Romney Wouldn’t Appoint Bernanke to New Fed Term
Romney said two of his top economic advisers, Glenn Hubbard of Columbia University and Greg Mankiw of Harvard University, are “excellent” aides when asked today during an interview on Fox Business Network. The former Massachusetts governor said he hasn’t considered a “single person” to replace the Fed chief, whose second term ends in January 2014.
“I would want to select someone who was a new member” and “someone who shared my economic views” to the top spot at the U.S. central bank, Romney said. He said he would seek someone to provide “monetary stability that leads to a strong dollar and confidence that America is not going to go down the road that other nations have gone down, to their peril.”
Romney’s comments contrast with those from Hubbard, who told Reuters this week that Bernanke should “get every consideration” to stay on after his term expires. Romney has said Bernanke doesn’t deserve a third term. The Fed chief hasn’t said he wants one.
“I don’t recall a time in which the chairmanship of the Federal Reserve was a campaign issue, and it makes me very uncomfortable that it is,” said Jerry Webman, who helps oversee $178.8 billion as chief economist for OppenheimerFunds Inc. in New York.
“You need a strong, independent central bank as part of a well-functioning modern economy,” said Webman, who said he is not happy with either party’s view on fiscal or economic issues. “Having the chairmanship become something that a presidential candidate talks about, like he would a cabinet official, to me suggests the Fed has some vulnerability on its independence.”
Hubbard told Reuters that Bernanke “is a model technocrat” who he has known since they were “practically kids” and that they speak to each other on a regular basis.
“He gets paid nothing for getting kicked around all the time,” Hubbard told Reuters. “I think they ought to pat him on the back,” he said. “I may or may not agree with him, but that’s very different from saying I question his motives. I wish politicians would stop doing that.”
Hubbard, chairman of the Council of Economic Advisers under former Republican President George W. Bush from 2001 to 2003 and now dean of Columbia’s business school in New York, didn’t respond to an interview request today. Mankiw, who succeeded Hubbard as chief of Bush’s economics panel in 2003, is chairman of the economics department at Harvard in Cambridge, Massachusetts.
Romney’s running mate, House Budget Committee Chairman Paul Ryan of Wisconsin, said today that he doesn’t want the Fed to increase economic stimulus. Many Fed policy makers said additional stimulus would probably be needed soon unless the economy shows signs of a durable pickup, according to minutes of their most recent meeting on July 31-Aug. 1.
“I’m not a fan of more stimulus or more easing,” Ryan said in a CNBC interview. “The benefits are clearly outweighed by the long-term costs of this. There--it’s not working, and all this loose money from the Fed is basically bailing out the fact President Obama has failed on fiscal policy.”
Bernanke, 58, was appointed as Fed chief by Bush in 2006 and re-appointed by Democratic President Barack Obama in 2010. Bernanke declined to answer when asked at a Jan. 25 press conference if he would resign should a Republican win the election and request that he quit.
“I’m not going to get involved in political rhetoric,” Bernanke told reporters. “I’m not going to be thinking about hypothetical situations in the future.”
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