President Wants Bernanke to Keep Federal Reserve Role

President Barack Obama has issued an early renomination to keep Federal Reserve Chairman Ben Bernanke in his job.

Taking time out of his vacation schedule in Massachusetts, Obama announced his intention to have Bernanke remain as a key figure in U.S. financial regulation, though his first term isn't set to expire until the end of the year. The president credited Bernanke with "out-of-the box thinking that has helped put the brakes on our economic freefall."

This decision potentially puts Bernanke at the helm of future regulation of systemic risk, if current financial reform proposals become law. That would mean he'd have more direct influence over major financial companies, though whether the companies would include insurers hasn't yet been fully defined. New powers would add to what has already been a sharp increase in the central bank's authority during its confrontation with the U.S. economic crisis.

Obama, who mentioned Bernanke's past as a Great Depression expert at Princeton University, said Bernanke's fitness for the job was bolstered by "his background, his temperament, his courage and his creativity." Bernanke, 55, had originally been an appointee of President George W. Bush in 2006, succeeding Alan Greenspan.

Bernanke, whose recent comments about the outlook for U.S. economic recovery have been upbeat, stood beside Obama during the announcement. He said he would work "to the utmost of my abilities" -- if he wins a confirmation from the Senate -- to "help provide a solid foundation for growth and prosperity."

Sen. Chris Dodd, D-Conn, chairman of the Senate's Banking, Housing and Urban Affairs Committee that will be reviewing the nomination, said in a statement that he had "serious differences with the Federal Reserve over the past few years." But, he said, "I think reappointing Chairman Bernanke is probably the right choice. Chairman Bernanke was too slow to act during the early stages of the foreclosure crisis, but he ultimately demonstrated effective leadership, and his reappointment sends the right signal to the markets." Dodd promised a "thorough and comprehensive confirmation hearing."

Among Bernanke's goals for the second term will be limiting the potential for inflation and helping reverse national unemployment trends -- which have seen routine monthly declines in the insurance sector. Insurance and its related businesses have lost 55,700 jobs in the last 12 months, according to the U.S. Bureau of Labor Statistics.