Bernanke’s bumpy return

Congress must work to create a more transparent Federal Government.

The Senate voted last week to reconfirm Ben Bernanke as chairman of the Federal Reserve by a vote of 70-30, the closest vote ever for a Fed nominee. In a polarized political environment, the vote was a rare display of bipartisanship; among the dissenters were 18 Republicans and 12 Democrats, including MinnesotaâÄôs Sen. Al Franken. Chairman Bernanke has overseen both the bursting of a foreseeable housing bubble and a rapid, shadowy expansion in the size and power of the unelected Federal Reserve. The economic crisis wrought by the bubbleâÄôs bursting may have required extraordinary intervention, but the FedâÄôs ongoing obfuscation has prevented a thorough evaluation of the efficacy and equity of its or the chairmanâÄôs performance. Though only a small piece of the overall expansion of the FedâÄôs balance sheet, the actions taken to rescue AIG offer an illuminating example of the FedâÄôs culture of secrecy. This $62 billion bailout brought many banks a 100 percent return on their bad assets. Despite this extraordinary intervention, the Fed has yet to fully account for who it has given money to or why. Subpoenaed e-mails from the FedâÄôs AIG program manager indicate a general disdain for openness and a reluctance to provide information to Congress. This attitude ill serves an economy wracked by ongoing crisis. Transparency and open dialogue are the hallmarks of effective decision-making. Congress must remember this and enhance its oversight of the Fed; many of its past actions, too, still require closer scrutiny.