Wednesday, 1 December 2010

Bank of England's independence threatened

Bank of England's independence threatened
Mervin King, Governor of the Bank of England, is under pressure to resign after WikiLeaks revealed he had less faith in David Cameron.
The WikiLeaks articles contained this document from a US ambassador : "He [Mr King] opined that party leader David Cameron and shadow chancellor George Osborne have not fully grasped the pressures they will face from different groups when attempting to cut spending," Since this has emerged Mr King has been pressured to resign.
Reports state that leading Economist David Blanch Flower states: Mr kings "thirst for power and influence ... has clouded his judgment one too many times".  That he should quit because of political bias.

Mervin King should not quit for exactly that reason!
He was reported to have concerns about the Government, this is merely his opinion. While Mr King may be using his influence surely he is entitled to an opinion.
If he is forced to resign for expressing some concern about the Government it will seriously question the independence of the Bank of England. If the Bank of England is a truly independent body then the Governor, while working closely with the Government, should be allowed to judgement. If every Governor that questions the Government is removed then surely we might as well take monetary policy back to 10 down street !

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