Ben Bernanke
Ben Shalom Bernanke[2] (/bərˈnæŋki/ bər-NANG-kee; born December 13, 1953) is an American economist who served as the 14th chairman of the Federal Reserve from 2006 to 2014. After leaving the Federal Reserve, he was appointed a distinguished fellow at the Brookings Institution.[3][4] During his tenure as chairman, Bernanke oversaw the Federal Reserve's response to the late-2000s financial crisis, for which he was named the 2009 Time Person of the Year.[4] Before becoming Federal Reserve chairman, Bernanke was a tenured professor at Princeton University and chaired the Department of Economics there from 1996 to September 2002, when he went on public service leave.[4] Bernanke was awarded the 2022 Nobel Memorial Prize in Economic Sciences, jointly with Douglas Diamond and Philip H. Dybvig, "for research on banks and financial crises",[5][6] more specifically for his analysis of the Great Depression.
Ben Bernanke
Roger Ferguson
Donald Kohn
Janet Yellen
George W. Bush
Barack Obama
Alan Greenspan
George W. Bush
Edward W. Kelley Jr.
George W. Bush
Independent (2015 or earlier–present)
Republican (before 2015 or earlier)
Anna Friedmann
2
From August 5, 2002, until June 21, 2005, he was a member of the Board of Governors of the Federal Reserve System, proposed the Bernanke doctrine, and first discussed "the Great Moderation"—the theory that traditional business cycles have declined in volatility in recent decades through structural changes that have occurred in the international economy, particularly increases in the economic stability of developing nations, diminishing the influence of macroeconomic (monetary and fiscal) policy.
Bernanke then served as chairman of President George W. Bush's Council of Economic Advisers before President Bush nominated him to succeed Alan Greenspan as chairman of the United States Federal Reserve.[7] His first term began on February 1, 2006.[8] Bernanke was confirmed for a second term as chairman on January 28, 2010, after being renominated by President Barack Obama, who later referred to him as "the epitome of calm."[9] His second term ended on January 31, 2014, when he was succeeded by Janet Yellen on February 3, 2014.[10]
Bernanke wrote about his time as chairman of the Federal Reserve in his 2015 book, The Courage to Act, in which he revealed that the world's economy came close to collapse in 2007 and 2008. Bernanke asserts that it was only the novel efforts of the Fed (cooperating with other US agencies and agencies of other governments) that prevented an economic catastrophe greater than the Great Depression.[11]
Statements on deficit reduction and reform of Social Security/Medicare[edit]
Bernanke favors reducing the U.S. budget deficit, particularly by reforming the Social Security and Medicare entitlement programs. During a speech delivered on April 7, 2010, he warned that the U.S. must soon develop a "credible" plan to address the pending funding crisis faced by "entitlement programs such as Social Security and Medicare" or "in the longer run we will have neither financial stability nor healthy economic growth."[79][80] Bernanke said that formulation of such a plan would help the economy in the near term, even if actual implementation of the plan might have to wait until the economic outlook improves.[81]
His remarks were most likely intended for the federal government's executive and legislative branches,[82] since entitlement reform is a fiscal exercise that will be accomplished by the Congress and the President[83][84] rather than a monetary task falling within the implementation powers of the Federal Reserve. Bernanke also pointed out that deficit reduction will necessarily consist of either raising taxes, cutting entitlement payments and other government spending, or some combination of both.[85]
Nobel Prize[edit]
In 2022 Bernanke was awarded the Nobel Memorial Prize in Economic Sciences along with Philip H. Dybvig and Douglas Diamond. Their research suggested that the Great Depression was caused by a variety of factors including credit market stress and a failing gold standard. With a rising External Finance Premium lenders and borrowers were both inclined to protect their financial health due to stressed credit markets. Lenders began tightening credit standards and avoiding risky borrowers while borrowers withdrew their cash. These self-preservation decisions from both lenders and borrowers resulted in further stress on the credit market and stagnation in investment spending. In addition to stressed credit markets, the failing gold standard also played a crucial role. After World War 1 most countries had their currencies tied to gold as well as fixed exchange rates, however, post-war animosity between many European nations led to non-cooperation regarding the gold standard. Consequently, the gold standard failed in the late 1920s, bringing prices, money supply, and output down with it. Their research showed that the combination of a failing gold standard and stressed credit markets led to a catastrophic spiral in the economy.[86]