Ed,
I doubt whether Bernanke discussed this with
Obama -- at least directly. Chairmen of the Fed
have valued their (so-called) independence.
Greenspan would see Bush from time to time but
maintains that he never discussed Fed matters
with him. His predecessor Paul Volcker (or
perhaps the one before him) went so far as to
decline dinner invitations from the President
(that is, he turned down the first invitation and
didn't get another one after that!).
I would still maintain that Bernanke is feeling
panicky. So far, he's just been pushing on a
piece of string. We still don't know just why the
Fed committee met for two days. What came out of
it didn't seem to justify it. They could, of
course, have decided on other things which we don't know about.
Keith
At 17:13 29/09/2011, you wrote:
Keith, I tend to go along with Arthur on this one.
Because politicians can't help being what they
are, more of this kind of thing needs to be said
by authoritative people who are not politicians.
If Obama were to say what Bernanke, he would be
accused of making an ideologically based
political statement. The Republicans would find
ways to tear it to shreds. If Bernanke is
saying it, however, it is coming from a highly
respected economist (no matter what you think of
him) with no political axe to grind
(supposedly). It's a straight-out warning, and
it's certain that he would have discussed the
statement with Obama before he made it.
Ed
----- Original Message -----
From: <mailto:[email protected]>Keith Hudson
To:
<mailto:[email protected]>RE-DESIGNING
WORK, INCOME DISTRIBUTION,EDUCATION
Sent: Thursday, September 29, 2011 11:00 AM
Subject: Re: [Futurework] Bernanke speaking because Obama can't?
Ed,
Having failed to produce more employment by his
Keynesian money-printing methods, Bernanke is
now trying to throw the blame onto Congress! The
irony is that, in fact, members of Congress have
already brought about a great deal of extra
employment over the years when getting funds for
pork barrel projects in their own
constituencies. These have usually been
successfully achieved by tucking them
inconspicuously into larger pieces of
legislation. These projects, too, have been
adding to government deficits every year, just as Bernanke has.
It's also nonsense for Bernanke to suggest that
lessons could be learned from the emerging
nations, and particularly China. True, their
governmental budgets are often far more
disciplined than ours but that's mainly due to
centuries' old cultures which means that their
people, to a very considerable extent, will do
as they're told. China, for example, doesn't
have anything like a welfare state or social
security (worth speaking of) either. This means
that ordinary people save as much as 30% or 40%
of their earning against their old age or for
health reasons. If Americans were to go anywhere
near that level of savings then it would kill
even the present depressed economy stone dead.
Bernanke is becoming panicky -- as well he
might. Also, I suspect, he's trying to distance
himself from Obama who, probably, won't get re-elected in 2012.
Keith
At 14:30 29/09/2011, you wrote:
From today's Globe and Mail.
Ed
Long-term unemployment in U.S. a national crisis, Bernanke says
MARTIN CRUTSINGER
WASHINGTON The Associated Press
Last updated Wednesday, Sep. 28, 2011 9:37PM EDT
In unusually strong language directed at U.S.
politicians, Federal Reserve Chairman Ben
Bernanke has called long-term unemployment a
national crisis and suggested Congress needs
to act on jobs and the housing industry.
Mr. Bernanke noted that about 45 per cent of
the unemployed have been out of work for at least six months.
This has never happened in the post-war period
in the United States. They are losing the
skills they had, they are losing their
connections, their attachment to the labour force.
He added: The unemployment situation we have,
the job situation, is really a national crisis.
Mr. Bernanke said the government needs to
provide support to help the long-term
unemployed retrain for jobs and find work. And
he suggested that Congress should take more responsibility.
Responding to a question, Mr. Bernanke said
long-term unemployment, budgetary discipline
and housing policy were the three most
important areas where Congress could contribute to an economic recovery.
There are certainly some areas where other
policy makers could contribute, he said.
Mr. Bernankes comments were his latest in a
public effort to get Congress to act further to
rejuvenate the economy. He suggested that the
Fed can achieve only so much through policies
that seek to lower long-term interest rates.
The Federal Reserve has made enormous efforts
to try to help this economy recover and
stabilize through its control of interest
rates, or monetary policy, he said. Those
policies have driven rates to record lows.
Monetary policy can do a lot, but monetary
policy is not a panacea, Mr. Bernanke said.
On the housing crisis, he said strong
government programs to help the industry
recover would aid the Feds own efforts to
boost housing by driving mortgage rates to their lowest levels in decades.
In his speech, the central banker said the
United States and other rich nations could
relearn a few lessons from fast-growing developing nations.
He said the successful emerging economies such
as China had adopted disciplined budget
policies, embraced free trade, made public investments and supported education.
Advanced economies like the United States
would do well to relearn some of the lessons
from the experiences of the emerging market
economies, such as the importance of
disciplined fiscal policies, Mr. Bernanke said.
But in the question-and-answer period, Mr.
Bernanke cautioned U.S. lawmakers against
cutting deficits too quickly to reduce budget
deficits. He has said that could put the fragile economy at risk.
He noted in his speech that emerging markets
such as China account for a large and growing
share of the global economy, so they need to act accordingly.
With increasing size and influence comes greater responsibility, he said.
Emerging nations will be challenged in the
future by their reliance on exports to drive growth, he added.
The Obama administration has been pushing the
Group of 20 major economies, which includes
traditional powers such as the United States
and emerging economies such as China, Brazil
and India, to boost domestic demand rather than
relying so heavily on exports to rich nations.
Keith Hudson, Saltford, England http://allisstatus.wordpress.com/2011/09/
----------
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Keith Hudson, Saltford, England http://allisstatus.wordpress.com/2011/09/
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