Thursday, August 27, 2020

On conflicts of interest

Just a couple of weeks ago, there was a flurry of speculation - and disapprobation - about the possibility that Mark Carney might pursue a political career after having been governor of the Bank of Canada and Bank of England.

And that criticism seemed somewhat overblown. While central bank independence is taken as an article of faith, there's no indication that Carney's past actions would have been affected at all by the potential for future political involvement. And the case for encouraging people with substantial knowledge and no current conflicts of interest to be able to participate in our democratic system to them seems stronger to me than the case for an effective lifetime ban on serving as a representative based on a past role in central banking.

But now, Carney appears set to wear two different hats instead: as a closely-connected advisor to the Prime Minister tasked with developing the government's economic plan, and as an employee of an investment firm which stands to rake in profits from artificially-privatized infrastructure.

Needless to say, that should represent a far more direct and worrisome conflict of interest than the prospect of retroactive influence on past regulatory actions. And it's telling that there's so much less outcry over a conflict pointed toward using public funds to enrich the capital-owning class, rather than one which would have resulted in accountability to the electorate. 

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