President Bernanke

Continuing its unprecedented efforts to stabilize the financial markets, the Federal Reserve will implement next week a series of regulatory changes designed to end the most egregious misbehavior of mortgage lenders. A scholar of the Great Depression, Federal Reserve Chairman Ben Bernanke knows well the failures of past Federal Reserve activity and he is determined to chart a better course amid the current crisis.

Today, Bernanke proposed new legislation to formalize some of the ad hoc procedures undertaken by the Fed in February and March. Meanwhile, the Bush administration's
"Paulson Plan" would restructure the eighty-five year old financial system in a way that would end daily supervision of large banks by the Federal Reserve. Bernanke warned Congress that ending such supervision would effectively prevent the Fed from doing its job. For Bush to propose restructuring the financial system without consulting the Federal Reserve Chair is foolish enough, but to hamstring the only Republican in Washington who is actually doing something about the financial crisis is almost criminal.

No matter what you think of the Bear Stearns "bailout" in the larger sense of economic justice, Bernanke certainly did his job. Despite some early hesitancy, Bernanke has learned from his mistakes. Unlike our actual President, who has been worse than useless, Bernanke has acted boldly and creatively, stepping into the void and doing whatever he can to help. Compared to Alan Greenspan's aloof and smug indifference in the face of financial firestorms, Bernanke's humble willingness to man the bucket line is refreshing.