Washington state’s senators split today on the reappointment of Ben Bernanke to the Federal Reserve Bank chairmanship. Patty Murray voted for, despite reservations, and Maria Cantwell voted against. The 70-30 vote was the closest ever for confirmation for a Fed chairman.
Cantwell: “This is not one Fed chairman’s problem or one administration’s problem … My vote against the Fed chairman has to do not with the past but with the future – the future prevention of another bubble, or more bankruptcies.”
Murray: “The concern across our state and nation about the pace of our recovery is understandable. I share that concern. I have shared it with Ben Bernanke directly. I told him I expect accountability and transparency from the Fed and a commitment to put the needs of American consumers ahead of Wall Street banks.
Below are full press releases from both Democrats.
Cantwell Opposes Bernanke Reappointment
Says Fed Chair Failed to Focus on Urgent Need to Get Credit Flowing to Community Banks, Small Businesses
WASHINGTON, DC – Today Senator Maria Cantwell (D-WA) voted against the reappointment of Ben Bernanke to a second four-year term as chairman of the Federal Reserve Bank. Cantwell’s primary concern is creating jobs by getting capital flowing again to Main Street businesses through community banks. Mr. Bernanke was confirmed in a 70-30 vote. Cantwell said the Fed and Department of Treasury need to aggressively move capital to community banks for small business loans. Urgent action is needed to prevent the next crisis that is bubbling up on Main Street.
“This is not one Fed chairman’s problem or one administration’s problem,” Senator Cantwell said in a Senate floor speech. “My vote against the Fed chairman has to do not with the past but with the future – the future prevention of another bubble, or more bankruptcies.”
The Fed chairman and Treasury should lead the charge for real regulatory reform, without loopholes, Cantwell said. Without their leadership, it will be nearly impossible to change Wall Street dark market activity. Cantwell and Senator John McCain (R-AZ) introduced the Cantwell-McCain Banking Integrity Act, to separate commercial and investment banking, as was done under the Glass-Steagall Act that stabilized the nation’s financial system for decades following the Great Depression.
Cantwell urged the Obama administration to immediately use funds from the Troubled Asset Relief Program (TARP) to infuse capital into small community banks for small business lending. The plan, announced by President Obama in his State of the Union Address, can be done by executive action rather than time-consuming legislation. Community banks should receive $50 billion in TARP funds, not the $30 billion in the White House proposal, she said. Funds should be accessible to small banks that need the infusion to spark local lending. And the program should include incentives to ensure that lending capital directed to community banks actually flows to small business.
“I don’t want to leave the American people with the thought that somehow Wall Street is more important than Main Street,” Cantwell said.
Murray Statement on Reconfirmation of Ben Bernanke as Chairman of the Federal Reserve
“Across our nation today, Americans are hurting. The economy is struggling and while it seems like Wall Street is doing just fine, Main Street continues to suffer. It’s the slow pace of our recovery, coupled with continued excess by big financial institutions, that has caused Americans to question whether Ben Bernanke is deserving of a second term as head of the Federal Reserve.
“There’s no question that the Fed’s policies haven’t been perfect. Millions of American families and thousands of businesses have suffered considerable economic hardships. Unemployment remains high and small businesses still can’t access the credit they need. There are still signs of fragility in our housing markets. And I’m absolutely furious that Wall Street is returning to a ‘bonuses as usual’ mentality when so many Americans are still struggling.
“But, looking back over the past 18 months, at how close our financial system came to the brink, I believe that the Federal Reserve took forceful and effective action to prevent a collapse of global financial markets and a full-fledged economic depression in the United States.
“The Federal Reserve aggressively lowered interest rates to stimulate demand and drive economic growth. And the Fed created new, unprecedented programs to provide credit to households for consumer, auto, credit card and student loans. And it helped keep credit flowing to businesses when frozen credit markets threatened mass failures and job losses. The Fed’s actions are continuing to maintain stability today.
“The concern across our state and nation about the pace of our recovery is understandable. I share that concern. I have shared it with Ben Bernanke directly. I told him I expect accountability and transparency from the Fed and a commitment to put the needs of American consumers ahead of Wall Street banks. And while I hope to see a shakeup in the Administration’s economic policies and a true push for reform on Wall Street, I will vote to reconfirm Ben Bernanke because we need his experience to help maintain the stability of our financial systems in this challenging time.”