rin3y via Flickr

photo: rin3y via Flickr

Politico had a catch-up article about the interesting coalition opening up around Ben Bernanke’s re-appointment and issued of Fed transparency. I say a “catch-up” article because they’re just getting to where I was five days ago. Nonetheless, they have some interesting additions to this.

I was amused by Jim DeMint’s palpable fear about being on the same side as Bernie Sanders in any debate:

“It’s very scary,” said DeMint, a darling of the tea party movement, when asked how he feels finding himself on the same side of the Fed issue as Sanders. But it didn’t give him pause about signing on to Sanders’s audit-the-Fed bill, which has 30 co-sponsors and mirrors the measure sponsored in the House.

“I’ve never seen so much agreement on hardly anything,” DeMint said. “When a man’s right, they’re right.”

Interestingly, here’s an issue where there is that vaunted “bipartisanship” that all the Villagers supposedly seek. But this is the wrong kind of bipartisanship because it attacks the establishment status quo, and we can’t have that.

There have been cracks in the facade, however. In particular, Bernanke’s head-scratcher of a confirmation hearing, when he opined on fiscal policy by saying that Congress should cut Social Security rather than stimulate job growth, has only increased the anger over his re-appointment. Even Paul Krugman had to chide the man who formerly hired him at Princeton for his ill-advised remarks.

The stimulus has already had its maximum impact on growth — and there’s no sign that private final spending is ready to pick up the slack […] Bear in mind also that fiscal policy is slow to get underway. Waiting to be absolutely, totally sure that we really need more strikes me as deeply irresponsible.

This was a very unhelpful statement.

Today, Bernanke gave a speech of “frequently asked questions” at the Economic Club of Washington, DC. He predicted that the economy would grow modestly in the next year – “sufficient to bring down the unemployment rate, but at a pace slower than we would like.” And then he managed to not mention one way where he would be able to bring unemployment reductions toward a pace more to his liking, even while saying that the Fed’s mandate is “to promote price stability and maximum employment.”

In fact, a good portion of the rest of the speech was about how to control inflation (which isn’t happening right now) and exit from its monetary policy actions.

It would be nice if we had a Federal Reserve chairman who, when he cites the Congressional mandate “to promote price stability and maximum employment,” actually means it.

UPDATE: Jeff Merkley (D-OR) says that he is “still wrestling” with whether or not to confirm Bernanke for a second term. No word on whether he would seek to delay cloture on the bill.

David Dayen

David Dayen