Bernanke's Renomination As Fed Chair

It doesn't seem very comforting to see Bernanke confirmed by the smallest margin the Senate has ever voted for this position, does it?

Especially when you consider that he's had the job for one term. I guess some Senators felt that changing Fed chairmen was risking someone even worse than Bernanke.

For a guy who seemed so experienced and well-qualified for the job, he sure made a hash of it when the going got tough.

To me, the salient criticism of Bernanke & Co. was conveyed in Anna Kagan Schwartz' interview in the Wall Street Journal in October, 2008. In that interview, she said this, which is in that linked post,

"But perhaps this is actually Mr. Bernanke's biggest problem. Today's crisis isn't a replay of the problem in the 1930s, but our central bankers have responded by using the tools they should have used then. They are fighting the last war. The result, she argues, has been failure. "I don't see that they've achieved what they should have been trying to achieve. So my verdict on this present Fed leadership is that they have not really done their job."

By that, which she specified elsewhere in the interview, she meant that liquidity wasn't the problem in 2008, but counterparty risk and solvency.

For this alone, I think Bernanke should have been denied another shot at mismanaging our money supply.

I suppose many feel better that even more uncertainty hasn't been injected into the financial system. But the price is to labor under a Fed chief who clearly does not have the confidence of most of Congress, has taken steps that are pretty clearly unconstitutional, including his role in the AIG and Merrill Lynch situations, and confused the nature of the single greatest challenge any Fed chairman has faced, with the probable exceptions of Volcker and Eccles.