WASHINGTON — For all the anger lawmakers have directed at the Federal Reserve Board this year, it was hardly evident when Chairman Ben Bernanke spent more than three hours before a House panel on Tuesday.

"I want you to know that even though we've been tough, I truly respect what you've done over the past few months," Rep. Jackie Speier, D-Calif., told Bernanke during his appearance before the House Financial Services Committee.

"Of all the testimony we hear in this committee, I always enjoy yours the most," Rep. Bill Posey, R-Fla., followed.

The generally positive reception Bernanke enjoyed could indicate moderating sentiment toward the Fed on Capitol Hill as the central bank launches an all-out defense this week to explain its controversial response to the financial crisis.

The Fed chief penned an editorial in Tuesday's Wall Street Journal trying to allay concerns that the central bank's response to the banking turmoil will leave it unprepared to fight inflation. He will continue to drive that message home in an appearance before the Senate Banking Committee today and he heads to Kansas City on Sunday to participate in a town hall meeting — a first for a sitting Fed chairman.

"It was a friendlier reception than usual," said Chris Low, the chief economist at First Horizon National Corp.'s FTN Financial. "Part of the reason his reception was so good was you could tell half the committee read the op-ed before he came into the room. As a result, a lot of the inflation fears were put to rest. … It made it a lot easier."

Still, lawmakers disagreed with Bernanke on key issues. Perhaps most important, House Financial Services Committee Chairman Barney Frank appeared to reject requests from Fed officials to explicitly designate consumer protection as one of the central bank's core missions. "One of the greatest unused examples of power were the consumer protection powers we've given the Fed like the Home Ownership and Equity Protection Act," he told reporters, referring to legislation that Congress gave the Fed to rein in mortgage lenders in 1994 but that went unused until last year.

In separate appearances before the House Financial Services monetary policy subcommittee in recent weeks, Donald Kohn, the Fed's vice chairman, and Elizabeth Duke, a governor, have argued Congress could tack on consumer protection to the central bank's "core mission," which already includes maximum employment and price stability.

Bernanke did not go quite so far Tuesday but made clear the Fed is reluctant to hand over consumer powers to a separate agency the Obama administration hopes to create. "If I were writing it, I would keep the consumer protection with the federal banking agencies, with additional measures to ensure a strong commitment," he said.

But Rep. Keith Ellison questioned whether the goals of bank regulation are at odds with consumer protection.

"You take the example of overdraft fees," he said. "A safety and soundness regulator would not be distressed about what I would say are excessive overdraft fees because it helps with profits and the safety and soundness of the bank."

Bernanke noted the Fed has written rules governing overdraft fees while simultaneously operating as a regulator.

He showed more flexibility on other provisions of the White House's plan for regulatory reform. A council that would be established to assist the Fed with managing systemic risk has been derided as powerless, but Bernanke said he is not opposed to giving the panel more authority.

"I'm very open to discussing the role of the council," he said. "An important role is to coordinate regulation to oversee risk. There may be situations where the council can have authority to harmonize certain practices or identify problems."

Rep. Ron Paul continued to stump for legislation he has introduced that would open more of the Fed's policymaking to review from the Government Accountability Office. The Texas Republican pressed Bernanke on claims that such oversight would infringe on the Fed's ability to conduct monetary policy independently.

"Since I wrote the bill, the interpretation has nothing to do with monetary policy," Paul told Bernanke. "There's nobody in Congress that's going to be auditing the Federal Open Market Committee."

Bernanke did not budge from his position.

"At some point, we're going to have to start raising interest rates to avoid inflation," he said. "If we were to raise interest rates and someone in Congress didn't like that and called for a review, wouldn't that be an interference?"

The Fed chief also rejected calls to return to the days when the Glass-Steagall Act enforced walls between commercial and investment banking. "I don't think Glass-Steagall, if it had been enforced, would have prevented this crisis," he said. "We saw plenty of circumstances where commercial banks on its own or an investment bank on its own ran into problems without cross-effects."

The hearing also gave lawmakers the chance to pepper Bernanke with questions on everything from health care to the budget and personal savings. But they virtually ignored one of the biggest problems for the Fed: its involvement in the merger of Bank of America Corp. and Merrill Lynch.

The House Oversight and Government Reform Committee has released dozens of sometimes embarrassing internal Fed e-mails regarding the transaction and has hauled Bernanke, former Treasury Secretary Henry Paulson and B of A Chief Executive Ken Lewis before the panel for three separate hearings.

Frank seemed puzzled by the inquiry. "As I studied all of this, here is my problem: I cannot find a villain," he said at the outset of the hearing. "Many of my colleagues have found a villain and it tends to be the private sector or the public sector, depending on the ideology of the finder."

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