Tester spells out economy concerns to Bernanke

Senator wanted Fed Chairman to hear Montana farmer's perspective

(WASHINGTON, D.C.) – Senator Jon Tester put a few of his biggest concerns about the U.S. economy on the table today during a meeting with the country's foremost authority on monetary policy.

Tester shared concerns about student loans, commodity and fuel prices, and housing during a breakfast meeting with Federal Reserve Chairman Ben Bernanke.

"Montana's working families are feeling squeezed by serious problems in the national economy," said Tester, a member of the Senate Banking Committee, which oversees the Federal Reserve Board.  "As he works on broad policy matters, I wanted Chairman Bernanke to hear the perspective of a Montana farmer about the issues that hit regular folks right in the wallet."

Tester specifically told Bernanke his concerns about:

  • The future of student loans in Montana: Tester told Bernanke to make sure money is available to meet the demand for student loans.  Many student loans are financed by bonds which must be traded on Wall Street.  Investors have recently shied away from buying bonds, which could result in higher interest rates.  Rising college costs put the dream of higher education out of reach of increasing numbers of students.
  • Commodities and inflation: Tester, a Montana farmer, told Bernanke how the rising cost of "inputs" such as fuel, fertilizer, equipment and land, will affect American agriculture.  When commodity prices fall, input prices usually stay high, hurting farmers.
  • Fuel prices: Tester expressed serious concerns over $3 gasoline and $4 diesel and how fuel prices will affect Montana's small businesses, tourism and agriculture industries.
  • Housing: Tester told Bernanke about how the ongoing mortgage crisis is affecting Montana—especially in growing areas like Gallatin and Flathead counties.  He also asked Bernanke about what legislation might be needed to counteract predatory and deceptive lending.

Tester also followed up on his recent questions about the Fed's bailout of Bear Stearns, a Wall Street investment bank.  The Federal Reserve Board and the U.S. Treasury agreed to risk nearly $30 billion to sell the bank to rival JP Morgan Chase.

Last week Tester asked the Department of Justice to investigate possible trading that may have triggered Bear Stearns' collapse.  Tester and Bernanke agreed to work together to formulate sound economic policies for broad-based economic growth and prosperity.