WASHINGTON Jan 9 Federal Reserve Chairman Ben
Bernanke on Thursday offered an optimistic view on the U.S.
economy's prospects to Democratic senators, but warned that
"tough decisions" were ahead on dealing with long-term budget
deficits and healthcare costs, according to lawmakers present.
Bernanke, whose term as chairman ends on Jan. 31, told a
private lunchtime meeting with senators that the reduction in
federal budget deficits and the country's improving energy
position were "all positives" contributing to a healthier U.S.
economy, according to Senator Thomas Carper of Delaware.
Carper added that Bernanke said that "the next several years
are more encouraging but we can't forget those long-term
challenges and they involve among other things programs that are
concerned with healthcare."
An aging U.S. population will put increasing pressure on the
federal government as it struggles to provide retirement and
healthcare benefits to the elderly, poor and disabled.
Bernanke did not speak to reporters upon leaving the
meeting. Fed Vice Chair Janet Yellen was confirmed by the Senate
on Monday to succeed Bernanke at the helm of the central bank.
Senate Budget Committee head Patty Murray said Bernanke was
"very astute, talking about how things are looking up and some
of the things we need to be doing investing in infrastructure
and research that will help our economy in the future."
Senator Charles Schumer emerged from the session declaring
to reporters that the Fed chief "thinks over the next four or
five years the deficit is in very good control but he's much
more worried about middle-class incomes and growth of average
families than he is about the deficit."
President Barack Obama and his fellow Democrats in Congress
are focusing their 2014 political message on the need to narrow
the income gap between rich and poor.
Schumer, the Senate's third-ranking Democrat and a senior
member of the Senate Banking Committee, said Bernanke also
discussed the issue of financial institutions that are deemed
"too big to fail."
Asked how Bernanke addressed that issue, Schumer said: "One
of the ways is to have market forces deal with the ability of
closing banks when they're in trouble and he talked about how
the credit rating agencies, realizing that the government might
not come in and bail out these institutions anymore, have
actually lowered their credit ratings, which is a market force."