Over the past few weeks, the media had become very interested in the prospect that Ben Bernanke might not be reconfirmed as the chairman of the Federal Reserve. I had maintained, however, that this was sensationalist "imagine if" journalism. I never bought into the idea that his nomination was in serious jeopardy; and indeed, it passed easily 70 to 30, though it was closer than the vote is historically for the nation's top central banker. And who made sure that Bernanke got another term? Republicans.
If you dissect the vote, you find something very interesting: had the Republicans chosen to do so, they could have killed the nomination. The numbers come out 48 Democrat ayes, 22 Republican ayes, 12 Democrat nays, 18 Republican nays. Democrats alone did not constitute a majority of ayes. Thus, if those 22 Republicans had voted nay instead of aye, we'd be looking for a new Fed chair right now.
So sensationalists weren't completely wrong to predict problems for the confirmation: they were right that quite a few Democrats -- 12 -- would ultimately rebel against President Obama's nomination. And that is a little surprising, given that their party's leader, President Obama, nominated him for a second term. But those who worried about the nomination were wrong to think that Republicans would band together to fight an Obama nomination. If they had, they would have succeeded in kicking Bernanke out, thanks to those 12 Democrat nays.
I predicted this result all along. Back in December, I wrote:
How about Republicans? They might love to stick one to Obama, right? Not under this circumstance. If they reject Bernanke, then Obama gets to pick someone new. Remember President George W. Bush appointed Bernanke, who identifies himself as a Republican. Do Republicans really believe they'll be happier with a different Obama pick than Bernanke? If they do, then they're kidding themselves. Deep down, they must believe they would be a lot better off with Bernanke than any alternative the President might suggest.
When push came to shove, the prospect of a more liberal, partisan Fed chair with a strict allegiance to the Obama administration must have outweighed the imagined joy of embarrassing the President. Or we can be less cynical and believe that politics had less to do with it, but that those 22 Republicans actually thought Bernanke was the best man for the job. Whatever their reasons for standing behind Bernanke, I'm sure the market breathed a sigh of relief, and the economy will ultimately be better off.