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Who Should Run the Fed?
If you weren't convinced before that Ben Bernanke should be replaced as Chairman of the Federal Reserve you might be now. Wall Street's Humble Servant--Secretary Timothy Geithner--has warned that if Bernanke is replaced, "I think the markets would view that as a very troubling thing to the economy as a whole."
Geithner and Bernanke's subservience to "the markets" at the expense of the public interest is key to why there is growing opposition to Bernanke serving a second term. His Senate reconfirmation vote was already delayed once, and according to The Hill, "no less than 13 Democratic and Republican senators" have now announced that they will vote against him----including Senators Bernie Sanders, Russ Feingold, Byron Dorgan, Barbara Boxer, and Jeff Merkley. Many more are on the fence.
No one has been more vocal in his opposition than Senator Sanders who placed a hold on Bernanke's nomination. In a statement released on Sunday, he said: "The issue for Democrats is whether they will allow Republicans to pretend to be the populist, anti-Wall Street party, or whether they will have the courage to stand up to Wall Street and bring in a Fed chairman who will represent the needs of working families rather than huge financial institutions… Ben Bernanke was the top economic advisor to George W. Bush. He was in lockstep agreement with Alan Greenspan, who has now endorsed him. These are the people who let Wall Street run amok."
I also spoke with University of Maryland Law Professor Michael Greenberger for his take on Bernanke. Greenberger served as the Director of the Division of Trading and Markets at the Commodity Futures Trading Commission (CFTC) back when Chair Brooksley Born and her colleagues were calling for regulation of derivatives.
"Bernanke is constantly playing shell games," Greenberger said. "Now he's trying to get out of the criticism for having too lax a monetary policy by saying, ‘It wasn't monetary policy it was lax regulation.' But Bernanke was vigorously fighting regulation of hedge funds, for over-the-counter derivatives, up to the point of the meltdown. And, in fact, one of the biggest sponsors of this current swap exemption is the Fed--it's a $50 trillion exemption. So when he's attacked for monetary policy he says, ‘Oh, it's regulation. But he led the charge for deregulation and fighting re-regulation."
It's absurd to think that there aren't plenty of other highly qualified candidates who could run the Fed. It's equally absurd to think we shouldn't hire any of them because of temperamental markets. Worship of "the markets" is what got us in this mess to begin with.
Below are some of the names being floated by various Democratic, progressive and labor sources--in no particular order. They are an impressive group--worth passing along to your Senators with a message that Bernanke simply isn't the right person for the job in these times.
Elizabeth Warren: Harvard law professor, chair of the Bank Bailout oversight panel. A Consumer Financial Protection Agency to protect consumers against predatory lenders and other toxic financial products was her idea.
Paul Volker: Chairman of the Federal Reserve under Carter and Reagan from 1979-1987. Chairman of Obama's Economic Recovery Advisory Board. Has been Chair fighting to regulate the scale and scope of TBTF financial firms while Geithner, Summers, and Bernanke have taken a passive approach.
Brooksley Born: Chair of the Commodity Futures Trading Commission under Clinton. Fought for regulation of derivatives but was ignored, setting stage for the economic meltdown. Born is currently a member of the Financial Crisis Inquiry Commission.
Joseph Stiglitz: Chairman of President Clinton's Council of Economic Advisers from 1995-1997, former Chief Economist of the World Bank, 2001 recipient of the Nobel Prize in Economics.
Nouriel Roubini: professor of economics at the Stern School of Business, New York University and chairman of Roubini Global Economics. In September 2006 he warned the IMF: "The United States was likely to face a once-in-a-lifetime housing bust, an oil shock, sharply declining consumer confidence, and, ultimately, a deep recession." He also foresaw "homeowners defaulting on mortgages, trillions of dollars of mortgage-backed securities unraveling worldwide and the global financial system shuddering to a halt." Recently named one of the 100 most influential people in the world by Time magazine.
Warren Buffett: in March of 2003, Buffett called derivatives "financial weapons of mass destruction" that could pose "a mega-catastrophic" risk to the economy.
Simon Johnson: former chief economist of the International Monetary Fund and currently an economics professor at MIT. Writes the invaluable Baseline Scenario.
Robert Reich: served as Clinton's Secretary of Labor. Currently Professor of Public Policy at the University of California, Berkeley.
Jared Bernstein: Chief Economist and Economic Policy Adviser for Vice President Biden. Worked as senior economist for the Economic Policy Institute.
William Black: an Associate Professor of Economics and Law at the University of Missouri–Kansas City. Black was the litigation director for the Federal Home Loan Banks during the Savings and Loan crisis. He served as Senior Deputy Chief Counsel, Office of Thrift Supervision.
Nomi Prins: Senior Fellow at Demos and author of It Takes a Pillage: Behind the Bonuses, Bailouts, and Backroom Deals from Washington to Wall Street. Former managing director at Goldman Sachs and Bear Stearns.
Paul Krugman: the New York Times columnist is a Professor of Economics at Princeton University and a Centenary Professor at the London School of Economics. In 2008, he won the Nobel Prize in Economics.
Dean Baker: co-Director of the Center for Economic and Policy Research. He worked as a senior economist at the Economic Policy Institute. He has also worked as a consultant for the World Bank, and for the Joint Economic Committee of the U.S. Congress.
Lawrence Mishel: President of the Economic Policy Institute.
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23 Comments so far
Show Allhow far we've fallen when paul volker is considered to be a "liberal"
how about ravi batra?
The first course of action is to contact your two US Senators via phone or e-mail and tell them to vote AGAINST (always capitalized when you write to electeds) reconfirming Ben Bernanke.
Sioux Rose
Our nation hardly lacks intelligence or resourcefulness. It's the matter of that small group of powerful persons who keep those that would prove a blessing to the state of the nation outside the corridors of direct power. Their influence is felt at the margins... but the benefits they could bring are needed at the center. Will Obama appease the angry masses by letting a few of these potential heroes into the inner circle? All bets are now officially on...
Every time I turned the radio on during the past three days I heard Obama or one of his gunners zealously supporting the reconfirmation of Bernanke and chastising Senators who might consider voting against him.
The name is spelled "Volcker".
And yes, it's mind-boggling that Volcker is being rehabilitated as a Good Guy.
It's like suggesting that Hillary Clinton be replaced by Henry Kissinger.
· Yr Obd't Servant
A Kissinger re-emergence is not as far fetched as you may think. I heard that Tim Geithner's first job out of college was working for Kissinger.
Let's see, last fall, Congress hesitates to give Bernanke $700 billion, the markets tank. Now, some question about his being re-appointed, and guess what, the markets tank. Do you see a pattern. To me, this is another reason to replace him. The idea that only one person can handle this job is absurd.
Bernake, Geithner & Summers all need to be tanked. They do a great disservice to the American people.
IMO, you can scratch Dean Baker from the list of possible replacements. His articles posted here are the basis of my opinion.
I propose Naomi Klein and Noam Chomsky.
Just to let a different group - the left wing - take charge of the political economy of the United States and the world.
Too bad Naomi is Canadian.
Nomi Prins is my first choice.
There are hundreds of people as corrupt as Bernanke, as willing to follow the bidding of the corporate state. You'd think that Obama, in typically cynical style, would jettison the bald and bearded one for some interchangeable corrupt and sinister figure and then claim he was "listening to the people". But he won't even do that. That's how hopelessly far gone the United States is.
The REAL Answer is You DO NOT Replace Bernanke With ANYONE!
The Solution to the Problem is END The FED!
The Federal Reserve (all Central Banks for that matter) Are Illegal and Anti-Constitutional.
Article I Section 8 of the United States Constitution CLEARLY Says ...
Congress shall have the Power to Coin Money, regulate the Value thereof ...
... To Provide for the PUNISHMENT of Counterfeiting (thats what the FED is doing, counterfeiting money, illegal, non-constitutional paper debt money)
So, if we still live in a Constitutional Republic, here in the United States, which is where I rather live than in this centralized power Tyranny of Corporatism, aka Fascist State, that we have been living under and continue to these days (it's a velvet form of Fascism, but it is none the less)
We do NOT Replace Ben Bernanke, We Fire Him and the Rest of the Bankster Criminals at the Federal Reserve - and we return to a non-debt based form of currency, as offered up in our constitution - This will curb spending on WAR and OCCUPATION - aren't we all here against WAR and OCCUPATION? This is the ONLY Way to end these things. Hoping for a loving and peaceful Obomber to end the WARS and OCCUPATION is never going to happen.
END The FED
I would be happy just to see the damn thing audited. Of course..that would be the beginning of the end for the illegal operation known as the Fed.
Exactly.
Sorry, Greg. But what Timmy wants Timmy gets with this President. And all you need to know about what Timmy wants is what Goldman Sachs wants. Oh, did I leave out Larry Summers, another Goldman Sachs alumni? You know, the guy who thinks women can't do math?
Actually, Obama's administration looks and acts more Republican than "bipartisan". And instead of Bush and his Iraq war, we have Obama and wars on THREE fronts, with two more heating up. What's next on his agenda? Oh that's right. I hear he's muttering about balancing the budget on the backs of the poor and elderly. I know, in the aftermath of the Massachusetts massacre when blaming Bush didn't work now he's talking about goodies for the middle class. What we've learned about him is talk is cheap. A friend of my mother had a saying on a hot plate: "Kissin' don't last - Cookin' do!" Obama wouldn't even lift a finger to help get Cramdown through Congress last year. We had almost 4 million foreclosures last year and even more expected for this year. Any ideas on that, Obama? We're talking about families landing out on the streets, millions of them. Makes me think of Reagan ignoring HIV and Bush ignoring Katrina.
When the people fear their government there is tyranny,
when the government fears the people there is liberty.
~ Thomas Jefferson
Abolish the Fed and restore the Bank of the United States. The GOP should have no problem with that because their political ancestors, the Federalists, were formed around the cause of this regular retail bank operating out of the Treasury Deapartment. If the bank were re-opened, retail customers would leave their private banks for the better services, lower rates, and better security of the bank of the US government. Moreover, the revenue generated by the bank could lower taxes on its retail customers, i.e. wage earners.
The solution is not who should run the fed, its why do we have the fed, what do they do, and do they benefit the people. I happen to think it should be abolished.
I suggest this documentary. It's short and on youtube: http://www.youtube.com/watch?v=vVkFb26u9g8
Required Reading List;
The Creature from Jekyll Island by G.E. Griffin
The Case Against the FED by Murray Rothbard
END The FED by Ron Paul
We'll leave it here for now. Read these and I am sure you will search out more.
Oh and maybe everyone should start by reading the United States Constitution first, then move on to these books.
END The FED!
This is a pretty piss poor article.
He throws a bunch of names against the wall, provides an extremely basic and generic view of them, and leaves it at that.
He doesn't provide any basic review of what the economic views of these people are. Or even use simplistis terms, such as Keynesian, monetarist, Chicago school, etc.
Volcker or Buffet would very likely have different views on economic policy than say, Stiglitz, or Baker, or Krugman.
It interesting to note the "The Bank of Canada" is totally owned by the Government. There was a time when it was the sole source of new Currency wherein when money was needed to fund a program, The bank Of Canada would print it up. This funded our Health Care system without issue for the first 20 years.
Then Nixon took the US dollar off the Gold Standard. This lead to worldwide inflation. What is important is that "Economists" in Canada who were friendly to the banks insisted that the inflation was due to the Bank of Canada printing Currency and that in order to get a grip on it, Canada should instead BORROW money from Investors rather then print as needed. The creation of Currency then shifted to the Private Banks via a debt based system.
Has anyone else here heard
any of the following rumors:
1. That the Federal Reserve is
the central bank of the U.S.
set up by the Rothschild
banksters to serve their own
personal interests?
2. That the Rothschild banksters
now own similar central banks
in every country in the world
except for five (for instance,
not in Iran, or in Cuba)?
3. That the New York Federal
Reserve Bank is the "head of
the octopus" -- that is, the
controlling branch of all the
other Federal Reserve banks?
4. That Timothy Geithner was the
head of the New York Federal
Reserve before becoming U.S.
Secretary of the Treasury --
and therefore could be seen
as the "capo" of the Rothschilds?
5. That Bernanke is current head of
the Federal Reserve because he is
yet another high-placed tool and
servant of the Rothschild bankster
family?
6. That Obama -- like every "President"
of the United States for the past
century or so -- became "President"
only because he was suitable to the
Rothschilds, and serves only so long
as he serves their interests?
7. That Geithner -- the "capo" for the
Rothschilds -- is actually MANAGING
"President" Obama, and making sure that
every single thing Obama does serves
the interests of the Rothschilds?
Just wondering.
Like I mentioned below, read the Creature from Jeckyll Island, by G.E. Griffin for a comprehensive history on the beginning of the Federal Reserve and United States Central Banks in general. Be advised though, it is a hefty book, almost 600 pages. But it breaks down the entire banking history in great detail. And at the end of the book offers solutions on how to move past the federal reserve cartel and ultimately saving our country from total financial breakdown.
You will get the answer to most of your questions in this book.
Also, read a Case Against the FED by Murray Rothbard and, Ron Paul's END The FED.
Send Diogenes to search for a new chairman.