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Rep. Wagner: Bernanke testimony “reaffirms” state of struggling economy

Ann Wagner

Ann Wagner

Rep. Ann Wagner (R-Mo.) expressed disappointment in response to recent testimony from Federal Reserve Chairman Ben Bernanke regarding the economy.

“With our economy contracting for the first time in four years and our national unemployment remaining stubbornly high, I was hoping Chairman Bernanke would bring us some good news today about the future of our country,” Wagner said. “Unfortunately, the Chairman’s testimony only reaffirms that our economy continues to remain stagnant despite the largest fiscal and monetary stimulus in our nation’s history. Since 2009, Washington Democrats have added about $6 trillion to our national debt, and the Federal Reserve has expanded its balance sheet to nearly $3 trillion. These extraordinary actions undertaken by the Federal Reserve in recent years significantly raise the risk of inflation or other problems down the road, and currently the Federal Reserve is pumping $85 billion a month into our economy in an attempt to keep interest rates low. But the Federal Reserve has not detailed specific plans on how they will unwind these positions without causing serious harm to the economy.”

Bernanke testified before the House Financial Services Committee last week, saying that low interest rates were necessary to ensure the continued recovery of the U.S. financial system.

“The economy will get stronger because of good policies, and that in turn will cause rates to rise in a sustainable way,” Bernanke said, according to Reuters. “If we were to raise rates prematurely we would kill the recovery and rates would come down, and we would have a long-term situation with very low rates.”

Bernanke also noted that long-term debt problems still remain a problem for the nation, while advocating  for a “less front-loaded set” of spending cuts.

“We’re never going to be able to buy an economic recovery, and the sooner Washington realizes this, the better off our economy will be,” Wagner said.