Congresswoman Maxine Waters, Ranking Member of the House Financial Services Committee, today welcomed the testimony of Ben Bernanke, Chairman of the Federal Reserve Board of Governors. Mr. Bernanke appears before the Committee today as required by the Humphrey-Hawkins Full Employment and Balanced Growth Act of 1978. The complete text of Ranking Member Waters’ opening statement follows.
I am very pleased to welcome Chairman Bernanke before the Committee to receive his report on the conduct of monetary policy and the state of the economy as required twice a year by the Humphrey-Hawkins Act.
I commend Chairman Bernanke for his leadership and bold efforts in cooperation with the Federal Open Market Committee (FOMC) to foster the conditions that stimulate lending, economic activity, and private sector job creation.
While some have expressed concerns about the potential risks involved in the Fed’s aggressive quantitative easing (QE) programs, I believe our central bank’s actions have provided critical support for our nation’s economic recovery. In fact, the Fed’s intervention may be one of the few actions protecting that recovery from some of my colleagues’ ongoing pursuit of retractionary fiscal policies.
As we sit here today, yet another manufactured fiscal crisis looms due to sequestration’s automatic spending cuts that are scheduled to take effect in just two days. And despite those who wish to downplay the impact of sequestration, the costs are real. The CBO estimates that 750,000 jobs are at stake in 2013; the Bipartisan Policy Center projects the loss of at least a million jobs over the next two years; and a recent George Mason University study put the number at 2.14 million jobs – over 950,000 of which would be attributable to losses by small businesses.
It is my hope that both Republicans and Democrats can come together to construct a more balanced approach to addressing the deficit while protecting our nation’s ongoing recovery from the worst financial crisis since the Great Depression.
With that in mind, I wanted to use this opportunity to note a GAO report released last month that outlined the enormous costs of the financial crisis to the U.S. economy. The GAO found that the financial crisis’ impact on economic output could be as much as $13 trillion and, in addition, the amount of home equity wealth lost by U.S. homeowners reached $9.1 trillion.
And this is precisely why I believe it is imperative that we fully implement the regulatory reforms within the Wall Street Reform Act in order to ensure that we never again experience a crisis like the one that occurred in 2008.
I look forward to the Chairman’s insight on all these matters, and in particular his perspective on how the automatic spending cuts scheduled to take effect this week will impact our nation’s recovery and economic growth.