Ben Bernanke appears gleefully unfazed by the heat he's taken from Republican lawmakers. This morning the Federal Reserve chairman reiterated to the Joint Economic Committee that Congress should not cut spending sharply while the economy is weak, adding that the Fed is prepared to take additional steps to boost the U.S. economy if intervention is needed.
The move comes weeks after Republican leaders in Congress wrote a rare letter to Bernanke urging him against lowering interest rates even further and follows Texas Governor Rick Perry's veiled threat to rough up the possibly-treasonous chairman if he continues fiddling with the economy.
The economic plan Bernanke is asking for is a delicate one: don't cut spending in the short-term but in the long-term, cut spending by more than the $1.5 trillion assigned to the Super Committee. The Fed “will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in a context of price stability,” he said. As the AP reports, Bernanke went into deeper detail about his prescriptions for Congress last week:
In a speech in Cleveland last week, Bernanke called long-term unemployment a "national crisis" and said Congress should take further steps to address it. Bernanke noted that about 45 percent of the unemployed have been out of work for at least six months – a level previously unseen in the six decades since World War II.
In that speech, Bernanke said there was only so much the Fed's interest rate policies could achieve. He said that long-term unemployment, budget deficits and the depressed housing market were three priority areas that Congress should address.