Fed Chief Bernanke to GOP legislators: stop sabotaging the economy

Kevin  Drum (via Professor DeLong):

Bernanke to GOP: Stop Sabotaging the Economy: From Ben Bernanke, in testimony before Congress today:

 The recovery is close to faltering.

It’s good to see that someone is noticing. In Bernanke’s prepared remarks, after noting tight credit, slow consumer spending, financial stress in Europe, and other problems likely to hurt the economy, he got to this:

Another factor likely to weigh on the U.S. recovery is the increasing drag being exerted by the government sector. Notably, state and local governments continue to tighten their belts by cutting spending and employment in the face of ongoing budgetary pressures, while the future course of federal fiscal policies remains quite uncertain….In setting tax and spending policies for now and the future, policymakers should consider at least four key objectives. One crucial objective is to achieve long-run fiscal sustainability….A second important objective is to avoid fiscal actions that could impede the ongoing economic recovery.

This isn’t really new. But every time Bernanke says it, he edges slightly closer to calling GOP members of Congress idiots for obsessing about short-term austerity and spending cuts when they should be obsessing over how fast they can shovel money out the door. What’s more, he’s being as clear as he can that if Congress does this, the Fed’s monetary policy won’t get in the way. But poor old conservative Ben Bernanke is now, in the view of most current Republicans, a dangerous radical lefty hellbent on debasing the currency and getting his Kenyan pal in the White House reelected. I wonder if he ever sees any humor in this?

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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.
This entry was posted in Business, Economic policy, Economics, News, Politics. Bookmark the permalink.

One Response to Fed Chief Bernanke to GOP legislators: stop sabotaging the economy

  1. Owner says:

    Hello,

    Randomly stumbled upon your blog – interesting post.

    I find it ironic that Bernanke is calling for “long run fiscal sustainability” while, at the same moment, advocating a fiat currency based on the Federal Reserve’s conception of economic needs. Long run sustainability is undermined by the inflation and deflation of currency at will. The boom-bust business cycle is perpetuated by the Federal Reserve and their arbitrary tinkering with the value of the dollar. Without the attachment of currency to a commodity (e.g. gold), the currency is subject to the whims of a few individuals, whom we assume are noble and righteous. Lastly, the Federal Reserve is an autonomous body with no oversight from Congress/the Executive and thus no hand of the people. In addition, they control the most pervasive means of theft: inflation through the printing of money. At will, the Fed can print more money to finance any program it’s “noble, righteous” leaders see fit, thereby decreasing the value of the money in our wallets and in our bank accounts. There is no bank, no safe, and no investment can protect against this. A hole in the backyard cannot even protect against this type of theft. It hits the poor the hardest, as they are most unable to hedge inflation through investments. They have the least access to this information and are the least aware and, as a result, benefit the least.

    You might be interested in my blog, http://thesameair.com

    I will be discussing “End the Fed” by Ron Paul soon. Good post.

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