President Obama and the U.S. Senate have made a terrible decision in reconfirming Fed Chairmen Benjamin Bernanke.
Like a host of a bad keg party, Bernanke has been a direct catalyst in creating our economic troubles, and now we are looking to him to help clean up the mess. But just as a case of whiskey canâ€™t cure alcoholism, Bernankeâ€™s solutions just donâ€™t work.
Whenever presented with an economic problem, Bernankeâ€™s solution has been more credit. After the 9/11 attacks, Bernanke supported former Fed Chairmen Greenspanâ€™s harebrained idea of cutting interest rates to nearly zero in hopes of creating an economic recovery.
What we got then was the â€œjobless recoveryâ€ under President Bush, where, through a combination of budget-crippling tax cuts and inflation, we got minor economic growth without increasing the actual wages or standard of living of average Americans.
This false pseudo-recovery collapsed under the weight of its own structural failings, a recovery built on the combination of easy credit and handouts to the upper class was obviously not going to last long.
By this time, in 2007, when things started to fall apart, Bernanke had been appointed, and was proudly carrying on Greenspanâ€™s legacy of asking banks to loan to anyone with a pulse.
Bernankeâ€™s policies led to the economic tremors of the past couple years, as he himself admitted to Jim Lehrer, when he said, â€œItâ€™s true to some extent that this crisis was caused by too much credit, credit that was too risky, too easy. Thatâ€™s all true.â€ Well, weâ€™ve figured out that too much credit is a problem. So whatâ€™s Bernankeâ€™s plan for fixing the economy now?
In the same interview, Bernanke said, â€œif you have a small business and youâ€™ve tried to get a loan, you know that credit is very, very tight right now â€¦ The Federal Reserve has been working hard on this in a lot of ways.â€
Bernanke went on to explain how the Federal Reserve has cut interest rates to zero, is encouraging banks to lend more and has helped to finance new home and auto loans.
So, let me get this straight, mister Stanford professor and supposed economic uber-genius: Youâ€™re proposing that we fix the economic mess caused by â€œtoo much credit, credit that was too risky, too easy,â€ by, um, extending more credit? Are you the worst historian ever, or you deliberately sabotaging our economy?
Like the host who keeps offering more beer and pouring more shots after his guests are obviously wasted, Bernanke feels that he must keep dousing our economy with more credit. If you thought our economic party was ugly now, just wait until these new â€œstimulusâ€ shots pass through our system; there will be unconscious people strewn across the floor and vomit spewed all over the bathroom.
A large minority of the Senate realized the tragic error in reappointing this economic blowhard to one of the most powerful non-elected offices in America.
Sen. Bunning (R-KY) said that, â€œIf the Senate confirmed Mr. Bernanke, it would be like rewarding the captain of the Titanic for piloting the ship into an iceberg, not for getting everyone off safely.â€ Even if Mr. Bernanke is responsible for fixing the economy, which in due time weâ€™ll see he hasnâ€™t, he still shouldnâ€™t have wrecked the economy with cheap credit in the first place.
You know somethingâ€™s wrong when you see the following in the New York Times, which reported, â€œSenators from opposite ends of the spectrum formed unlikely alliances. After (Senator Bernie) Sanders (I-VT), who calls himself a socialist, finished denouncing Mr. Bernanke, Jeff Sessions, a conservative Republican from Alabama, rose to do the same.â€
Itâ€™s quite obvious that thinking people of all stripes reject the continuation of Bernankeâ€™s terrible economic rein. Itâ€™s a shame that the cowardly politicians of the mediocre middle were unwilling to offer Americans real change in this most important of areas.
It almost seems as if the Democrats want to get crushed in the upcoming 2010 elections. By reconfirming one of President Bushâ€™s worst appointees â€“ think Donald Rumsfeld bad â€“ the Democrats are showing their rhetoric of â€œhope and changeâ€ to be a bald-faced lie. Now, Obama will be standing on the deck of our Titanic when Captain Bernanke unflinchingly leads us into another iceberg.
Editorials Editor Ian Bezek is a senior economics major. His column appears Mondays in the Collegian. Letters and feedback can be sent to firstname.lastname@example.org_.