Federal Reserve Reserved

The lead story in today’s New York Times is titled, “Fed Chief Wins a Second Term Despite Critics.” The vote was the weakest in history for the Chairman of the Federal Reserve, 70-30.

Ben Bernanke is simultaneously viewed as the architect and savior of today’s economy. His lax policy positions caused it, and many view his rapid bailouts as saving it.  According to the article, Senator Jeff Merkley of Oregon made one of the most strident remarks, accusing Bernanke of helping to “set the fire that destroyed our economy.”

The attacks on Bernanke, in my opinion, represent a desparate attempt to find a scapegoat. It’s easier to blame the Fed than your own institution. In reality, virtually noone anticipated the bursting of the housing or credit card market bubbles.

The attacks by Senators at the confirmation hearings were mainly meant for the general public who are outraged at the enormous bonuses still being awarded at major banks. This is an election year, and after the upset by Scott Brown, no incumbent feels very much at ease about their own chances.

The alliance of nay voters included some very unusual coalitions including, for example, the only Socialist, Vermont Senator, Barry Sanders, and the Republican conservative, Jeff Sessions of Alabama.

One can only hope the renomination will become less and less important as Happy Days Come Here Again.