Bernanke: 'Communication Problem' On Crisis
A number of the members of the House Budget committee apparently are still feeling the heat from their constituents back home, because they're telling Fed Chairman Ben Bernanke that regular folks still don't get the "Why" of the various costly rescue/bailout plans.
"I understand a communication problem exists," Bernanke said, and re-emphasized he believes that the $700 billion Wall Street rescue/bailout plan will end up actually costing the taxpayer very little. He said it's an investment, not a handout.
"The public doesn't yet get that we could have had a collapse," said Rep. Brian Baird (D-Wash.). "What would have happened if we had not passed the bill?"
Baird was clearly trying to coax Bernanke to tell him something Baird could take back to nervous and angry Washington staters.
"We would have had a very severe financial crisis that would have resulted in the failure of major institutions and led to a very severe, protracted recession," Bernanke said.
Apparently, that was still too wonky for Baird.
"Translate that to the average guy," Baird said. "More lost jobs, lost farms, far more than now?"
Finally, Bernanke capitulated: "Absolutely," he said.
-- Frank Ahrens
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