The White House said yesterday it has damped down a political revolt against Ben Bernanke and now has the votes to secure the Federal Reserve Chairman’s second four-year term. Whether or not Mr. Bernanke is confirmed, the lesson we draw is that overly political central bankers will eventually be undone by politics.
There’s no doubt that some of this reconfirmation panic is nothing but political opportunism. When we opposed Mr. Bernanke’s reconfirmation on December 3, the facile consensus was that the Fed chief was a master of the universe who had saved the world from depression. But after Scott Brown’s victory in Massachusetts last week, Senate Democrats are suddenly looking for a financial political sacrifice. President Obama doesn’t look ready to throw over Treasury Secretary Tim Geithner, so Mr. Bernanke is the designated spear catcher.
The Democrats’ loudest complaint, moreover, is that Mr. Bernanke and the Fed haven’t been easy enough in printing money. Majority Leader Harry Reid declared his support for Mr. Bernanke on Friday, but not before extracting what he said were concessions about future Fed policy.
The Fed chief promised, said Mr. Reid, that he would “redouble his efforts” to make credit available and that Mr. Bernanke “has assured me that he will soon outline plans for making that happen, and I eagerly await them.”