They likened him to a traitor. They hinted darkly that he might suffer violence because of his actions in office. They said they wanted him fired. But when Fed Chairman Ben Bernanke was invited to respond to the Republican presidential candidates who have made him a whipping boy, he turned the other bearded cheek. “You haven’t had a very good time in all the Republican presidential debates,” Greg Robb of MarketWatch told the slight and scholarly chairman at Wednesday afternoon’s news conference at the Federal Reserve.
Bernanke smiled and nodded his agreement. “I’m not going to get involved in political rhetoric,” he said. “I have a job to do.”
In a sense, Bernanke didn’t need to rebut his critics; the facts already have. Earlier Wednesday, the Fed reported that expectations are inflation will remain between 1.4 percent and 1.8 percent for 2012 and between 1.5 percent and 2 percent through 2014. The exceptionally low inflation rate proves false the complaints about Bernanke’s aggressive — and successful — actions to avert an economic depression after the 2008 financial crisis.
Former candidate Rick Perry has been the worst of the critics, calling Bernanke’s behavior “almost treasonous” and declaring that Bernanke would face an “ugly” greeting in Texas if he injected more monetary stimulus into the economy. “It’s a travesty that young people in America are seeing their dollars devalued,” Perry complained.
Newt Gingrich called Bernanke “the most inflationary, dangerous and power-centered chairman of the Fed in the history of the Fed.” Ron Paul accused Bernanke of “inflating twice as fast as Greenspan.” Mitt Romney joined the others in saying he wouldn’t reappoint Bernanke, who was first appointed by President George W. Bush.
On Wednesday, Bernanke allowed himself just a passing reference to such critics. “The low level of inflation is a validation,” he said. “There were some who were very concerned that our balance-sheet policies and the like would lead to high inflation. There’s certainly no sign of that yet.”
He deserves credit for keeping his equanimity as the Republican candidates abuse him. And, at long last, he has some results to show for the work he has done. The Fed also announced Wednesday that it sees the economy growing at a rate of 2.8 percent to 3.2 percent next year and 3.3 percent to 4 percent the following year. Unemployment is forecast to be between 8.2 percent and 8.5 percent late this year, dropping to between 6.7 percent and 7.6 percent by the end of 2014.
Consumer sentiment, job growth and industrial production have all been improving. And the results of some of Bernanke’s most controversial policies, such as the enormous purchases of securities, have disproved the critics.
That the nation avoided an economic depression is due in no small part to the chairman, whose academic specialty is in the history of depressions. At a time when President Obama and lawmakers have squabbled themselves to irrelevance, Bernanke’s Fed has been a model of good government: apolitical, efficient, brutally effective — and transparent.
The news conference itself was an example of Bernanke’s attempt to demystify the central bank: He took his place at a carved wooden desk atop an aluminum platform and, after reading a prepared statement full of jargon (“the level of maximum employment is not immutable”), he fielded reporters’ questions for nearly an hour in a surprisingly blunt manner.
“There are some positive signs, no doubt,” he told CNBC’s Steve Liesman, but “I don’t think we’re ready to declare that we’ve entered a new, stronger phase.”
Paul and others would abolish the Fed because of such actions. But it’s reassuring that Bernanke is on the job and proving them foolish. For Republican presidential candidates, it’s worse than wrong to take aim at the one public servant who has done more than any other to keep the nation out of depression. It’s almost treasonous.