Sen. Jeff Merkley became the first Democratic senator to say he’ll vote against nominating Ben Bernanke for a second term, saying that the Federal Reserve chairman has prioritized Wall Street over Main Street.
He joins three Republicans — Jim Bunning of Kentucky, Jim DeMint of South Carolina and David Vitter of Louisana — who have announced their plans to vote against Bernanke. Independent Bernie Sanders has also indicated that he plans to oppose the Fed chair’s nomination. John McCain, a Republican from Arizona, announced at a news conference on Wednesday that he is “leaning against” Bernanke’s confirmation.
Merkley, an Oregon senator and member of the Senate Committee on Banking, Housing and Urban Affairs, released a statement, in which he said that Bernanke “failed to recognize or remedy the factors that paved the road to this dark and difficult recession. Following our economic collapse, it is also apparent that he has not changed his overall approach to prioritizing Wall Street over American families.”
Here is the rest of his statement:
“Our nation is just beginning to emerge from the greatest financial crisis since the Great Depression, and there is no guarantee we will continue on the road to recovery over the long or short terms. Unemployment remains far too high, credit is unavailable to too many businesses, and families are plagued by falling home prices and high foreclosure rates. Even as we move forward with our efforts to get our economy back on track, it is critical we carefully examine what led us to this point.
“For too many years, federal regulators turned a blind eye to signs of an impending financial crisis. Tricks and traps proliferated in the credit card and consumer lending industries. Predatory mortgage loans exploded, fueling an unsustainable housing bubble. Regulators lifted rules requiring banks to keep adequate capital, and a laissez-faire approach to securitization, derivatives, and proprietary trading encouraged excessive risk-taking on Wall Street. As a member of the Board of Governors, Chair of the Council of Economic Advisers, and then ultimately as Chairman of the Board of Governors, Dr. Bernanke supported each of these decisions, failing to take the necessary precautionary steps that could have averted or mitigated financial collapse.
“These failures are very relevant to the future. We need economic leaders who understand that the ultimate goal of economic policies and the key to meaningful economic recovery should be financially successful families, not oversized Wall Street profits.
“Indeed, it should be recognized that although Wall Street prospered in the short-term from reduced leverage requirements, securitization of faulty mortgages, and the explosion of derivatives, Americans did not. The expansion that occurred from 2002 to 2007 became the first economic expansion in which working families were worse off at the end than at the beginning. This is not a path that we can afford to travel again.”