Treasury Secretary Timothy Geithner warned that the financial markets would view a Senate rejection of Ben Bernanke’s renomination as “very troubling” but said he’s sure the embattled Federal Reserve chairman will prevail.
“We’re very confident that the chairman will be reconfirmed by the Senate, and we think it’s very important he be reconfirmed by the Senate,” Geithner said Friday in an interview at the Treasury for POLITICO’s new video series, “Inside Obama’s Washington,” debuting Monday.
“He’s done a remarkable job of helping steer this economy out of the great recession. And I think he’ll play a very important role in helping in the success of our efforts to try to make sure we are bringing this economy back to durable growth.”
Given that, why not reject Mr. Bernanke? There are other people with the intellectual heft and policy savvy to take on his role: among the possible choices would be my Princeton colleague Alan Blinder, a former Fed vice chairman, and Janet Yellen, the president of the San Francisco Fed.
But — and here comes my defense of a Bernanke reappointment — any good alternative for the position would face a bruising fight in the Senate. And choosing a bad alternative would have truly dire consequences for the economy.
We heard the same thing about why Geither had to be confirmed. Why TARP had to pass in 2008. Why the stimulus had to be passed in 2009. Why health-care reform has to pass. Why cap-and-trade has to pass.
Now it’s Bernanke? Are we really supposed to believe the sky’s going to fall if the Senate fails to approve him?