By Victoria McGrane
Six Republicans and one Democrat on the Senate Banking Committee voted Thursday against Ben Bernanke’s nomination to a second four-year term as chairman of the Federal Reserve — signaling to some Fed watchers that President Barack Obama’s pick could be in more trouble than previously thought.
“It’s not the foregone conclusion it was a couple of weeks ago,” said Brian Gardner, a bank analyst with Keefe, Bruyette & Woods.
Two aspects of the two-hour debate that preceded the committee vote struck Gardner as worrisome for Bernanke: the unenthusiastic — even apologetic — tone from some of the senators who voted yes and a dispute over the Fed’s refusal to release documents about the bailout of insurance giant American International Group to senators on the committee.
Sens. Jim Bunning (R-Ky.) and David Vitter (R-La.), in particular, complained about the Fed’s lack of transparency. In the case of AIG, some banking committee staffers were allowed access to documents, Bunning said, but individual senators and the public were not allowed to see the information because the Fed said it was “protected.”
That spat could have legs, Gardner said, and if it resonates with a public already fuming at the Fed, it could sway the votes of yes-leaning senators.
Read the rest at Politico.
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