Obama is a democrat and a former community organizer- making handling the U.S. and world economic crisis not something he had a ton of experience with. While critics questioned how well he would do with foreign policy on a regular basis, he was thrust into an even more challenging, difficult and currently drawn out recession that has made his presidency even more difficult. With recent race comments in the Gates arrest still smoldering, the environmental summit in Copenhagen coming up in a few months and Middle Eastern peace talks taking on a lot of hard line rhetoric, the one thing that he can point to right now that is going pretty well is the economic recovery. There are signs everywhere that everyone is pointing to that the recession is easing if not steadying or even turning around. For all the turmoil that continues around his health care reform and climate change legislation, the economic recovery package(s) seem to be working.

And in a large way, he owes a debt of gratitude to Federal Reserve chairman Ben Bernake, who he has nominated for a second term as chairman. Bernake was originally nominated by President George Bush for the spot, an has served in this role from 2005 through the present, one of the most tumultuous times in the history of the U.S. economy.

"Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and outside-the-box thinking that has helped put the brakes on our economic freefall," said Obama.
Bernake is an expert on the Great Depression and made use of much of his learning in crafting and making difficult decisions. His nomination for a second term by Obama shows trust and faith, and a healthy respect. Now, the U.S. senate must ratify the decision.

"The second four-year [term] of Bernanke [is] going to be defined as a success or failure on how he takes the money back, when he takes it back, and what happens when he does take it back," said New School economics professor Max Wolff.

Wolff is referring to the high amount of lending and money creation needed for Bernake’s policy’s. The The central bank now has $2 trillion dollars out in circulation, much of it due to bank loans. The amount doubled in the last year.

Wolff also pointed to the fact that handing out money to banks is the easy part and that Bernake will have a tough time wading through  the next few years, crafting even more policy and making decisions on how to get the money back, how to control possible inflation, and what to do about regulating the banking industry in the future.

From the middle, this is a great decision by Obama. The last thing the country would need right now is to nominate somebody new to be in charge of the economy. There would be some kind of initial rise because of excitement and confidence and then the second things weren’t on infinite growth mode again, people would freak out.

Cheers to both Obama, for making the decision to nominate Bernake again, and Bernake, for making the difficult decision first to stay and then to go for a second term. Impressive on both sides.