Social Security Privatization Causes Tussle Between Dodd, Bernanke (VIDEO)

A highlight of Tuesday's hearing with Federal Reserve Chairman Ben Bernanke was a 27-second exchange with Chris Dodd, chairman of the Senate Banking Committee, over privatizing Social Security.

Dodd asks, somewhat rhetorically, "Did I sense a breath, a sigh of relief that we didn't privatize Social Security?"

Bernanke at first refuses to concede the point, responding, "Well we never got that far in that proposal, chairman... I'm going to have to get back to the details..."

After being pushed, however, the Fed chair admits that if Social Security had been tied to the stock market "that would certainly be a problem."

The exchange followed a hullabaloo earlier this week over a New York Times story reporting that President Obama had considered announcing the formation of a Social Security task force during his "fiscal responsibility summit" on Monday. According to the paper, "several Democrats said that idea had been shelved, partly because of objections from House and Senate leaders."

At Monday's press briefing, Press Secretary Robert Gibbs avoided directly responding to the story. Instead, he answered repeated questions on the veracity of the story with comments such as:

"I think you will be able to see, both in what the President says on Tuesday and ultimately what is forwarded to Congress on Thursday, will demonstrate clearly the President's intention and desire to see our country return to a path of fiscal responsibility, and in doing so, through honest budgeting, making very tough decisions that the American people understand we have to make, and cutting this deficit in half by the end of his first term."

To a direct question as to whether he was disputing the story, Gibbs responded:

"Well, let me -- can you read back the -- [laughter.] Let me go back and look through. But regardless of what you call it, Chuck, the President is committed to dealing with the rising costs of retirement security and health security in this country."

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