Policy over politics

4 December 2009 By James Pethokoukis

Chris Dodd, head of the banking committee, faces the reelection fight of his life. So opposing the unpopular Fed chief s renomination would ve been an easy political win. Supporting Bernanke suggests he s more interested in leaving a legacy of financial reform than another term.

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Senate Banking Committee Chairman Christopher Dodd, who has championed a proposal that would restrict the Federal Reserve's reach, said at Ben Bernanke's confirmation hearing that his reappointment as central bank chairman would send the "right signal" to financial markets and efforts to derail the nomination would fail. "I think the majority of the members will support the chairman," Dodd told reporters.

Dodd wants to strip the Fed of its bank regulatory powers and unify the fragmented structure of U.S. bank oversight under one roof. He would also require presidential appointment and Senate confirmation of regional Federal Reserve bank board chairmen, taking away a prerogative enjoyed by the 12 regional Fed banks, a proposal directly opposed by Bernanke during testimony.

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