On Dec 5, 2007 3:08 PM, michael a. lebowitz <[EMAIL PROTECTED]> wrote: > At 03:17 PM 05/12/2007, raghu wrote: > > >Some I think are very bad > >ideas e.g. ending the autonomy of the central bank. It may be one > >thing to introduce some accountability but making the CB too much > >political cannot be a good thing. > > you prefer the neo-liberal rule of finance capital?
Of course not. I just think that any good constitution must have safeguards against the possibility that an awful leader may get elected someday. Also an autonomous CB is a good thing. The key is to ensure genuine autonomy - unlike the US Fed Reserve which is autonomous from elected politicians but controlled by Wall St puppeteers. There is a strong case to be made for an autonomous CB run by qualified technocrats preferably academics with a good system of accountability to elected authorities. > The main battle in vzla with the CB was whether the bank served > the needs of the economy as defined by the elected government > [eg., with excess reserves not building up but being used to create > new industries, etc] or whether it followed 'sound finance'--- you know, > all that stuff about fight inflation as the first responsibility, etc. I think there is a legitimate concern here. Sure some CBs go too far with their inflation fighting but it'd be equally unwise to completely disregard inflation. There has to be a balance. Would you trust a CB under political control to practice good monetary policy in an election year? -raghu.
