WASHINGTON (CN) – The Senate confirmed Federal Reserve Chair Ben Bernanke 70-30 Thursday to a second four-year term, after he faced criticism from several lawmakers for bailing out Wall Street. Despite the solid majority, Bernanke’s confirmation was the narrowest ever for the position.
The confirmation was a win for the Obama administration, which re-nominated Bernanke, and which is currently trying to push economic reform legislation through Congress.
Lawmakers from both sides have criticized Bernanke. Some have said he worked too closely with the Obama administration in handling the bailouts, calling into question the reserve’s independence. Others said he contributed to the recession by ignoring the housing and credit bubbles and by allowing banks to maintain only small capital reserves.
Bernanke has admitted to underestimating the scale of the recession and for not acting fast enough.
But supporters of Bernanke have credited him with keeping the recession from turning into a depression, and have said that non-banking financial institutions, which were not under the control of the Federal Reserve, were the major factors in the economic downturn.
Bernanke supported the contentious $182 billion bailout of American International Group, and subsequent AIG bonuses only ignited more outrage.
With Americans struggling under a 10 percent unemployment rate, lost investments, and continued home foreclosures, lawmakers are cognizant of the controversy surrounding the bailouts and Bernanke.
The closest previous confirmation was in 1983 – also after a recession – during the re-nomination of Paul Vaulcker, who passed 84 to 16. For such confirmations, 60 votes are required.
Amidst frustration with the Fed, Bernanke has tried to protect the institution from calls by Treasury Secretary Timothy Geithner to eliminate its authority to extend credit to non-banks, as well as calls from lawmakers to hand some authorities to other institutions.
The Federal Reserve is responsible for setting interest rates, regulating banks, and lending in emergencies.
Bernanke was originally appointed by former President Bush.