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Friday, November 11, 2005

Bernanke and Budget Deficits

Senator Schumer says he has been assured by Bernanke that he will speak out on the budget deficit issue:

Nominee for Fed Chief Wins Backing of Schumer, by Edmund L. Andrews, NY Times: A leading Senate Democrat ... endorsed President Bush's nomination of Ben S. Bernanke to become chairman of the Federal Reserve. "I think he's going to be an outstanding Fed chairman, and I think he's going to be in the mold of Alan Greenspan," said Senator Charles E. Schumer of New York, a member of the Senate Banking Committee, after a 45-minute meeting with Mr. Bernanke. ... Mr. Schumer's emphatic endorsement means that Democrats are likely to clear the path for an easy confirmation. "I think the only people who might not like him are on the far right or the far left," ... Mr. Schumer said he had received assurances from Mr. Bernanke that he would follow the lead of Mr. Greenspan and speak out about fiscal policy and about the need to reduce deficits. That is a shift for Mr. Bernanke, who ... initially told lawmakers and others that he would avoid commenting on fiscal policy if he became Fed chairman. But Democrats are hoping that Mr. Bernanke will echo the view of Mr. Greenspan that tax cuts should be paid for with savings in other areas. ...

I thought a criticism of Greenspan was that he didn't speak out forcefully enough on the deficit issue, and I'm not sure that's an accurate reflection of what Democrats want. In other deficit news:

G.O.P. Dissension Delays Vote on Budget-Cutting Bill, by Carl Hulse, NY Times: Facing defeat, House Republican leaders on Thursday abruptly called off a vote on a contentious budget-cutting bill in a striking display of the discord and political anxiety running through the party's ranks. Despite making major concessions to moderate Republicans, the House leadership failed to win enough converts to the budget plan and surrendered in mid-afternoon. Leading Republicans said they would try again next week to find a bare majority for more than $50 billion in spending cuts and policy changes. ... It was a stunning retreat for a Republican majority that has prided itself on iron party discipline and an ability to consistently win even the most difficult floor votes ... And the fiscal fight is not limited to the House. Also on Thursday, Senate Republicans on the Finance Committee had hoped to approve a bill .... But they were forced to postpone a vote after failing to win over a key dissident, Senator Olympia Snowe, Republican of Maine, despite two hours of closed door talks. ... In the House, .... top Republicans said a main impediment was the unity of the Democrats...

    Posted by on Friday, November 11, 2005 at 12:22 AM in Budget Deficit, Economics, Monetary Policy, Politics | Permalink  TrackBack (1)  Comments (3)


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