Everyone Likes Ben Bernanke Now That He's Leaving
Ben Bernanke has never been as appreciated as he's been this month, now that he's leaving. Both liberals and conservatives, who have questioned the Bush-elected chairman's handling of the recession, are predicting that this legacy will be a good one.
Ben Bernanke has never been as appreciated as he's been this month, now that he's leaving the Federal Reserve on Wednesday. Both liberals and conservatives, who have questioned the Bush-nominated chairman's handling of the financial crisis and the recession, are predicting that this legacy will be a good one. "In spite of the difficult start he faced, the signs are beginning to point to history looking kindly on Ben Bernanke as America's central banker," wrote The Week. A Wall Street Journal commentary noted that Bernanke succeeded despite expectations:
Many professional investors are acknowledging, sometimes grudgingly, that Mr. Bernanke has gone a long way toward achieving the main goal he set in 2008: He has stabilized markets and restored a large measure of investor and public confidence. Many thought it impossible that he would accomplish what he did.
Even Fox Business wondered whether he was Hall of Fame-worthy earlier this month, arguing that "Bernanke’s response to the worst crisis since the Great Depression was aggressive, controversial and, much to the surprise of his critics, largely successful."
Bernanke circa 2008 might be surprised to see all that begrudging praise, especially from right-leaning outlets. Over the years conservatives have trashed his policies for not respecting conservative principles and accused him counterfeiting and treason. In honor of his last week as Fed chair, here's a look back at the people who've hated him the most over the years.
A FoxNews.com op-ed last July by Peter Morici argued that Bernanke's policies will lead to socialism and massive inflation:
The Fed’s printing press is propping up an already anemic economy. [...] The economy will collapse again and then what will the Fed do? The only thing it has left—enable more federal stimulus by printing even more money. Hyper inflation and unemployment above 15 percent could easily follow.
America, welcome to the Weimar Republic—Germany in the 1920s!
Mitt Romney wasn't as nasty towards Bernanke as others, but if he'd won the election he would have replaced him. Sarah Palin, in 2010, told Bernanke to "cease and desist" the Fed's purchases of government securities, because it would lead to runaway inflation:
We shouldn’t be playing around with inflation. It’s not for nothing Reagan called it “as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man.” The Fed’s pump priming addiction has got our small businesses running scared, and our allies worried. The German finance minister called the Fed’s proposals “clueless.” When Germany, a country that knows a thing or two about the dangers of inflation, warns us to think again, maybe it’s time for Chairman Bernanke to cease and desist.
As it turned out, Bernanke's practices worked, despite the warnings of Germany's finance minister, and Sarah Palin's.
Paul Ryan had a few grim predictions about Bernanke's economic policies during a 2012 hearing with the House Budget Committee, which Ryan chairs. According to The New York Times, in reaction to news that the Fed planned to keep short term interest rates near zero, said "I think this policy runs the great risk of fueling asset bubbles, destabilizing prices and eventually eroding the value of the dollar.”
Liberals have also been critical of Bernanke, though to a lesser extent and for different reasons. Following a Bernanke profile published in The Atlantic in March 2012, Matt Yglesias at Slate wrote that Bernanke was going against his own advice by not allowing for higher inflation, or taking more risks:
The academic who once said that “FDR deserves great credit for having the courage to abandon failed paradigms” is too sober to abandon an inflation target that’s generated mass unemployment. The central banker has tools at his disposal that might get the American labor market out of the ditch, but he’s unwilling to try them because they might not work.
Yglesias argued that Bernanke's defenses of his practices only "confirm[ed] his liberal critics’ worst fears."
Steve Forbes called Bernanke's term an "epic failure." In an October 2013 story for Newsmax, he argued that "Bernanke believes printing money creates prosperity," but he "didn't understand what central banking was. He didn't understand money. He didn't understand the Great Depression."
Ron Paul's arguments with Bernanke during the House Financial Services Committee hearings were probably some of the more exciting moments of CSPAN over the years. In one of the more famous showdowns, Paul asked Bernanke if gold is money. Bernanke replied that, no, it's not, which Paul disagreed with. Skip to the 4:37 mark:
Back in 2009, when Time named Bernanke person of the year, Paul said he deserved the honor, because he's "the greatest counterfeiter in the history of the world."
Rick Perry, back in 2011 when he was a Republican nominee frontrunner, Perry more or less threatened Bernanke during a speech in Iowa:
If this guy prints more money between now and the election, I dunno what y’all would do to him in Iowa but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treasonous in my opinion.
Rand Paul and the "Audit the Fed" movement. "Audit the Fed," Rand Paul's 2013 effort to increase the transparency of the Fed, led to Janet Yellen's nomination being held up, but it was also the natural progression of conservative displeasure with Bernanke's policies. Twenty-eight conservatives (and one Democrat) co-signed the Audit the Fed bill, aka the Federal Reserve Transparency Act, including a who's who of the Tea Party elite. The bill sought to give Congress more oversight power over the Federal Reserve, but as The Washington Post noted "Instead of a 'transparency act,' Paul’s bill will probably be a 'harassment act' in practice."