Bernanke Gets Annoyed with the Wall Street Journal

Ben Bernanke has taken to writing a blog. He’s probably a little surprised by how difficult it is to converse in this forum – especially when there is a lot of topical nuance.

That’s still no excuse, however, for making really weak arguments. The spat (and I think it’s safe to call it one) is between Mr. Bernanke and the Wall Street Journal (WSJ). The WSJ, in this editorial, is critical of Mr. Bernanke’s long standing stance on easy monetary policy. Mr. Bernanke, in this post, takes exception to the WSJ’s criticism.

I’m no apologist for the WSJ and (for purposes of this blog post) I am even indifferent to the substance of the argument both sides are making on this topic. My beef is with a few of Mr. Bernanke’s incredibly lacking assertions and his related rhetorical laziness. From an argumentative point of view – and what that argumentative competency (or lack thereof) says to me about Mr. Bernanke. 

1. The “we all got it wrong” defense (regarding being too optimistic on growth) is a pretty weak one on its face – and especially as a lead a key defensive point – that the Fed has also been too pessimistic on unemployment.

2. Nonetheless, Mr. Bernanke artfully collects credit for better than expected unemployment results – never mind that number of unemployed is a lot less impressive when the wages associated with that employment are considered. They have been incredibly measly by the way. I’m tempted to say “nice try”, but I really don’t mean that – because it wasn’t really.

There are some others, but in the interest of brevity, will skip straight to the blockbuster, which is:

3. Can you please, Mr. Bernanke, explain what it is you mean by “a well-structured program of public infrastructure development”? 

Do you mean more government spending using more borrowed money? Is your advocacy based on historical analysis which may not be as applicable in the current environment? Who exactly will be ensuring that it would be “well structured”? Are you sure those people are qualified to know?

Set aside the merits, the use of this phrase – with all of its vagueness – is lacking (putting it politely) – from an argument making point of view. 

I must say that the quality of this piece genuinely caught me off guard. I’ve never really paid a whole lot of attention to Mr. Bernanke – or the FOMC more broadly. It never struck me as all that relevant to the real world – and to the extent it was relevant it just feels like it shouldn’t be. Nevertheless, I definitely expected better.