Yglesias believes Perry’s harsh comments about the Fed chief show he believes monetary policy is quite effective

Matt Yglesias offers an interesting interpretation of Gov. Perry’s implied threats against Ben Bernanke. He argues that Perry’s comments show that he believes that monetary policy is very effective, and was warning Bernanke not to loosen the monetary reins for fear it would hand Obama the 2012 election:

. . . [T]he basic premise [of those who oppose monetary stimulus] is always that monetary easing will lead to some bad result. That’s most emphatically not what Perry said. What Perry said was that he was worried that Ben Bernanke would “play politics” by engaging in monetary easing before Election Day. Which doesn’t make much sense as a position unless Perry agrees with me that monetary easing would boost growth. If monetary easing hurt the economy, then it would hurt Obama. But Perry’s concern is that monetary easing would work well, and he was putting Bernanke on notice to avoid it because he wants to win the election. That’s a very different view.

While this is a neat angle, I don’t buy it. Bernanke is, first of all, an appointee of George W. Bush and a Republican. There’s no known basis for believing that, even assuming Bernanke would be inclined to take sides in the presidential election, he would prefer to see Obama reelected, rather than replaced by the candidate from his own party. Given the nature of Perry’s other positions and the audience of “red meat” Republicans he was speaking to, it’s much simpler to conclude that he was just playing up to the Tea Partier concern that “printing money” to finance government spending is a great evil to be stopped. And that fits the explanation the Perry campaign gave to the New York Times on Tuesday:

“[Gov. Perry] is passionate about getting federal finances under control,” the spokesman, Ray Sullivan, said in an interview here. “They shouldn’t print more money. They should cut spending and move much more rapidly to a balanced budget.”


About Guy N. Texas

Guy N. Texas is the pen name of a lawyer living in Dallas, who is now a liberal. He was once conservative, but this word has so morphed in meaning that he can no longer call himself that in good conscience. Guy has no political aspirations. He speaks only for himself.
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