Western Illinois University econ professor William J. Polley notes this exchange from the Bernanke hearings last night:
Sen. Sarbanes held up a chart showing how our unemployement rate is so much lower than Europe’s…and of course he reminded us that the European Central Bank has an inflation target. Mr. Bernanke’s response: “Senator, it was below that rate 20 years ago before the ECB was even created. I believe there are other factors that contribute to that difference.”
Bernanke was too polite to expound on those factors — i.e., policies that Sarbanes has spent his political career fighting for.