mr. bernanke, mr. bernanke and mr. pahlsson and mr.ner are credited with saving and stopping an economic collapse in 2008, and the world economy. >> and they did. and they did. no doubt about that. everybody agrees. >> charlie: exactly. >> touche. >> everybody agrees. >> charlie: did they all of a sudden become stupid? >> i would like to enter a demurrer on that point. >> nobody is perfect. >> right 50% of the time. >> to save the world once, what do you want to do? >> charlie: you think this is more -- >> why did -- a question for all of us is is why did the world need saving? the g.d.p. in this country, that is our national output, was down about 3%, 3.5%, from best to worst, peak to trough, and in response, or in combination with this perturbation in our national output, the financial system of this country virtually collapsed. why is that? it seems to me that the astounding and scandalous financial precariousness of this country is a direct consequence of our monetary arrangements. when there were a finite number of dollars tied to

mr. bernanke talks about qe2, that there's a lot of things they can still do. but he is also saying government should not cut fiscal stimulus at this juncture. which is completely different from what he said a year ago. >> reporter: president barack obama's decision to extend tax breaks of his predecessor, george bush, was generally welcomed by u.s. investors. but koo warns against being too optimistic about the impact on economic growth. >> the bush tax cut was in place many, many years ago, failed to prevent the recession that we're in now. so extending it doesn't mean we will just come out of the recession as a result. but it's still better than this uncertainty we had that this may not be renewed in the middle of this very weak economy. so that uncertainty's removed. now it is going to be renewed, at least for two more years. and that's not a bad news. as to whether or not that will actually create a kind of a self-sustaining growth, we don't know because american companies typically are very sensitive to final demand, and final demand, given the level of u

stimulate saving and investment to reward the savers and investors and we need to get away from what mr bernanke and all the rest are doing to us david what do you think about all this is i mean again is this a choice or is it just something that we have to accept we have to accept living smaller we have to accept living more modestly because we still have the demonstration effect out there we do remember the top one percent top three percent of society particularly in the united states will just continue to live lavishly and actually benefit from this crisis here this recession i mean can there be a social consensus and we should just be more modest i find that hard to believe. well i think i'm going to the first one to cite actual data which will be interesting so in two thousand and nine. that are reported and one of the things that. stuck out to me was they talked about this creed of thrift you know i think that's really interesting because i think that spending is still happening but the mindset is different you know when you when you make purchases that are more thrifty or more economical

mr. bernanke for that information. he said, senator, not going to give it to you.not going to make it public. well, on that day, i introduced legislation to make that information public. working with a number of members of the house and the senate, some strange bed fellows conservatives came together. we managed to get into the wall street reform bill, a disclosure provision, and just on december 1st, last week, that information was made public. and let me talk a little bit about what was in that informing made public by the fed. after years of stonewalling, the american people have learned the incredible, in jaw-dropping details, the fed's bailout of wall street and corporate america. not just wall street. this -- in my view, congress has to take an extensive look at all aspects of how the federal reserve functions and how we can make our financial institutions more responsive to the needs of ordinary americans and small businesses. now, what have we learned from the disclosure of december 1st this is based on an examination of over 21,000 separate federal reserve

mr. bernanke for that information. he said, "senator, noarntion not going to give it to you." not going to make it public. well, on that day, i introduced legislation to make that information public, working with a number of members of the house and senate, some strange bedfellows, various conservatives, progressives came together on this issue. we managed to get into the bill a disclosure provision. and just on december 1, last week, that information was made public. and let me talk a little bit about what was in that information made public by the fed. after years of stonewalling, the american people have learned the incredible in jaw-dropping details of the fed's multitrillion-dollar bailout of wall street and corporate america -- not just wall street. one of the things we learned. as a result of this disclosure, in my view -- and i'm going to get into what was in what we learned -- congress has got to take a very extensive look at all aspects of how the federal reserve functions and how we can make our financial institutions more responsive to the needs of ordinary america

mr. bernanke cannot solve our problems in this regard. only we can solve these problems for the american people. cutting spending should be the easy part. -- the easy part of our solution. we can document hundreds of billions of dollars a year that are either wasted, defrauded, or duplicative in the federal government. and i've given hundreds of speeches over the last six years outlining those things, whether it be the $5 billion the pentagon paid to contractors for performance bonuses when those contractors didn't meet the performance rirmtds to get the bonus -- requirements to get the bonus. or it is the $100 billion a year in medicaid and medicare fraud. those are facts. the fact that we pay three times as much for a motorized wheelchair than what it costs ... we haven't done anything to address those issues. it is not hard to cut spending. it is hard to get the will to have a plan that recognizes that we have to keep on keeping on until we get america out of this very dangerous time period that we're experiencing. we just learned that

mr. bernanke on saturday night that there was a 100% guarantee against inflation, history teaches otherwiselow said, but that can print money but not jobs. i do not lay all the blame solely at the feet of the federal reserve and then i did not come to harshly criticized -- criticize that institution or their well-intentioned efforts. the problem, i believe, but the fed began in 1977 when congress imposed a dual mandate to pursue price stability and maximum employment. too often, this conflicting mandate has caused long-term costs to the economy. q.e. 2 is an example of what happens when it mettles too much. i wonder returned the bed to its original single mandate, price stability. we joined a longstanding effort of congressman paul ryan in this effort. and we've been criticized by all the right people on this count. but we started the national conversation about the proper role of the fed. i want to take this opportunity to publicly comment paul ryan for his longstanding and lonely leadership on this issue. treasury secretary timothy geithner recently said the administration will oppose any

mr. bernanke on national television on sunday night that there was a 100% guarantee against inflation, historyeaches otherwise. as economists have said, the federal reserve cannot print money -- can print money but it doecannot print money. print jobs. the problem i believe with the better reserve began in 1977 when the congress imposed a dual mandate. too hot often does conflicting and it has pitted job gains against long-term costs to the economy. qe2 is an example of when the a reserve involves itself too much. in that effort we joined a long- standing efforts of congressman paul ryan, who you will hear from in just a few moments, and this effort. we have been criticized by all of the right people on this count, but we started a national conversation about the proper role of the federal reserve, and i want to take this opportunity to publicly commend congressman ryan for his lonely leadership on this issue. timothy geithner recently said the administration will oppose any effort to end a dual mandate, arguing it was very important to keep politics out of monetary policy. let me be clear on

mr. bernanke, and i had our run-ins. mr. greenspan, along with mr. rubin and others, were the chief proponents, larry summers in there, were the chief proponents of deregulation of financial institutions and mr. greenspan and i had more than a few arguments. but on october 15 of last year, alan greenspan, who admitted that his views on deregulation were wrong -- and i give the man courage for at least admitting that he was wrong. did a heck of a lot of damage but at least he had the courage to admit that he was wrong. he was quoted on bloomberg news as saying -- and i quote -- "if they're too big to fail, they're too big. in 1911, we broke up standard oil. so what happened? the individual parts became more valuable than the whole. maybe that's what we need to d do." alan greenspan. the architect of deregulation, citing the fact that in 1911, we broke up standard oil. so here you have greenspan, who helped cause this crisis, at least having the courage to understand that now is the time to begin breaking up these big financial institutions. heavy enor

mr. bernanke, and i had our run-ins. mr. greenspan, along with mr. rubin and others, were the chief proponents, larry summers in there, were the chief proponents of deregulation of financial institutions and mr. greenspan and i had more than a few arguments. but on october 15 of last year, alan greenspan, who admitted that his views on deregulation were wrong -- and i give the man courage for at least admitting that he was wrong. did a heck of a lot of damage but at least he had the courage to admit that he was wrong. he was quoted on bloomberg news as saying -- and i quote -- "if they're too big to fail, they're too big. in 1911, we broke up standard oil. so what happened? the individual parts became more valuable than the whole. maybe that's what we need to d do." alan greenspan. the architect of deregulation, citing the fact that in 1911, we broke up standard oil. so here you have greenspan, who helped cause this crisis, at least having the courage to understand that now is the time to begin breaking up these big financial institutions. heavy enor

mr. bernanke, i believe, was a significant factor in the bubble in housing. but mr. taylor was a republican witness. all three said don't raise taxes now in this economy. so it is owe fennive to me a bit to have my colleagues stand up -- so it is offensive to me in a bit to have my colleagues stand up in a demagogic way to say you are trying to give a tax benefit, a bonus to millionaires. i don't believe that's accurate. these three premier economists, two of them called by the democratic majority, said, don't raise taxes because there has -- senator alexander, do you think these economists were saying this because they want to help millionaires? or do you think they were making that opinion because they believe it would be best for the economy and help more americans who are out of work get work? mr. alexander: i am assuming the senator from barack obama still has the floor. -- the senator from alabama still has the floor. i agree with his answer. in answer to the question that -- the idea is that you don't raise taxes in the middle of an economic downturn. because

mr. geithner for secretary of treasury and voted to help lead the opposition against ben bernanke, once again become chairman of the fed, those are the right questions to ask. >> senator, thank you so much for your time. this is going to be a continuing story. i hope we have a chance to continue this conversation. as i said at the top, congratulations. your fortitude in pushing for this disclosure has done a huge, huge, huge public service. >> eliot, thank you very much. >>> coming up, we'll have a full assessment of the damage from the wikileaks dump. >>> it's getting worse, not better. i'm talking about partisanship in politics. it used to be there was some issues that partisan didn't touch like foreign policy, like the start treaty or even the fed and how it ran the economy. no more. today, even those issues driven by partisanship. >> joining us on constitution avenue is mark mckinnon, a republican political strategist who worked in the bush white house as well as for some democrats such as ann richards of texas. he has a radical idea about how to fix our political logjam. civility and com

mr. president, on the eighth day of november of this year, i along with senator hagan of north carolina, the senator from louisiana, sent a letter to chairman bernanke, chairman blair, mary shapiro at the f.c.c., mr. demarko at the federal housing agency and secretary donvan at h.u.d., asking them to look at the 941-b requirements at the todd -- of the dodd bill and asked them to complete their work through the amendment the three of us sponsored to create the exception for risk retention requirements by the definition of a qualified mortgage. and i rise today on one of the final days we're here together in congress to raise the importance of this issue, because the current fragile condition of the housing. pass the national reform bill. mr. president, rain a business for 22 years in residential housing in atlanta. during those 22 years the average default rate or -- or delinquent rate was 3% on all mortgages, foreclosures rates were less than 1 1/2. things have changed dramatically in the last few years because of sloppy underwriting, because of no credit, because of no documentation. and we've seen some unbelievable new numbers. according to the f

of all the things i do, we hear ben bernanke, say don't worry, we don't have inflation, it's not a problem. i know we do. gasoline, since mr$138 billion tax to consumers. here is what happens, they put out a number every month called the consumer price index. an index of goods and services that you buy. the basket. the problem is they leave out food and energy. energy is off to the races. food, corn, sugar, coffee, all making record highs. cotton, clothes we wear, 140 years of trading, the highest price ever traded this month. things we use are going up. >> gretchen: why? >> because of the dollar. we keep injecting more and more money into the system. they make it easier. they make more dollars chasing after the same amount of goods. that means people who buy and sell things with the u.s. dollar, they need to chase with more dollars. prices of goods go up. problem is, the only thing holding prices down on the consumer price index, the one we want to go up, housing. >> steve: no kidding. >> that could be a while. >> steve: thank you very much. >> brian: we'll watch your show tonight. >> i should wear a banker suit like that