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Opinion: Bernanke’s ’60 Minutes’ diplomacy -- did public outreach ensure second term as Fed chair?

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President Obama made it official today, interrupting his Martha’s Vineyard vacation to nominate Ben Bernanke for reappointment to another four-year term as chairman of the Federal Reserve.

The president said all the predictable things -- that the Fed chair had brought ‘bold action and outside-the-box thinking’ in a way that ‘helped put the brakes on our economic free-fall.’ You can read his full remarks below.

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And a lot of commentators suggested that Obama had no choice -- despite economic advisor Larry Summers’ evident hunger for the job. The president opted for a stability that would make Wall Street happy and avoided further inflaming relations with Congress at a time when Republicans are fighting healthcare reform and criticizing Atty. Gen. Eric Holder‘s probe of CIA abuses. (Bernanke’s reappointment still has to be confirmed by the Senate.)

But it’s just possible that Bernanke won his job on television. Bernanke has been a new kind of Fed chairman. First appointed by President Bush, the federal government’s banker has shown an Obama-like sensibility to public outreach.

In February, amid the greatest economic meltdown in nearly a century, he appeared before the National Press Club.

In March, he surprised Wall Street by giving an interview to CBS’ ‘60 Minutes,’ allowing unprecedented access to his thinking and his biography, even walking the streets of his hometown in Dillon, S.C., with CBS’ Scott Pelley. No Fed chair had ever granted a television interview before.


Watch CBS Videos Online

One financial website called it ‘a move by Bernanke to connect with Main Street, as U.S. citizens feel lost with the billions of bailout money being given to financial institutions while job losses mount.’ The U.S. News & World Report described it simply as ‘a great public relations move.’

Then in July, the former professor and expert on the history of the Great Depression stunned the world of finance by agreeing to a town hall moderated by PBS’ Jim Lehrer in Kansas City, Mo. Taking questions from owners of small businesses and social workers grappling with the effects on clients of home foreclosures, he translated complex Fed policy into common-sense language.

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Asked by a Kansas City mother why federal bailout money kept going to big firms, Bernanke explained, “When the elephant falls down, all the grass gets crushed as well.”

Today, Obama made no mention of Bernanke’s public outreach. But both men seemed to be in sync on one front: wearing dark blazers and white shirts, they sported no ties as they stepped to the podium. Hey, it’s summertime on Martha’s Vineyard.

-- Johanna Neuman

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Transcript as provided by the White House

THE WHITE HOUSE

Office of the Press Secretary

________________________________________________________________

For Immediate Release August 25, 2009

REMARKS BY THE PRESIDENT AND BEN BERNANKE AT THE NOMINATION OF BEN BERNANKE FOR CHAIRMAN OF THE FEDERAL RESERVE

Oak Bluffs School Filing Center

Oak Bluffs, Massachusetts

8:55 A.M. EDT

THE PRESIDENT: Good morning, everybody. I apologize for interrupting the relaxing that I told all of you to do, but I have an important announcement to make concerning the Federal Reserve.

The man next to me, Ben Bernanke, has led the Fed through one of the worst financial crises that this nation and the world has ever faced. As an expert on the causes of the Great Depression, I’m sure Ben never imagined that he would be part of a team responsible for preventing another. But because of his background, his temperament, his courage, and his creativity, that’s exactly what he has helped to achieve. And that is why I am re-appointing him to another term as Chairman of the Federal Reserve.

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Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and out-of-the-box thinking that has helped put the brakes on our economic freefall. Almost none of the decisions that he or any of us made have been easy. The actions we’ve taken to stabilize our financial system, to repair our credit markets, restructure our auto industry, and pass a recovery package have all been steps of necessity, not choice. They’ve faced plenty of critics, some of whom argued that we should stay the course or do nothing at all. But taken together, this ‘bold, persistent experimentation’ has brought our economy back from the brink. They’re steps that are working. Our recovery plan has put tax cuts in people’s pockets, extended health care and unemployment insurance to those who have borne the brunt of this recession, and is continuing to save and create jobs that otherwise would have been lost. Our auto industry is showing signs of life. Business investment is showing signs of stabilizing. Our housing market and credit markets have been saved from collapse.

Of course, as I’ve said before, we are a long way away from completely healthy financial systems and a full economic recovery. And I will not let up until those Americans who are looking for jobs can find them; until qualified businesses, large and small, who need capital to grow can find loans at a rate they can afford; and until all responsible mortgage-holders can stay in their homes. That’s why we need Ben Bernanke to continue the work he’s doing, and that’s why I’ve said that we cannot go back to an economy based on overleveraged banks, inflated profits, and maxed-out credit cards.

For even as we’ve taken steps to rescue our financial system and our economy, we must now work to rebuild a new foundation for growth and prosperity. We have to build an economy that works for every American, and one that leads the world in innovation, in investments, and in experts -- exports.

Part of that foundation has to be a financial regulatory system that ensures we never face a crisis like this again. We’ve already seen how lax enforcement and weak regulation can lead to enormous wealth for a few and enormous pain for everybody else. And that’s why even though there is some resistance on Wall Street from those who would prefer to keep things the way they are, we will pass the reforms necessary to protect consumers, investors, and the entire financial system. And we will continue to maintain a strong and independent Federal Reserve.

We will also keep working towards the reform of a health insurance system whose costs and discriminatory practices are bankrupting our families, our businesses, and our government. We will continue to build a clean energy economy that creates the jobs and industries of the future within our borders. And we will give our children and our workers the skills and training they need to compete for these jobs in the 21st century.

Much like the decisions we’ve made so far, the steps we take to build this new foundation will not be easy. Change never is. As Ben and I both know, it comes with debate and disagreement and resistance from those who prefer the status quo. And that’s all right, because that’s how democracy is supposed to work. But no matter how difficult change is, we will pursue it relentlessly because it is absolutely necessary to lift this country up and create an economy that leads to good jobs, broad growth, and a future our children can count on. That’s what we’re here to do, and that’s what we will continue to do in the months ahead. So I want to congratulate Ben on the work that he’s done so far, wish him continued success in the hard work that he has before him. Thank you so much, Ben.

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CHAIRMAN BERNANKE: Thank you, Mr. President. I’d like to express my gratitude to President Obama for the confidence he’s shown in me with this nomination, and for his unwavering support for a strong and independent Federal Reserve.

It has been a particular privilege for me to serve with the extraordinary colleagues throughout the Federal Reserve System. They have demonstrated remarkable resourcefulness, dedication, and stamina under trying conditions. Through the long nights and weekends and the time away from their families, they have never lost sight of the critical importance of the work of the Fed for the economic well-being of all Americans. I am deeply grateful for their efforts.

I especially want to thank my own family -- my wife Anna and our children, Joel and Alyssa. Without their support and sacrifice, I could not undertake this task.

The Federal Reserve, like other economic policymakers, has been challenged by the unprecedented events of the past few years. We have been bold or deliberate as circumstances demanded, but our objective remains constant: to restore a more stable financial and economic environment in which opportunity can again flourish and in which Americans’ hard work and creativity can receive their proper rewards.

Mr. President, I commit today to you and to the American people that, if confirmed by the Senate, I will work to the utmost of my abilities -- with my colleagues at the Federal Reserve and alongside the Congress and the administration -- to help provide a solid foundation for growth and prosperity in an environment of price stability.

Thank you, sir.

THE PRESIDENT: Thank you. Great job.

CHAIRMAN BERNANKE: Thank you.

END 9:01 A.M. EDT

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