Politics

Ben Bernanke and a Protest Vote

The Senate's No 2 Dem, Dick Durbin of Illinois, spent about 30mins with Ben Bernanke Monday afternoon, as the Fed Chairman’s re-nomination to a 2nd term is still a bit of a question mark in the Senate, and emerged to say while he is still unsure of the vote count, with Republicans crucial to any victory, he feels “this nomination will get through.”

With strong words of support, though ever aware of the precarious nature of voter anger about the state of the economy, Durbin declared, “I’m going to support Chairman Bernanke’s nomination to be chairman, re-nominated to be chairman, of the Federal Reserve. I have been concerned about some of the past decisions that have been made, but there is one thing I know for certain. During the darkest days of this economic recession, when this country was teetering on a Depression, this man and his leadership at the Federal Reserve made a difference.”

But Bernanke said the magic word that many Democrats want to hear, an acknowledgment that “mistakes were made.” Bernanke said, as a member of the Fed, that body “didn’t see (the housing bubble) coming.”

 

But, Durbin said, “Putting this all on his doorstep may be going too far.”

 

Durbin actually went into the weekend undecided about Bernanke, but he says he asked himself, "Durbin (yes - he seems to call himself "Durbin"), is this a protest vote? Is that what it’s all about? And if that’s so, is it sensible? Is it the right thing for us?” Durbin said he decided he didn’t “think it’s the right thing to do.”

 

But he was quick to say that was his own, personal decision, as many Democrats are running scared from the populist rage that exploded in Massachusetts, sweeping a Republican into office.

It’s an awfully attractive prospect to whip this former Bush nominee in protest of big bailouts, of Wall Street, against massive job losses.

 

Durbin has now been pulled into help with the full-court press sales job that includes the President making personal calls to members and Bernanke taking one-on-one meetings.

 

Other members, including Senate Banking Cmte Chairman Chris Dodd, D-CT, are pushing colleagues, along with Sen. Judd Gregg, R-NH, the top Republican on the Budget Cmte and strong support of the early Wall Street bailouts.

 

Durbin’s sales pitch to his colleagues, a tough one in the face of the Massachusetts upset: “Be acutely aware that what we saw in Massachusetts is being felt across the country. People expect us to move on the economy and the issue of unemployment as quickly as we can, but this is not your only opportunity. A protest vote, or negative vote, on Chairman Bernanke isn’t your only opportunity to show people that you care. We are going to have a chance to have a jobs bill. We are going to have financial regulatory reform…Members are going to have ample opportunity in the months to come to speak out in a very forceful way about moving this economy forward.”

 

There are, by internal Fox counts, about 15-16 Democrats still undecided, with a couple leaning toward supporting the nomination. Durbin, by this count, will even have to try to convince some members of leadership. Sen. Patty Murray, D-WA, number four in the lineup, remains undecided, according to her office. Sen. Claire McCaskill, R-MO, a close ally of President Obama, also counts herself in that category.

 

In an interview with Fox News Radio’s Mike Majchrowitz, Sen. Dianne Feinstein, D-CA, who received a visit by Bernanke recently for more than an hour, said, “I think for reasons of stability and continuity it is important to have sustained senior leadership that is respected, and he is very much so…I just don’t believe this is the time for a change so I am very pleased to support him.” But, Feinstein noted, “If it weren’t Bernanke, who would it be?”

 

Still Durbin said he feels Bernanke is “the best person for the job,” not just the only guy who could fill the job description. The very fact that Bernanke went through the recession, from which some say this country is now emerging or has emerged, as proof-positive that he knows how to steer the U.S. economy straight, according to Durbin.

 

On the meltdown at AIG, something that causes great angst among with Dems and Republicans, Durbin said Bernanke told him a thorough investigation will occur at the hands of an independent watchdog, the GAO, but “(Bernanke) draws the line” at legislation by Sen. Bernie Sanders, I-VT, who wants to see GAO look into the policy-making of the Fed. Bernanke, Durbin said, feels that goes too far toward violating the independence of the fed.

 

Sanders has led the charge against Bernanke and has pushed his colleagues to follow suit.

 

One issue close to Durbin, the creation of a new watchdog agency, the Consumer Financial Protection Agency (CFPA), yielded what must have been a good answer to Durbin from Bernanke. The chairman, according to Durbin, said that though the Fed has about 200 people working on consumer protection, he is “open to whatever Congress decides.”

 

Bernanke’s tenure as chairman expires on Sunday. Aides to Reid say a vote is expected before week’s end; although, if the Majority Leader does not file cloture on the nomination by the end of Monday, which one senior Senate Dem leadership aide said was “not likely,” the vote will not occur by Wednesday night’s State of the Union address.