Bernanke’s controversial hearing? – NBC New York

Ben Bernanke may be up for confirmation as Federal Reserve chairman, but that doesn’t mean hearing about his confirmation will be painless.

Senate aides from both parties predict a contentious hearing, with heavy criticism from both the left and the right.

Republicans plan to use the fall public hearing as a forum to debunk the Obama administration’s fiscal policies, tackle the deficit and save the railroads.

Democrats, some of whom would prefer a liberal candidate, plan to grill Bernanke about why the Fed wasn’t more proactive before the financial crisis last year.

“There will be a thorough and comprehensive confirmation hearing,” committee chairman Senator Chris Dodd said this morning. “I expect there will be a lot of serious questions about the role of the Federal Reserve going forward and what powers it should and shouldn’t have.”

Sen. Richard Shelby, the top Republican on the Banking Committee, says he plans to highlight the Fed’s failures as a bank regulator, how those failures contributed to the financial crisis and whether Chairman Bernanke’s work as the top regulator merits reconfirmation.

“I don’t think he’ll have a problem with votes, but the process will be interesting,” said a Senate aide. “I don’t think auditions are painless.”

Senate aides said Tuesday that no time had been set for Bernanke’s hearings.

Bernanke, who joined President Obama on Martha’s Vineyard this morning to announce his re-nomination, has drawn praise for the 2008 Wall Street financial crisis. Bernanke, former chairman of Princeton University’s Department of Economics. A bold approach to the crisis, in favor of cutting interest rates and flooding the markets with cash.

But Dodd — facing a daunting re-election bid in 2010 and under mounting criticism that he is too close to Wall Street — is expected to lead Bernanke on questions ranging from regulatory reform to TARP to consumer protections.

There are also bound to be questions on the left about whether Bernanke could have done more to prevent the subprime crisis.

“As a result of the greed, irresponsibility and illegal behavior of Wall Street, our country has suffered the worst economic downturn since the Great Depression,” said Sen. Bernie Sanders (I-Vt.). “Mr. Bernanke was the head of the Fed and the nation’s chief economist as this crisis unfolded, fueled by reckless speculation. Tragically, like the rest of the Bush administration, he was asleep at the wheel during this period and did nothing to move us forward. Financial system on safer ground.

Republicans say they will focus their questions on the transparency of the Fed’s actions and the distribution of Wall Street bailout money.

“I hope Chairman Bernanke comes to his confirmation hearing with a final, concrete plan to end these massive bailout programs,” said Sen. David Vitter (R-La.). “If he is reappointed, Mr. Bernanke should dedicate his second term at the Fed to ending this dangerous approach.”

And some Republicans see a political opening to take on Obama’s economic agenda.

“Chairman Bernanke’s testimony hearing will be an opportunity for the chairman to provide more transparency on the actions taken by the Fed and more insight into the cumulative impact the administration’s trillions in new spending, borrowing and debt will have on the American taxpayer,” he said. Senate Minority Leader Mitch McConnell.

Sen. Jim Bunning (R-Ky.), Bernanke’s biggest critic, is promising to put some serious weight — and vote “no” — on the confirmation hearing.

“I am very disappointed that President Obama has decided to continue to nominate Ben Bernanke to be chairman of the Federal Reserve System. – said Bunning. “Chairman Bernanke is part of the problem, not the solution.”

Democrats say they will be wary of Republican efforts to politicize the hearings.

“There are legitimate criticisms of the Fed, particularly because it has dropped the ball on consumer protection over the years,” said Sen. Chuck Schumer, the committee’s Democrat. “But Chairman Bernanke’s testimony hearing should not be used as a stage by those with misguided political agendas such as reducing the Fed’s independence.”