Ben Bernanke

The Honorable Ben Shalom Bernanke (born December 13, 1953) (pronounced \ber-NAN-kee\, \bər-'nan-kē\ or ), a Jewish American macroeconomist, is the Chairman of the Board of Governors of the United States Federal Reserve ("the Fed"). He was previously Chairman of the U.S. President's Council of Economic Advisers (CEA), and member of the Board of Governors of the Federal Reserve, serving from August 2002 until just prior to his June 2005 swearing-in as CEA chairman. Bernanke was previously the chairman of the Department of Economics at Princeton University.

Bernanke is married to Spanish instructor Anna Bernanke, who taught at Princeton Day School, and with whom he has two children.

On October 24, 2005, President George W. Bush nominated Bernanke to succeed Alan Greenspan as Chairman of the Federal Reserve. Bernanke was sworn in on February 1, 2006.

Career

Born in Augusta, Georgia (to Philip, a pharmacist, and Edna, a schoolteacher), he graduated from a high school (with 1590 out of 1600 on his SAT) in Dillon, South Carolina in 1971?, from Harvard University (summa cum laude) in 1975, and earned his PhD at the Massachusetts Institute of Technology in 1979. He taught at Stanford University from 1979 until 1985, was a visiting professor at New York University and has since then been a tenured professor in the Department of Economics at Princeton University. He chaired that department from 1996 until September 2002, when he went on public service leave. He resigned his position at Princeton July 1, 2005. He has given several important lectures at the London School of Economics on monetary theory and policy and written three textbooks on macroeconomics. In 1997, Bernanke earned his FAA private helicopter license, concluding over four years of weekend flight training.

He was the Director of the Monetary Economics Program of the National Bureau of Economic Research and the editor of the American Economic Review.

He has a strong interest in the causes of the Great Depression, a period in U.S. history accompanied by substantial monetary deflation as result of deliberate actions of the federal reserve.

In 2002, when the word "deflation" began appearing in the business news, Bernanke gave a speech about deflation. In that speech, he mentioned that the government in a fiat money system owns the physical means of creating money. Control of the means of production for money implies that the government can always avoid deflation by simply issuing more money. (He referred to a statement made by Milton Friedman about using a "helicopter drop" of money into the economy to fight deflation.) Bernanke's critics have since referred to him as "Helicopter Ben" or to his "helicopter printing press". In a footnote to his speech, Bernanke noted that "people know that inflation erodes the real value of the government's debt and, therefore, that it is in the interest of the government to create some inflation." ^*

He is believed to be less ideologically rigid than Alan Greenspan and has been reluctant to weigh in on political issues. For example while Greenspan publicly supported the Bush tax cuts Bernanke, when questioned about taxation policy, said that it was none of his business, his exclusive remit being monetary policy, and said that fiscal policy and wider society related issues were what politicians were for and got elected for. Indeed, in his undergraduate economics textbooks he somewhat distances himself from the overt economic libertarianism of Greenspan and stresses that Adam Smith was in fact quite concerned about things like relative inequality.

His first months as chairman of the Fed were marked by difficulties communicating with the media. An advocate of more transparent Fed policy, he had to back away from his initial idea of stating clearer inflation goals as such statements tended to drastically affect the stock market. Maria Bartiromo disclosed on CNBC their private conversation on Fed policy, and he has since been criticized for making public statements about Fed direction.^*

Career Controversy

Due to the fact that Bernanke has never actually worked in corporate America in his lifetime, investors argue that he is not suited for his position as Chairman of the Fed. Despite his scholastic achievements, he has been ridiculed that too many of his decisions are based not on real life economic experience, but on theory, which is the only basis of his career to date.

Awards and fellowships

Fellow, Econometric Society (1997)

Bibliography

References

Andrews, Edmund L. (Nov. 5, 2005). "All for a more open Fed". New Straits Times, p. 21.

External links