Bernanke Urges Congress To Take Action

Washington, DC, July 18, 2012 -- Federal Reserve Chairman Ben Bernanke urged Congress to take action to avoid the so-called fiscal cliff at the end of the year.

Bernanke noted in testimony Tuesday that a recession would occur, and 1.25 million fewer jobs would be created in 2013 without resolution to the budget impasse, echoing the Congressional Budget Office's warning.

The Fed is prepared to take further action to try to help the economy if unemployment stays high, he said, but wasn't specific.

Without congressional action, cuts in taxes on income, dividends and capital gains would expire, as would this year's Social Security tax cut and businesses tax reductions.

A host of program would also be cut, taking more money out of the economy. And emergency benefits for the long-term unemployed would run out.

"Congress is in charge here, not the Federal Reserve," he said.