CITY AND SUBURBAN
All this sitcom needs is a guest appearance by the grand old Duke of York
CHRISTOPHER FILDES
It is time that the Duke of York was recalled to the colours. He is all that the Not the Ken and Eddie Show now needs, apart from a less cumbersome title. This is a monthly sitcom, set in the Bank of Eng- land's parlours. Can Eddie George keep up his magical balancing act? Will the cast remain stuck on the fence? Book now for 7 May and find out. As a way to set interest rates, this is certainly interesting. The previ- ous show (as you may recall) was devised by Ken Clarke: the Governor proposed, the Chancellor decided, the minutes were pub- lished and the markets passed judgment. On its own terms, this worked well enough, but Gordon Brown thought it undignified. Decisions of principle, he complained, were being personalised. His new, dignified method would leave interest rates to the Bank. They would be set by a special com- mittee with four outside members, accept- able to him. They would, so I thought, be selected to keep the Bank's own hard-liners in order. Wrong. Eddie George has been for holding rates down, three of the four outsiders want to put them up, the Bank's economic director has bolted the ticket and joined them, and the committee's last two or three meetings have split down the mid- dle, deciding to do nothing by the Gover- nor's casting vote. Each marginal voter is now under scrutiny. What happens when the Bank brings in a new economist, when Professor Goodhart's sheep turn and bite the hand that feeds them, when Sir Alan Budd has a bad beard day? Who called Governor Eddie irrational? So much for taking the personalities out. This rift is between the economists, who can see infla- tion looming and want to pre-empt it, and the market managers, who want to smooth things over. They resist the idea of hoisting rates up and then hauling them down. This, though, is where the grand old Duke reports for duty.
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