Transcript: Thom Hartmann and Bernie Sanders discuss the reappointment of Ben Bernanke as chief of the Fed. 04 Dec '09.
Thom Hartmann: But of course, the first hour of our program as always, Senator Bernie Sanders . Our, the, I think of him as America’s senator. The, with our national, the longest running media, national town hall, political town hall I think in the history of the world going on right now. Senator Bernie Sanders, our Brunch with "Bernie hour". Bernie, welcome, welcome.
Bernie Sanders: Good to be with ya Thom.
Thom Hartmann: And you’re in Washington DC today.
Bernie Sanders: I am in the senate studios, we have a beautiful studio.
Thom Hartmann: Oh that’s great, that’s great. And you’re lookin’ marvelous.
Bernie Sanders: My tie is on straight and we’re ready to go.
Thom Hartmann: There you go, there you go. Bernie you put a hold, and god bless you for it, you put a hold on the nomination, or the renomination or whatever you call it, reappointment of Ben Bernanke to be chief of the Fed. And in the news release that you issued you put out the four things that he is supposed to do as Fed chief that he’s not doing. You wanna give us a summary of that?
Bernie Sanders: Absolutely. The Fed has four major responsibilities. Number one: to conduct monetary policy in a way that leads to maximum employment. Well, with 17% of our people unemployed or under employed I think really he hasn’t done that. Second of all, to maintain the safety and soundness of financial institutions. And I think this is the main critique. The main critique of Bernanke is he was asleep at the switch.
Bernie Sanders: While Wall Street was engaged in highly speculative and reckless activities, his job was to tell them you can’t do that, tell the American people what was going on, and he really did not do that.
Thom Hartmann: And may I add in the midst of all this now he is saying that he thinks the Fed should have more power?
Bernie Sanders: Right.
Thom Hartmann: To overlook this stuff?
Bernie Sanders: Right.
Thom Hartmann: Pardon my interrupting you.
Bernie Sanders: And another area that they have responsibility deals with protecting consumers against deceptive and unfair financial products. Well, Thom, on this show, week after week, month after month, people call in. And they say, 'you know, we have paid our credit card bills on time every single month and Bank of America or somebody else has just doubled or tripled my insurance rates, my interest rates. I’m paying 25, 28%.' That is not protecting the American people from unfair lending practices. I think no matter how you look at it, he failed in terms of his oversight, in terms of maintaining the safety and soundness of the financial institutions.
And second of all, and equally important, since the collapse of Wall Street there are many things he could have done. For example, he could have insisted that the bailed out institutions make low interest loans available to small and medium sized businesses who desperately need that credit in order to create good paying jobs. He could have put a cap on interest rates on credit cards to protect American consumers. One of the amazing things that’s happened since the collapse of Wall Street and the bail out is, as you know, the congress against my vote provided 700 billion dollars because institutions were too big to fail. Well you know what’s happened since the bail out is 3 out of the 4 largest financial institutions in America become even larger. And many economists and the government of the UK, the central bank of the UK have moved to start breaking up large financial institutions. And in my view that is what we should be doing. But what he has done is in fact allowed some of the largest banks to become even larger.
And the last point, and an area where I have been working with a very conservative guy in the house, Ron Paul, is the issue of transparency. The Fed as part of the bail out provided trillions of dollars of zero interest loans to financial institutions. When I asked Bernanke as a member of the Budget Committee who has received those loans? He said, 'sorry, not gonna tell you'. So we are working on an audit of the Fed and an understanding of who has received trillions of dollars of zero interest loans and what the terms are.
So, I think bottom line here is Bernanke, who is a smart guy, I have no personal animosity towards him at all. Bernanke was part of the Bush Administration. He was in 2005 appointed as chairman of the Council of Economic Advisors by George W. Bush. The election of 2008 was an election for change and Barack Obama should not be appointing as head of the Fed one of the architects of the Bush economy. So we need a new direction in the Fed, we need a new direction on Wall Street. And we’re gonna fight as hard as we can to get a new nominee, one more responsive to the needs of the middle class, small business than Mr. Bernanke has been.
Thom Hartmann: Yeah. As that nominee, may I put forward the name of Joseph Stiglitz.
Bernie Sanders: Oh, Stiglitz is a world, he is a Nobel prize-winning economist. He is one name. There are others out there, Elizabeth Warren of Harvard.
Thom Hartmann: Yes I would, in a heartbeat.
Bernie Sanders: She has been extraordinarily good on many issues. I mean there are many economists out there. It’s not my job to tell the President who he should nominate, there are a plethora of really good people out there and he could have his pick, but it should not be Ben Bernanke.
Thom Hartmann: Bernie, Bernie. I think you were joined by two other senators in your hold on Bernanke’s nomination. What, you know, setting aside the righteous concerns that we have about this and the real issues that you just outlined, I mean they’re all just absolutely solid. But there are these very unfortunate political realities in Washington, DC, and particularly in the United States Senate where so many, or virtually all of the Republicans and a startling minority of Democrats are wholly owned subsidiaries of banks and financial institutions. What do you think the probabilities are that you’re gonna actually be able to block Bernanke’s nomination?
Bernie Sanders: Well I’ll tell ya Thom. What the pundits in the media are saying is well Sanders may slow it up a little bit he may force 60 votes but at the end of the day Bernanke is going to be re-appointed. Maybe they’re right, but I’m not so sure. Now what saddens me here, and where our listeners can play a very active role, and by the way for more information about this they should go to my website, sanders.senate.gov, is we’re seeing right wing senators, people like Bunning and DeMint coming on board and opposing Bernanke’s reappointment. I am not hearing progressive democrats coming on board to the degree that I want. We are working with some progressive organizations at the grassroots level. But I want to see a situation where the Democratic Party does not become perceived as the party of Wall Street while right wing Republicans are suddenly the great populists. So …
Thom Hartmann: Although they’re working at that with their tea party movement and everything.
Bernie Sanders: Well that’s right. And we have got to make sure that liberal and progressive democrats stand up and say we need a new Wall Street. A Wall Street which is not just concerned with huge profits and huge bonuses for their CEOs, but a Wall Street which helps create good paying jobs in the productive economy. And we’ve got to get progressives and liberals and moderates even on board this train. Because I think out at the grass roots of America, there is profound disgust at what Wall Street has done, anger at the irresponsibility of the Fed in overseeing what they are supposed to be doing, um, and we’ve got to move on this issue.
Thom Hartmann: Very well said. It’s our brunch with Bernie hour. Senator Bernie Sanders, he’ll be taking your calls. Your chance to talk to a United States senator who gets it. And be sure to check out Bernie’s website, sanders.senate.gov, action steps there, his news letter that you can sign up to. But also how you can help, help in this campaign to change the chairman of the Fed, change the economic direction of the United States.
Transcribed by Suzanne Roberts, Portland Psychology Clinic.