Keith, from my years in the Canadian public service, I know that lots of people
who are supposed to remain at a distance from each other talk to each other on
important matters. I would think that the Chair of the Fed and President talk
to each other and talk often especially in times of looming crisis like the
present. Declining dinner invitations and having talks on critical matters
behind closed doors are two different things.
Ed
----- Original Message -----
From: Keith Hudson
To: RE-DESIGNING WORK, INCOME DISTRIBUTION, , EDUCATION ; Ed Weick
Sent: Thursday, September 29, 2011 1:34 PM
Subject: Re: [Futurework] Bernanke speaking because Obama can't?
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: Keith Hudson
To: 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. Bernanke's 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 Fed's 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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