Federal Reserve Chairman Ben Bernanke and Treasury Secretary Timothy
Geithner will dominate financial news on Capitol Hill this week.
Most eyes will be on Bernanke, who will appear before the Senate Banking Committee on Thursday for a confirmation hearing for a second term as head of the central bank.
Lawmakers across Capitol Hill have been increasingly critical of the Fed throughout the year, even as they appear supportive of Bernanke in particular. The House Financial Services Committee, with Republican and Democrat support, voted to support a new audit of the Federal Reserve that would subject the bank to heightened scrutiny.
Rep. Ron Paul (R-Texas) has fought unsuccessfully for decades for additional oversight of the Fed, but he has gained much more support since the financial crisis raised questions about the Fed and its broad powers. Rep. Alan GraysonAlan Mark GraysonDeSantis tops Crist, Fried in poll of Florida governor race Florida Rep. Val Demings officially enters Senate race against Rubio Demings raises Democrats' hopes in uphill fight to defeat Rubio MORE (D-Fla.) joined Paul on the audit amendment, which passed over the objections of powerful Committee Chairman Rep. Barney Frank (D-Mass.).
Senate Banking Committee Chairman Chris Dodd (D-Conn.) has said he supports Bernanke’s confirmation, but the hearing will be closely watched as a way to judge Bernanke’s power and persuasion on Capitol Hill. The Fed is strongly opposed to the audit amendment.
Meanwhile, on Wednesday, Geithner will testify on the need for new curbs on the multi-trillion derivatives market. During his last hearing before lawmakers, Geithner was sharply criticized by House Republicans. Rep. Kevin BradyKevin Patrick BradyDemocratic retirements could make a tough midterm year even worse Yellen confident of minimum global corporate tax passage in Congress 136 countries agree to deal on global minimum tax MORE (R-Texas) called on Geithner to resign, which set off a fiery exchange in the hearing room.
Geithner has come under increasing pressure and criticism from Republicans and some liberal Democrats for his role in the bailout of American International Group (AIG) and amid a broader economy that continues to see unemployment rates increase.
The Senate Agriculture Committee is holding the hearing on derivatives, and lobbyists are watching for how chairwoman Sen. Blanch Lincoln (D-Ark.) aims to impose new restrictions.
Frank’s panel will also attempt to complete its markup of financial regulatory overhaul legislation this week. The committee had planned to vote on a wide-ranging bill on “systemic risk” two weeks ago, but lawmakers from the Congressional Black Caucus said they would withhold their votes.
Their efforts were unrelated to the underlying bill and concerned the broader state of the economy and its impact on African Americans, Frank’s spokesman said.
Frank has said Democratic leaders aim to hold a vote in the full House in the second or third week of December. But House leaders are also focused on new efforts to stimulate the economy and create jobs and have not committed publicly to when a vote on financial legislation will occur.