Ben Bernanke is taking no chances. With his confirmation hearing for continuation as chairman of the Federal Reserve System only days away, he has written an op-ed for publication in Sunday’s Washington Post. We may interpret this article as a preemptive attack on his congressional critics, some of whom will no doubt take the opportunity afforded by next Thursday’s hearing to attack his management of the Fed and, indeed, the Fed itself.

Monetary-policy propaganda is a high art, and lay readers of Bernanke’s article may well be taken in by its artful formulation. Therefore, as a public service, I offer the following brief commentary, interweaved with CNN’s Saturday report on Bernanke’s Sunday op-ed.

NEW YORK (CNNMoney.com) — Federal Reserve Chairman Ben Bernanke, just days ahead of his confirmation hearing, is warning Congress that actions limiting the central bank’s independence could prove detrimental to the causes of financial reform and economic recovery.

Such a warning seizes the high ground by creating the presumption that Bernanke and the present Fed have proved themselves to be beneficial to the causes of financial reform and economic recovery. In the circumstances, that’s a highly questionable presumption. Some of us are inclined to believe that, all in all, the Fed and its glorious leaders, especially Alan Greenspan and Ben Bernanke, got us into our present troubles in the first place and that they have done nothing wise of late to repair the damage they brought on us, acting instead to create enormous risks for our future well-being and, in particular, great risks for the future purchasing power of the U.S. dollar.

In an op-ed piece to be published in Sunday’s Washington Post, Bernanke criticizes two moves aimed at limiting the Fed — a proposal in the Senate to strip the central bank of its bank regulatory powers and a House Financial Services Committee vote to audit monetary policy deliberations and actions.

“These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States,” Bernanke wrote.

I suppose he is referring to the same sort of consensus that Al Gore likes to cite in regard to global warming. We know now, better than ever, that such consensus may well be manufactured by interested parties. I wonder, for example, whether anyone has ever checked to see how many monetary economists have previously enjoyed a grant, a salary, or some other perk from the Fed, or currently do so, or reasonably expect to do so someday.

And about this “economic and financial stability in the United States” that a Fed audit would threaten: Is Bernanke thinking about the stability we enjoyed between the world wars, when the Fed managed to bring about the onset on what proved to be the greatest depression in world history (an accomplishment for which he has previously accepted responsibility on behalf of the Fed)? Or perhaps he is thinking instead about the stability we enjoyed since 2001, when the Fed pushed the Fed funds rate quickly from 6.5 percent to 1 percent, held it at a negative real rate for several years, then pushed it up quickly to 5.25 percent in 2006-2007, then shoved it down quickly to almost zero in the past year? Zounds. It would certainly be tragic if the American people had to give up such remarkable stability. Or perhaps he is thinking about the fact that before the Fed was created, the dollar had retained its purchasing power more or less constant for more than a century, except for transitory war-related ups and downs, but since the Fed’s creation, the dollar has lost more than 95 percent of its purchasing power. Who calls this degree of debasement stability? Yes, it’s more stable than Zimbabwe’s currency. Bravo, Fed: you’ve yet to generate hyperinflation. But you may still do so before the present mess is completely washed away.

Let’s get serious. If the Fed is known for anything historically, it is for first pushing the monetary accelerator to the floor, then stomping on the monetary brake. To praise this outfit for its contribution to financial and economic stability is akin to praising Josef Stalin for his commitment to human rights.

Bernanke says the congressional moves are a byproduct of the public frustration over the financial crisis and the government’s response, especially the bailout of large banks. (Fed rage boils on Capitol Hill)

Odd that people would be upset, eh? Just because many of us have had our dreams of retirement destroyed and our very survival menaced by these monetary rulers of the universe. We need to take a more balanced view: even if you and I have been nearly wiped out, the kingpins at Goldman Sachs and Bank of America are doing very well. People who bought credit default swaps from AIG got their money, didn’t they (actually our money, but that’s only a detail)? So all in all, the country is in pretty good shape, on the average.

“The government’s actions to avoid financial collapse last fall — as distasteful and unfair as some undoubtedly were — were unfortunately necessary to prevent a global economic catastrophe that could have rivaled the Great Depression in length and severity, with profound consequences for our economy and society,” he wrote.

Yes, it is distasteful when we little folks have to take a financial beating so that the rich and well-connected can flourish; we do tend to get a bitter taste in our mouths. But, then, we certainly don’t want another Great Depression, do we? But wait a minute. How does Bernanke know that if, say, the government and the Fed had not taken the slew of outrageous measures they have taken in the past fifteen months, another Great Depression would have occurred? I have a Ph.D. in economics, same as Bernanke, and I’ve been a professional economic historian of the United States for more than forty years, and I don’t know this thing he claims to know. Does he have a pipeline to God? (A more reasonable hypothesis is that he is God’s agent on earth, put here to punish us for our sins.) This constant reference to an impending Great Depression makes for excellent politics of fear, but where’s the theoretical and historical meat? My best guess is that had the government refrained from all of its extraordinary interventions of the past year or so, the worst of the adjustments would already have been made, and a genuine recovery would now be in progress. Instead, thanks to Bernanke and Co., we may never see a flourishing economy in this country again. Argentina and other countries have been ruined by a great deal less meddling.

But the Fed chairman says that, while reforms are needed, “we should be seeking to preserve, not degrade, the institution’s ability to foster financial stability and to promote economic recovery without inflation.”

Ditto my earlier comments on stability.

Among the ideas he supports is development of a special bankruptcy procedure for firms “whose disorderly failure would threaten the integrity of the financial system — to ensure that ad hoc interventions of the type we were forced to use last fall never happen again.”

Note the language: “Interventions of the type we were forced to use last fall.” Two questions: who is this “we,” and who “forced” these actors to do what they did? From my perspective, these actions look like the work of a handful of people with very close connections to the titans of Wall Street who had got their asses in a wringer by making foolish bets – well, in retrospect, not foolish, perhaps, making due allowance for the “Greenspan put,” which allowed them to assume (correctly, it turns out) that if they got their asses in a wringer, the Fed (and, in a really bad situation, the Treasury) would bail them out and, all things considered, they would still come waltzing out of the devastation (for other people) smelling of roses.

Bernanke’s column comes ahead of a Senate Banking Committee hearing, scheduled for Thursday, considering his nomination for a second term as Fed chairman. President Obama announced the nomination in August.

The last sentence of his commentary is likely to be the theme he and his supporters will stress during the hearing.

“Now more than ever, America needs a strong, nonpolitical and independent central bank with the tools to promote financial stability and to help steer our economy to recovery without inflation,” Bernanke wrote. 

Strong, yes. Nonpolitical – don’t make me  laugh myself to death! Independent? Of you and me, to be sure, but not independent of Goldman, B of A, JPMorgan Chase, and the other old boys up there in the big city. This unholy alliance wants us to lie back and take the punishment they dish out when their salvation requires our sacrifice. If the congress members at the hearing on Thursday have any sense and backbone, they will not take this crap lying down. But that’s a mighty big if.

With the Climategate revelations, momentum is definitely building against the credibility of the climate doomsday mongering, but will it be enough to derail the juggernaut for global warming statism? As the Wall Street Journal has noted in its November 27th editorial, “Rigging a Climate ‘Consensus'”:

The furor over these documents is not about tone, colloquialisms or whether climatologists are nice people. The real issue is what the messages say about the way the much-ballyhooed scientific consensus on global warming was arrived at, and how a single view of warming and its causes is being enforced. The impression left … is that the climate-tracking game has been rigged from the start.

Because of these revelations, the now scandal-ridden Climatic Research Unit at the University of East Anglia has suddenly reversed their long-standing stonewalling and refusal to comply with requests via the U.K.’s Freedom of Information Act and now will release their “full data.” Meanwhile, in a new report in the Times of London, we now find that, “Scientists at the University of East Anglia (UEA) have admitted throwing away much of the raw temperature data on which their predictions of global warming are based.” In addition, the New Zealand government’s National Institute of Water and Atmospheric Research has similarly been “cooking the books.”

But perhaps of even greater importance is whether these revelations will finally bring to light the need for a serious re-assessment of the actual operations of academia and scientific enterprise. For far too long, “science” has been shrouded in a cloak of unquestionable authority as the final arbiter of all knowledge. Such a status has resulted in the creation of enormous, government-funded institutions to examine seemingly every aspect of human existence, with climate science receiving a whopping $7 billion annually from the U.S. government alone (more than is spent on cancer and AIDS research). The conclusions from such endeavors have been viewed by many as utterly sacrosanct, around which public policy and the law itself should allegedly be based.

In the process, this dogmatic commitment to “science” and a government-science complex as the source of all higher truth has produced a narrow-minded worship of scientific materialism, the reductionist fallacy of “scientism.” Almost daily for example, media reports claim that “in the name of science” yet another enduring human characteristic has now been “explained” away—from free will to love, from moral conscience to reason, from education to the arts, from commerce to law—in purely deterministic terms, with government power the requisite means to address social problems by redesigning and controlling mankind.

And the mania regarding “global warming” is exhibit A, in which the alleged “peer-reviewed” findings of a “consensus” of scientists claims to have found the “fact” that human emissions of CO2 are creating an ecological holocaust, and only draconian controls on all areas of human life will avert this calamity. In the process, ethics, economic principles, contrary evidence, and common sense are all swept aside in a mad rush for climate statism.

But with the revelations from Climategate, many people are now beginning to see a grand scam, in which data is deliberately distorted; peer review is gamed by manipulating and stacking the process; critics are smeared, black-balled, and de-funded; opposing papers are kept from publication; and a cabal of politically-connected scientists are working in concert with certain journalists, politicians, bureaucrats, and interest groups to deceive the public and opinion leaders in order to ram through a politically-correct agenda. Of course, we have seen such campaigns many times before, all claiming to be based on expert findings in the natural and social “sciences,” including eugenics, the creation of the Federal Reserve, zero population growth, the New Deal, ozone depletion, electro-magnetism and cancer, economic bailouts, Superfund, the war in Iraq, and even Obamacare.

The reality that has been missed here is that science is merely a technique or procedure for examining the material world, and the validity of such a technique rests upon a prior philosophical (metaphysical) logic of ideas, that is all necessarily non-material. Moreover, while science can tell us what is materially, it cannot tell us what ought our choices to be with such conditions. Hence, science, while being an irreplaceable contributing method of inquiry, is contingent and cannot itself be the final authority on truth. By missing this point and succumbing to the worship of scientism, much of academia and the scientific world has too often corrupted and politicized the enterprise of science, producing its exact opposite.

More than six decades ago, C.S. Lewis prophetically warned us of this very same corruption of science and morality in his brilliant novel, That Hideous Strength, in which a group of university scientists conspires to take over society by manipulating information and people in order to impose the horror of a scientistic, totalitarian state, all to “save” nature and create a new “mankind.” Lewis simultaneously examined these central issues in his classic book on epistemology and ethics, The Abolition of Man.

For further prescient assessments of this serious problem and the need for accountable, de-socializing solutions, please see the following:

“Peer Review and Scientific Consensus,” by Robert Higgs (Nature Magazine, September 17, 2007)

“Peer Review, Publication in Top Journals, Scientific Consensus, and So Forth,” by Robert Higgs (History News Network, May 7, 2007)

“Groupthink in Academia: Majoritarian Departmental Politics and the Professional Pyramid,” by Daniel B. Klein and Charlotta Stern (The Independent Review, Spring 2009)

“Government and Science: A Dangerous Liaison?”, by William N. Butos and Thomas J. McQuade (The Independent Review, Fall 2006)

“Facts, Values, and the Burden of Proof,” by Peter Lewin (The Independent Review, Spring 2007)

“Institutional Review Board Mission Creep: The Common Rule, Social Science, and the Nanny State,” by Ronald F. White (The Independent Review, Spring 2007)

“Science as a Market Process,” by Allan M. Walstad (The Independent Review, Summer 2002)

The Academy in Crisis: The Political Economy of Higher Education, edited by John W. Sommer (1995)

The Independent Institute was also among the very first and few organizations to debunk the erroneous claims of man-made climate crises, starting ten years ago with such publications as the following:

Hot Talk, Cold Science: Global Warming’s Unfinished Debate, by S. Fred Singer (1999)

“After Kyoto: A Global Scramble for Advantage,” by Bruce Yandle (The Independent Review, Summer 1999)

A Poverty of Reason: Sustainable Development and Economic Growth, by Wilfred Beckerman (2002)

New Perspectives in Climate Change: What the EPA Isn’t Telling Us, by S. Fred Singer, John R. Christy, Robert E. Davis, David R. Legates, and Wendy M. Novicoff (2003)

“Is There a Basis for Global Warming Alarm?”, by Richard S. Lindzen (Yale Center for the Study of Globalization)

Re-Thinking Green: Alternatives to Environmental Bureaucracy, edited by Robert Higgs and Carl P. Close (2005)

“Should We Have Acted Thirty Years Ago to Prevent Climate Change?”, by Randall G. Holcombe (The Independent Review, Fall 2006)

Finally, the following Institute video is especially timely and incisive:

States of Fear: Science or Politics?, featuring the late Michael Crichton and a panel of distinguished scientists, including Bruce Ames (University of California, Berkeley), Sallie Baliunas (Harvard Smithsonian Center for Astrophysics), William Gray (Colorado State University), and Oregon State Climatologist George Taylor

In a tragic piece of irony:

When five defendants are brought before a New York federal judge to face charges for the terror attacks of Sept. 11, 2001, the first question may be whether some of them are competent to stand trial at all.

Military lawyers for Ramzi Binalshibh, an accused organizer of the 9/11 plot, and Mustafa al-Hawsawi, the conspiracy’s alleged paymaster, say their clients have mental disorders that make them unfit for trial, likely caused or exacerbated by years of harsh confinement in Central Intelligence Agency custody.

See here.

The ClimateGate emails exposing leading global warming activist scientists’ efforts to game the peer review system of scientific journals to suppress findings contrary to those serving their own interests makes one wonder whether Nature Magazine’s publishing Robert Higgs’s commentary regarding the vulnerability of the peer review system might not have been a proverbial cry for help from one seeing what was happening, and hoping for salvation.

As the recession has deepened and the rate of unemployment has risen, a number of commentators have sought, for various reasons, to portray the situation as far graver than the “official” rate of unemployment indicates. Some of these commentators charge that the government is deliberately misrepresenting the amount of unemployment and that the “real” rate of unemployment is much greater than the official rate that the government announces and the news media report each month.

I have no desire to claim that the government never hides bad news—indeed, the extent of its blatant lies and outrageous propaganda ought to have provoked public outrage a long time ago—but in the present instance, I believe the critics are the ones who are misrepresenting the situation. If the government is hiding the bad news about unemployment that the critics are courageously “revealing,” it is hiding that bad news in plain sight. Since 1940, the Bureau of Labor Statistics has provided a variety of information on the population’s employment status derived from the Current Population Survey, a rather complicated, stratified random sample of  approximately 60,000 households conducted each month. A BLS website explains how the data are collected. From these data, various measures of the rate of unemployment may be, and routinely are, computed. Again, a BLS website lays out these measures for all the world to see, and it makes available the component figures for anyone who wishes to compute a differently defined rate.

Thus, in October 2009, the most recently reported month, the rate designated U-3, which is defined as “total unemployed, as a percent of the civilian labor force (official unemployment rate),” stood at 10.2 percent. The persons classified as unemployed in this measure, the most commonly reported one, are basically those who are not currently working but who have made an attempt to find a job in the past four weeks. By adding other categories of persons to those regarded as unemployed in the U-3 measure, one may arrive at greater rates.

The broadest such measure, designated U-6, is defined as “total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers.” This rate stood at 17.5 percent in October 2009. A note attached to the BLS table of unemployment rates explains: “Marginally attached workers are persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not looking currently for a job. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule.”

One does not need to devote a lifetime to studying how these statistics are defined and measured to realize that in many ways they tend to overstate how dire the unemployment situation really is. For example, the persons classified as in the labor force but currently unemployed must have actively sought a job during the past four weeks, but a wide variety of actions qualifies as evidence that they have actively sought a job, including: (1) “contacting:  an employer directly or having a job interview; a public or private employment agency; friends or relatives; a school or university employment center”; (2) “sending out resumes or filling out applications”; (3) “placing or answering advertisements”; (4)”checking union or professional registers”; and (5) “some other means of active job search.” So, if you are out of work and tell the CPS data collector that three weeks ago you asked Uncle Charlie whether he knew of any job openings, then you qualify as officially unemployed, even though you made no other effort to find employment. Many of those classified as “marginally attached workers” and included in the U-6 measure are even more questionable. After all, they admit that they are neither working nor doing anything to find work. Merely saying that “they want and are available for a job and have looked for work sometime in the recent past,” though not in the past four weeks, does not evince much genuine interest in employment.

Strange to say, many commentators have insisted, from the very onset of the current recession, that we are plunging into a second Great Depression. Perhaps we are, but the evidence to date does not confirm such a plunge. Yes, by taking an extremely loose view of what constitutes unemployment, we can say that perhaps one worker in six is now out of work. But in 1933, the official rate of unemployment was nearly 25 percent, and perhaps another 25 percent of the labor force comprised persons working part-time who wanted to work full-time, so the U-6 rate at that time (long before the requisite data for such an estimate were routinely collected) was in the neighborhood of 50 percent—and that at a time when workers’ earnings and assets were much less than they are now and hence long spells without work correspondingly more frightening. Small wonder if a typical scene from the early 1930s shows dejected workers standing on the sidewalk in a soup line, whereas the typical queue nowadays is more likely to show cheerful customers waiting to be seated in an upscale restaurant. The year 2009 may not be the best of years, but it’s miles away from 1933.

[One of my fellow bloggers at NASblog.org, Alex Berezow, posted a lengthy post on how the Obama Left is just a change in fashion when it comes to science policy: “Right-wing anti-science policies are out; left-wing anti-science policies are in,” Berezow writes. Read the abridged version of his post below.]

Alex Berezow is a Ph.D. candidate in microbiology at the University of Washington.

Remember when President Obama said that he was going to “restore science to its rightful place”?  Apparently, that statement needed to be translated from the vagaries of “hope and change” to modern English:  Right-wing anti-science policies are out; left-wing anti-science policies are in.

For starters, President Obama appointed Cass Sunstein as the head of the White House Office of Information and Regulatory Affairs.  Mr. Sunstein believes that all recreational hunting should be banned.  He also believes that meat consumption should be phased out in the United States, and he holds the unique belief that animals should have the right to sue humans in court.  Naturally, the animal would be represented by a human lawyer—a policy other than that would just be silly.  But who exactly would represent the animals in court is unclear at this point.  Dr. Doolittle might be available, though.

All satire aside, with someone this disconnected from reality working in the White House, one wonders what impact he could have on the ability of scientists to conduct biomedical animal research.

Also, remember Mr. Obama’s obsession with creating green technology jobs as a way of leading us out of the recession?  According to a report described by George Will in his Washington Post column, Spain’s massive subsidization of renewable energy has cost that country 110,000 jobs.  Far from helping Spain’s economic crisis, this foolish subsidization appears to have contributed to its mind-blowing 19.3% unemployment rate.

As if this weren’t bad enough, a fantastic op/ed by Joel Frezza brought up several more examples of “junk science” coming from the White House, a few of which I’ll summarize and expand upon.

Mr. Frezza describes how the Obama Administration is asking for areas of Alaska to be deemed “critical habitat” for polar bears.  This move could severely limit the ability to drill for oil and gas in the region, in a time when our nation is in desperate need of energy sources.  It appears that, once again, Mr. Obama has caved to propaganda-spewing environmentalists who have ignored recent evidence indicating that polar bear populations are increasing.  In fact, polar bear researcher Mitch Taylor claims that of the 19 populations of polar bears, only two have exhibited declining numbers.  As a side issue, it’s also interesting to note that people like Captain Planet (Al Gore) who refer to polar bears as “endangered” don’t even have their facts straight:  Polar bears are officially listed as “vulnerable”—an entirely different conservation status.  This status is given to animals which may become endangered if conditions don’t change.  Arguably, however, conditions are changing because their population has been increasing.

Finally, Mr. Frezza points out the economically ludicrous and scientifically unsound subsidization of biofuels.  Liberals see the subsidization of biofuels as killing two birds with one stone:  Fixing the planet and helping out America’s farmers.  However, science has something entirely different to say about biofuels.  The production of biofuels emits nitrous oxide, otherwise known as laughing gas.  The planet, unfortunately, doesn’t find it very funny, since nitrous oxide is a much more potent contributor to the greenhouse effect than is carbon dioxide.  As The Economist points out in this article, a policy meant to make things better is merely an expensive way of making things worse.

Honestly, this list could go on and on.  What is so infuriating is the fact that Mr. Obama self-righteously proclaimed to be the protector of science, when the truth is that he simply replaced Mr. Bush’s special interests with his own.  In what has to be the most stunning broken promise in Mr. Obama’s presidency, instead of “restoring science,” he has simply resorted to “politics as usual.”