Who saved the world?
President Obama claimed during his campaign for the presidency that he would bring back civility to government and work closely with his opponents. But the reality of governing has pushed Obama in the same direction as his predecessors — towards partisanship.
In his speech one week ago in New York City, President Obama stated: “The only way to address successfully any of these challenges was to address them together, and so this administration — with terrific leadership by my Treasury Secretary, Tim Geithner, as well the Chair of my Council of Economic Advisors, Christy Romer, and the Chair of the National Economic Council, Larry Summers — moved quickly on all fronts, initializing a financial stability plan to rescue the system from the crisis and restart lending for all those affected by the crisis.”
Nowhere in his speech did he mention or acknowledge the central role played by Ben Bernanke, the Chair of the Federal Reserve. Obama deserves credit for re-appointing Bernanke for another term as Chair. However, Bernanke is Republican who originally was appointed by President Bush. Probably for these reasons, Obama did not want to give him credit, for this would have diminished the role of his administration.
I have been claiming for more than a year that the U.S. and the world were fortunate to have had Bernanke runnnig the Fed when the crisis started. He is by far the brightest person in Washington, and almost single-handedly prevented the U.S. and most global economies from spiraling downward into a depression.
The naysayers who claim his policies will lead the U.S. towards hyper-inflation have no understanding of his policies or appreciation of his talent. They will be greatly disappointed when the inflation spiral does not materialize and their investments turn sour. Hopefully, no one will bail them out at that time.
Yet, the President credited his economic advisors for having saved the economy. Geithner did contribute, but in his role as head of the New York Fed. Romer and Summers have been largely inconsequential thus far. Washington in general, other than for Bernanke and the Fed, have been more of a hindrance to the recovery. The much vaunted fiscal stimulus is only now beginning to kick in. It played no role in turning around the economy and confidence during the first three quarters of 2009.
I also have said for most of the past year that the U.S. economy would greatly benefit if Congress would just go away on an extended holiday and do as little as possible on the economic front. Fortunately, they have turned their attention to health care for the time being.
In my opinion, Bernanke should be placed on a fast track for sainthood, and should be awarded next year’s Noble Prizes for both Economics and Peace. Indeed, he has done more for global stability and peace than most of the past winners of the Noble Peace Prize.