Thursday, January 21, 2010

Bernanke on the Outs too?

(Hat tip to MS.)

Roll Call has a piece. So does the WSJ and Huffpo , which is below.

From the Huffpo:

Opposition To Bernanke Growing In Wake Of Mass. Vote: Sanders

UPDATE: HuffPost's Jeff Muskus and I polled as many senators as we could find Thursday after posting this story.The question: Would they commit to reconfirming Federal Reserve Chairman Ben Bernanke.

We found 26 senators in all. Half were undecided; one wouldn't say; three were outright nays; only nine were firmly in the aye column.

Sen. Barbara Mikulski (D-Md.) summed it for many of her colleagues: The decision, she said, "gives me heartburn."

Along with Mikulski, eight other Democratic senators said they are undecided, including Maria Cantwell (Wash.), Ben Cardin (Md.), Patrick Leahy (Vt.), Carl Levin (Mich.), Amy Klobuchar (Minn.), Bill Nelson (Fla.), Bob Casey (Pa.), Barbara Boxer (D-Calif.) and Debbie Stabenow (Mich.).

Sen. Jay Rockefeller (D-W.V.) declined to say which way he would vote or whether he's made up his mind.

Republican Sens. Kit Bond (Mo.), John McCain (Ariz.) and Olympia Snowe (Maine) also said they are undecided.

The nine yes votes: Democrats Tom Carper (Del.), Kent Conrad (N.D.), Daniel Inouye (Hawaii), Paul Kirk (Mass.) and Mark Warner (Va.), plus Republicans Susan Collins (Maine), George Voinovich (Ohio) and Lindsey Graham (S.C.), along with independent Joe Lieberman (I-Conn.) all said they'd vote to confirm Bernanke.

The undecideds cited Bernanke's role in the financial collapse. "Usually at this stage of a vote like that, you have a better sense about it. I'm clearly and definitively undecided," said Casey. "Part of it is just how we analyze his stewardship at the time when our economy began to go in the wrong direction."

Story continues below

Sen. Byron Dorgan (D-N.D.) said he's voting no unless Bernanke tells Congress "who got direct loans from the Fed," he said. "He's essentially said to us he doesn't intend to tell the congress or the American people which investment banks got direct loans from the Fed for the first time in history."

Sen. David Vitter (R-La.), who opposes Bernanke, said he thinks Democrats might sacrifice him him to distance themselves from the White House. "I do think more people -- Democrats, in particular -- are looking for separation from the administration on votes, so that could be a factor," Vitter said.

Sen. Bob Corker (R-Tenn.), a leading Republican on financial issues, said that while he backed Bernanke in committee, he is reserving judgment for the floor, but leaning toward support. "I talked to Ben this morning," said Corker. "I've shared with him, I think this AIG situation has certainly created some issues....You'd have to be sort of not alive to realize, no doubt, this AIG situation certainly has been damaging to the Fed."

McCain, who has said he believes that his presidential campaign was undone in large part by the financial meltdown, cited it as a reason to pause. "I do think the case is being made that his policies were a major contributor to the meltdown," he said.

Stabenow said much the same. "I certainly have question about his role in what got us to the point where we had the financial collapse," she said.

Sen. Richard Shelby (R-Ala.) has made up his mind and is firmly opposed. "I was a Fed defender for 22 years -- probably one of the biggest ones on the banking committee," he said. "Once I got into the weeds on the Fed's role as a regulator dealing with the holding companies, their regulatory regime, and their record was weak and flawed and that is my beef right now."

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

Martha Coakley and the Democratic supermajority in the Senate may not be the only casualties of the Massachusetts special election upset on Tuesday that sent Scott Brown to Washington.

Federal Reserve Chairman Ben Bernanke was originally scheduled for a vote on his confirmation Friday and was assumed to have the votes.

But on Wednesday, Sen. Bernie Sanders (I-Vt.), a Bernanke opponent, said that opposition was growing against his re-confirmation.

And on Thursday Jim Manley, senior communications adviser to Senate Majority Leader Harry Reid (D-Nev.), said that the vote had not been firmly locked in and won't take place this week. A spokeswoman for the Federal Reserve referred questions to the Senate.

Reading too much into the delay could overstate its immediate significance -- the Senate has a lot on its mind, after all -- but the populist rage against Wall Street now casts a once-secure confirmation in some doubt.

The election in Massachusetts has senators who previously considered themselves safe watching their backs, and they don't relish the prospect of a vote in favor of a man who failed to foresee the financial crisis and is closely associated with Wall Street.

A recent poll found that 47 percent of Americans think Bernanke cares more about Wall Street than Main Street, while only 20 percent think he works for Main Street. Independents, who swung heavily for Brown in Massachusetts, are even more opposed to Bernanke than Democrats or Republicans. Fifty percent of independents think he cares first about Wall Street; 15 percent think he prioritizes the needs of Main Street. That's a difficult vote in the face of an angry public.

If Bernanke is confirmed, he'll have to rely on the same coalition that moved the bailout through Congress, when the leadership of both parties joined forces to oppose the rank and file.

The combined leadership of the two major parties may still be able to push Bernanke's confirmation through, but Sanders said he sees a growing movement in a new direction.

"I sense that many Democrats see the Massachusetts election as a wake-up call," Sanders said. "There is a growing understanding that our economy is in severe distress, a greater appreciation that people are disgusted with the never-ending greed on Wall Street, and a better recognition that we need a new direction at the Fed."

Sanders said that Bernanke's record doesn't warrant a new term. The Federal Reserve has four main responsibilities: to maximum employment and prevent inflation; to keep the financial system from imploding; to maintain the safety and soundness of financial institutions; and to protect consumers against deceptive and unfair financial products.

Bernanke has gotten high marks in general for his response to the crisis, but has refused to say what institutions the Fed has provided money to. Unemployment remains high -- it has doubled during Bernanke's term -- and the Fed failed to do any consumer protection. The system imploded on his watch and nearly brought down the global economy. More than 140 banks, including major financial institutions, have collapsed during his tenure.

"People do not want another term for the man whose major job as Fed chairman was to protect the safety and soundness of our financial system but instead was asleep at the switch," Sanders said. "I am confident that more and more senators understand that we need a new Fed and a new Wall Street and will oppose Bernanke's confirmation."

Bernanke's term expires on January 31.

1 comment:

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