Ron Paul, Alan Grayson Question if Bernanke Is 'Fit to Serve'

by Stephanie Condon

Two congressmen with opposing political viewpoints but similar populist streaks have joined together to ask the Senate to delay confirming Federal Reserve Chairman Ben Bernanke for a second term, questioning whether he is "fit to serve."

Representatives Ron Paul (R-Tex.) and Alan Grayson (D-Fla.) sent a letter Wednesday to Senate Banking Committee Chair Chris Dodd (D-Conn.) asking first for the release of documents "that will allow the public and the Senate to have a full understanding of the commitments that the Federal Reserve has made on our behalf," the letter says.

The letter excoriates the Fed for lending financial institutions immense sums of money against overvalued collateral, a lack of clear lending standards and setting up holding companies with no-bid contracts. The decline in real income, along with rising unemployment and falling consumer asset prices, "raises real questions about Bernanke's tenure as Federal Reserve chairman," the letter says.

"Even as the (economic) crisis is said to be subsiding," the congressmen wrote, "we still do not have credit markets that are able to function without substantial government support, we have not addressed institutions that are 'too big to fail' which the Fed oversees (and) bank availability is again shrinking."

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October 9, 2009

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