News & Notes: Bernanke confirmed for second term

Democrats voted 48-12 in favor of Bernanke’s reappointment, including the two Independents who caucus with the party, while Republicans supported Bernanke by a slimmer 22-18 margin. Both of New Jersey’s senators, Frank Lautenberg (D) and Robert Martinez (D), voted in favor of confirmation.

Before the Senate’s final vote, Bernanke’s nomination overcame a filibuster on a 77-23 procedural vote.

The central bank’s handling of the economy in the years prior to the financial crisis has been the subject of close scrutiny by members of both parties. President Obama and Bernanke’s supporters commended the Fed’s response to the financial collapse, citing the rescue of Wall Street banks and American International Group Inc. (AIG) as well as other actions taken to increase liquidity. But dissenting Senators criticized the Fed’s treatment of the housing and credit bubbles that preceded the crash, blaming the Fed for weak regulation of banks. Senators also criticized Bernanke as being overly supportive of the nation’s financial institutions at the expense of taxpayers.

The day before the confirmation vote, the Fed announced that it would keep short-term interest rates near zero, where they have been since late 2008.

President George W. Bush nominated Bernanke to replace Alan Greenspan as Fed chairman in 2005. Bernanke had previously served as a member of the Fed’s Board of Governors and as chairman of Bush’s Council of Economic Advisers.

The previous high for opposition to a Fed chair nominee came in 1983, when the Senate voted 84-16 to approve Paul Volcker ’49 for his second term.