The Senate Banking Committee today voted in favor of the reappointment of Federal Reserve chairman Ben Bernanke to serve a second term at the helm of the central bank.
The panel this morning voted 16-7 in support of Bernanke, with the opposition led by ranking Republican Richard Shelby of Alabama.
Republican senators Jim Bunning of Kentucky, David Vitter of Louisiana, Kay Bailey Hutchison of Texas, Mike Crapo of Idaho, and Jim DeMint of South Carolina, as well as Democrat Jeff Merkley of Oregon, also voted against the Fed chief.
"The crisis of 2008 was not days or weeks in the making," said Shelby. "It took years, and in many of those years chairman Bernanke supported the actions that contributed to the ultimate scale of the problems we encountered, a scale we have not seen since the Great Depression."
Bunning, who has adamantly opposed Bernanke for years, took issue with TIME Magazine yesterday naming the Fed chief its Man of the Year.
"One financial blogger wrote that this was like rewarding the captain of the Titanic for getting everyone off the sinking ship after he rammed it into the iceberg," Bunning said. "And chairman Bernanke may wonder if he really wants to be honored by an organization that has previously named people like Joseph Stalin twice, Yasser Arafat, Adolf Hitler, the Ayatollah Khomeini, Vladimir Putin, and Richard Nixon twice as their person of the year."
"Chairman Bernanke's time as Fed chair has been a failure," Bunning concluded. "We must put an end to his and the Federal Reserve's failures and there is no better time than now."
"Dr. Bernanke's approach helped set our economic house on fire," said Merkley, who acknowledged that Bernanke has at least been "quite adroit" at using a fire hose.
The panel's chairman, Chris Dodd of Connecticut – who has introduced a financial regulatory reform proposal that would curtail the Fed's powers – voted in favor of Bernanke, arguing that the economic crisis could have been far worse without the Fed chief's efforts.
"I believe that Ben Bernanke deserves substantial credit as chairman of the Federal Reserve for helping us navigate those waters, certainly not with perfection but certainly I think for stepping up at a critical time in our nation's history with some very wise leadership that benefited our nation," Dodd said. "The Federal Reserve took extraordinary actions to arrest this crisis and prevent utter economic catastrophe and I believe nothing short of that was at risk in the absence of those actions."
"And because he did what he did," continued Dodd, "I believe there is reason to believe that better days do lie ahead for our country as well – therefore I strongly support this nomination."
Bernanke's re-nomination to the Federal Reserve will now move on to the full Senate for a final vote, which is unlikely to take place until January. Independent Sen. Bernie Sanders from Vermont has placed a hold on Bernanke's nomination, so it will now require a super-majority of 60 votes to confirm the Fed chief.
Bernanke's first term ends on January 31. If after that date Bernanke has still not been reconfirmed, Dodd today said that Bernanke could continue to serve as a Fed board member but the vice-chairman would then assume the chairman's role.