Since the crisis, central banks have taken a considerable place in the management of economies. Maybe too much, and this has the potential to undermine the political power, writes Paul Tucker, former deputy governor of the Bank of England (2009-2013), now at the Harvard Kennedy School, the school of public affairs from the american university. In her new book, Unelected Power. The Quest for Legitimacy in Central Banking and the Regulatory State (Power non-elected. The quest of legitimacy for the central banks and the State regulator, Princeton University Press, April 2018), it details why it is time, according to him, that the technocrats are in retreat.
The euro area renews with a fragile growth, after a difficult decade. What conclusions can you draw from the action of the european central Bank (ECB) ?
If we stick to the objective of maintaining the stability of the monetary system, it has done a good job. From a certain point of view, today it is much more than a central bank : the last decade, it has been the only institution capable of guaranteeing the survival of the euro zone, as the only one able to act in this direction during the crisis. This position is nevertheless precarious, as a result of the incompleteness of institutional of the monetary union.
Major central banks have greatly expanded their power and influence during the crisis. Why ?
Maybe because they had committed a few less errors than the other controllers during the previous time period. Or because at the beginning of the financial shock, they were better equipped to act quickly : the weapon budget is a bit longer to trigger. Consequently, they have taken centre stage in the face of political leaders, which are indented. If president Franklin Delano Roosevelt embodied the revival of the United States after the 1929 crisis, it is…