Taking Questions: Mr. Bernanke
Monday, July 27, 2009
Federal Reserve chairmen have long explained their decisions to Congress and groups of economists using dry and technical language. On Sunday night, Ben S. Bernanke showed a different side of himself.
Bernanke took questions from ordinary Americans in an unusual town-hall-style event in Kansas City, Mo., hosted by PBS anchor Jim Lehrer and set to be broadcast this week. It was part of a campaign by the Fed chairman to instill confidence in the economy and to position himself as a voice of calm leadership amid the financial crisis. Also, his term as chairman will end in January, and President Obama will decide in the coming months whether to reappoint or replace him.
Using atypically folksy language, Bernanke explained why he thinks the central bank responded appropriately to the financial crisis.
"I was not going to be the Federal Reserve chairman who presided over the second Great Depression," he said, defending the bailout of American International Group and other large financial firms. "I had to hold my nose and stop those firms from failing. I am as disgusted about it as you are."
Most of the substance of Bernanke's comments was familiar to those who closely track his speeches and congressional testimony. But the tone was decidedly different: He had more quips than usual, dispensed financial planning advice and repeatedly praised the quality of the questions posed to him.
"Economic forecasting makes weather forecasting look like physics," he said, offering a caveat before saying that Fed leaders forecast that the unemployment rate will top 10 percent by the end of the year. "The Federal Reserve has been putting the pedal to the metal," he said, explaining how the central bank has pushed short-term interest rates nearly to zero, doing about all it can to stimulate the economy with traditional tools.
The session is to be broadcast on the "NewsHour With Jim Lehrer" in portions Monday through Wednesday and as a one-hour special broadcast on PBS stations after that. It follows other recent steps in which Bernanke has taken his case to a broader audience than his predecessors ever did. In February, he took questions at the National Press Club in what amounted to a de facto news conference. In March, he appeared on "60 Minutes," the first time in two decades a Fed chairman had sat for a TV interview.
He even offered a relatively personal sense of the strains when the financial system was collapsing. "Those were some very long nights I spent on the sofa in my office trying to keep things together," he told a questioner.
Bernanke's extensive public appearances work at cross-purposes with a goal he set when he became chairman in 2006: He had a stated aim to avoid the high public profile that predecessor Alan Greenspan had. He has concluded over the past year, though, that in a financial crisis visible leadership can help improve confidence.
"One thing I tried to do when I became chairman was to try to depersonalize the Fed to some extent," he said Sunday night, before praising the many Fed staff members who have also helped respond to the crisis.
He answered vaguely when Lehrer asked him what still keeps him up at night.
"You going to sleep well?" Lehrer followed up.
"I'm pretty tired," Bernanke conceded.