Obama and the Congress love Bernanke because he makes their lives very easy.  Obama can’t run his huge deficits without Bernanke.  Congress doesn’t have to cut spending with Bernanke.  Obama wants desperately to keep Bernanke around in order to run his socialized health care system.  All of the deficit spending is possible because unlike Paul Volker, Ben Bernanke is letting Obama and Congress off the hook by monetizing all the debt.

Politicians hated Paul Volker because he raised interest rates to over 20% during his chairmanship.  They all wanted him to resign because they could no longer run deficits that they thought they needed to get re-elected.  Alan Greenspan, often heralded as the greatest Fed chairman ever, lowered interest rates to 1%, effectively monetizing debt through the expansion of the money supply via wide open credit from the Fed.  Ben Bernanke is doing the same thing – delaying the inevitable economic pain and suffering – by lowering interest rates to a staggering all time low of 0%.  Of course Obama and the Congress love Bernanke! They can continue to spend, spend, spend, with no short term consequences.  The consequences are delayed and transferred to our children, who will inherit the debt and won’t be able to repay it.

See Peter Schiff’s great video below.

“You don’t drive an economy by consuming – the consumer is not the engine, the consumer is the caboose.”

“Minimum Wage Goes up—The only way to increase wages is to increase worker productivity. Wages cannot be raised simply by government mandate.”

“If wages could be raised simply by government mandate, we could set the minimum wage at $100 per hour and solve all problems.”

Great stuff.  Follow Peter Schiff on Twitter, and support Peter Schiff for Senate.

Peter Schiff for Senate 2010