Why Obama's Job Summit is Too Little Too Late

Here's the big picture (from the Calculated Risk web site):


This is a horrible picture. This situation didn't "just happen" over the last few weeks or months. This was obvious by October 2008 but Bush wouldn't act because of his ideology and Obama hasn't acted because he wants to be "moderate" and not extreme. His tepid "do as little as possible" reminds me of Herbert Hoover, a guy with a sterling reputation like Hoover, but a twit who couldn't bring himself to act when the utterly obvious stared him in the face. What a tragedy.

Pity the poor United States, two incompetents for president right in a row. One show pushed the country to the edge of the abyss and let it slide over. And the other who stands on the brink and makes speeches as the economy and the country slide deeper into the abyss. Tragic!

...so Bush and Obama failed the people, what about the "independent" Federal Reserve which has a mandate that requires balancing two needs (sound money and encourage economic growth), Calculated Risk points out that Bernanke has wandered into the political arena where he shouldn't be. Bernanke is making the same kind of ridiculous right wing ideological prognostications that Greenspan did before him:

In his 2001 testimony, Fed Chairman Alan Greenspan testified before the House Committee on the Budget, and while offering his usual cautions and caveats, Greenspan talked of surpluses for the foreseeable future.

Greenspan spoke of "an on-budget surplus of almost $500 billion ... in fiscal year 2010". The National Debt would soon be retired and the Boomer's retirements secure. Greenspan offered a projection of "an implicit on-budget surplus under baseline assumptions well past 2030 despite the budgetary pressures from the aging of the baby-boom generation, especially on the major health programs."

How did that work out?

The key point is that for the Fed to remain independent, the Fed Chairman - as a rule - should avoid all discussions of fiscal policy.

Now comes Fed Chairman Bernanke today on the deficit. From Ryan Grim at Huffington Post:

"Well, Senator, I was about to address entitlements," Bernanke replied [to Senator Bennett]. "I think you can't tackle the problem in the medium term without doing something about getting entitlements under control and reducing the costs, particularly of health care."

Bernanke reminded Congress that it has the power to repeal Social Security and Medicare.

"It's only mandatory until Congress says it's not mandatory. And we have no option but to address those costs at some point or else we will have an unsustainable situation," said Bernanke.
...
"Willie Sutton robbed banks because that's where the money is, as he put it," Bernanke said. "The money in this case is in entitlements."

No matter if people agree or disagree with Bernanke, to maintain independence the Fed Chairman should not be commenting on the deficit and entitlements.

Worse than what the above implies, Bernanke is appointed and not elected so he is beyond the reach of the people. Therefore he should not be pontificating on political matters. Those rightfully reside with the elected representatives who must face the public in elections. As an unelected official Bernanke should stick to technical matters and not indulge his obvious predelection for right wing politics.