Obama to Keep Three Top Bush Appointees?

by Deb Cupples |   According to today's Washington Post, President-elect Barack Obama plans to keep -- for a while, anyway -- Federal Reserve Chairman Ben Bernanke, Chairman of the Joint Chiefs of Staff Michael Mullen, and FBI Director Robert Mueller.

I don't know enough to comment on Michael Mullen's or Robert Mueller's performance, but Ben Bernanke troubles me. 

Mr. Bernanke is one of the men who devised and lobbied the public for a $700 billion bailout package for financial institutions whose executives had driven their companies toward the cliff's edge. Worse yet, Bernanke wanted no strings attached to the bailout funds -- and look at what's happened so far.

Remember, the bailout was supposed to put money into lending institutions' coffers, so they'd start lending again (to businesses, people, and other banks) -- thereby, unfreezing our nation's credit markets.

As we learned just a couple weeks ago, some companies now receiving bailout funds are opting to not devote all the bailout funds to lending.  Instead, some of them will use the money to buy other banks, to give employees raises, and to give executives bonuses.

Who knows?  Maybe if Mr. Bernanke is working under the Obama Administration, he will perform much better than when he was working under the Bush Administration.  Anything's possible.

Other Buck Naked Politics Posts:

* Cutting Executive Pay Would Save Jobs

* Lehman Execs Redistribute Shareholder Wealth (to Themselves)

* AIG Execs Redistribute Shareholder Wealth (to Themselves)

* Execs Made Millions While Driving Companies into Ditch

* Are Bailout Funds Being Misused?

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Comments

[Charles]

Mueller and Mullen were not so concerned with wiretapping and torture that they took any significant career risks. Mueller may have even been a part of the Whitewater attack on Clinton (the article is in Salon, March 2002, by Josh Marshall). By contrast, even though I disagree with some of the implementation, Bernanke is an expert in the field of preventing deflation, and is acting according to the best practices. In any event, his decisions won't end up sending innocent men to be jailed, tortured or even killed.

[nitish]

i don't believe obama could get rid of bernanke even if he wanted to...
according to the fed site,
http://www.federalreserve.gov/aboutthefed/bios/board/bernanke.htm
he was sworn in on in 2006 to a 4 year term through 2010. and you know the fed is independent, blah blah blah...

how about SecDef robert gates continuing?

[Mark]

First - As nitish said, Bernanke can't be removed right away even if Obama wanted to. But given past precedent, I'd be shocked if Obama didn't renominate him in 2010.

Second - there's usually very little reason to replace the Chairman of the Joint Chiefs of Staff, just given the nature of the position.

Third - Mueller should go, if only to serve as a partial repudiation of Bush-era attacks on civil liberties.

[Mark]

First - As nitish said, Bernanke can't be removed right away even if Obama wanted to. But given past precedent, I'd be shocked if Obama didn't renominate him in 2010.

Second - there's usually very little reason to replace the Chairman of the Joint Chiefs of Staff, just given the nature of the position.

Third - Mueller should go, if only to serve as a partial repudiation of Bush-era attacks on civil liberties.

[Damozel]

Mullen's a good sort, I think. Mueller should go.

[Adam]

As nitish said, Obama CAN'T fire Bernanke. He's independent and gets to serve out his term. Obama can appoint someone new in 2010 if he wants to.

For what it's worth, I attribute the original, crappy bailout plan more to Paulson than Bernanke. This isn't surprising, because Bernanke's background is in academia, while Paulson went straight from Wall Street to the SecTreas office.

Actually, all three of the guys mentioned in this article are folks who, like the SEC chairman, have terms that carry past January. These are not people who would be replaced in a typical presidential transition. As I understand it, Obama will have the authority to fire Mullen or Mueller if he wants to, although it would be highly unusual to fire the head of the Joint Chiefs.

[Deb Cupples (Buck Naked Politics)]

Adam,

How are you?

You may be right about the Fed Chairman's term -- in which case, I don't see why the WaPo even bothered to mention Bernanke in the article.

As for blaming Paulson more than Bernanke, you may do that -- but your sense of the situation doesn't make it so.

I see them as having worked as a team on that particular project.

[Deb Cupples (Buck Naked Politics)]

Charles,

I'm disturbed by Bernanke's plan (with Paulson) to pass up to $700 billion to corporations (some of them run by pretty reckless people) without wanting strings attached to how the money would be spent.

I think it says something bad about Bernanke -- even if innocent people don't end up in jail because of the decision.

Unlike Adam, I simply don't believe that Bernanke is blameless for supporting such a plan or helping to sell it to Congress and the public.

[Deb Cupples (Buck Naked Politics)]

Nitsch,

I saw the fed Web page too (and thanks for posting it). It doesn't say anything about removing the Fed chairman.

You could be right, though. Obama may NOT be able to force Bernanke out. However, I suspect that he might be able to encourage him to leave -- if he wants to do so, which apparently Obama doesn't want to do.

I guess we'll see what happens.

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