Bernanke: 'Era of high living...is over now.'

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by Frank James

It was refreshing to see Federal Reserve Chairman Ben Bernanke do an on-the-record interview, breaking the central bank's tradition that the top official doesn't do interviews.

It's too bad it took the worst economic crisis since the Great Depression to force the issue.

(Fed chairs have been known to talk to reporters but in background sessions where you can't quote them or even let it be known you talked with them. Such sessions help journalists understand their thinking.)

Now that the world hasn't come to an end following such a media encounter, perhaps Bernanke and future Fed chief's will do more interviews. Not that we'll get much new information from them.

There wasn't any news in his interview with Scott Pelley of "60 Minutes" though we learned some things about Bernanke we didn't know before. For instance, he wore a poncho while he waited tables at South of the Border restarant to earn money for college.

Most of what he accomplished was that he put a human face on the central bank and sent the message: "I care," an especially strong message from Bernanke who hails from a fairly modest small-town South Carolina background.

And he helped push the message Washington's top policymakers want out there for public consumption that they're very angry at financial institutions' and Wall Street's top management and want them to voluntarily and publicly refrain from handing out huge pay packages -- AIG's bonuses being the latest -- that are making it very difficult to hold onto already waning public support for the financial bailouts.

An excerpt from the interview:

MR. PELLEY: I've been kicking around the country. I spoke to a woman in Ohio who took her son out of college because she got laid off. I spoke to a woman in Nevada who has an advanced stage of cancer, and she was told by her county hospital that they couldn't treat her because a hole had been blown in the state budget. What do you say to those people?

MR. BERNANKE: Well, I got into economics because I wanted to make things better for the average person. When I see a job loss number of 650,000 like we saw last month, I know that's not just a number, that's 650,000 lives that have been disrupted, families that have had to move or take children out of school, houses that may be in danger of foreclosure. I know something about what people are going through.

MR. PELLEY: And that makes it all the more outrageous when he hears of financial firms handing out perks and bonuses after they've taken bailout money.

MR. BERNANKE: The era of this high living, this is over now. They need to be responsible and use the money constructively.

MR. PELLEY: And you would say what to those bankers right now in this interview?

MR. BERNANKE: I'd say that their job right now is to find a way to make loans to credit-worthy borrowers, to get their banks back on the path of making good loans, safe loans and to have a reasonable sense of humility based on, you know, what's happened in the last 18 months.