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Tide Turns in Bernanke’s Favor

An intense lobbying campaign this weekend by the White House of waffling Senators has turned the tide for Federal Reserve Chairman Ben Bernanke, whose confirmation to a second term now appears all but assured.

President Barack Obama stepped in to try to save Bernanke’s nomination after concerns began to mount in the Senate Democratic Conference over whether he deserved another four-year run at the Fed. Obama’s personal appeals appear to have worked: Over the weekend, several powerful Senators, including Majority Leader Harry Reid (D-Nev.), announced their support for his installment. Reid’s announcement seemed to prompt other Democrats to follow suit.

Meanwhile, Bernanke is continuing his own outreach to the Hill. He is set to meet with Majority Whip Dick Durbin (D-Ill.) on Monday afternoon. Durbin announced over the weekend he would vote for Bernanke, but not before reiterating the concerns of Democratic liberals who called for a Main Street-minded Fed chief and a more transparent central bank.

“As I meet with Chairman Bernanke before the vote, I will continue to demand that the Federal Reserve make a commitment to transparency and accountability in its policies,” Durbin warned in a statement Saturday in which he announced how he would vote on Bernanke.

Added Durbin: “And I will make it clear that if the Federal Reserve refuses to exercise its authority to demand bank reform and protect America’s consumers, I will join with members of Congress to push for new laws that achieve those goals.”

Opposition to Bernanke appeared to bubble up among Democratic liberals last week, with even moderates privately criticizing him for focusing too much on Wall Street concerns. And Democratic Senators are not changing their minds about the nomination. Sen. Jeff Merkley (D-Ore.) began circulating a “Dear Colleague” letter Monday to drum up opposition to Bernanke, while Sen. Bernie Sanders (I-Vt.), who caucuses with the Democrats, issued a press release titled “Four Reasons Why Democrats Should Oppose the Bernanke Reappointment.”

Republicans have largely stayed in the background as the Democrats do battle over the nomination. But Budget ranking member Judd Gregg (R-N.H.) has led a behind-the-scenes effort to rally GOP support, and he continued his campaign Saturday by issuing a rare joint statement with Banking, Housing and Urban Affairs Chairman Chris Dodd (D-Conn.). In a television appearance Monday, Gregg suggested there may have been “a bit of exaggeration” over the opposition to Bernanke’s installment and declared that the Fed chairman “always had a pretty solid vote on the Republican side of the aisle.”

Appointed in 2005 by President George W. Bush, Obama announced he would renominate Bernanke to a second term last year. Bernanke’s nomination is the subject of several holds, which means Reid will have to file a procedural motion to move ahead with his confirmation.

Bernanke’s current term expires on Jan. 31.

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