Outlook: ECB should publish and be damned

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The Independent Online
THE MINUTES of the Monetary Policy Committee may be a sanitised version of what actually happened, but they are presumably a reasonable semblance of the truth and always make fascinating reading. From the Bank of England's perspective, their greatest purpose is to lend credulity and accountability to its decision making, for almost invariably they show the committee to have acted in a thoroughly sensible and pragmatic manner.

This transparency is all the more important in present circumstances, with interest rates still high and growth declining, for it explains and justifies the policy stance. We may not agree with it, but at least we can see how the MPC is arriving at its decisions. The Bank of England gets a pretty rough press as things are, but without these minutes, it would be a good deal rougher and unforgiving.

Intriguingly, the minutes for September's meeting, published yesterday, reveals that one of the committee's previously most hawkish members, Willem Buiter, suddenly turned dovish and voted against the pack for a rate cut. To the extent that extremes of opinion exist at all on the MPC, Mr Buiter plainly has them. Only the previous month he had voted for a rise, again against the pack.

But his position isn't such a strange one really. Actually, it reflects a quite widely held view that things did change quite markedly in August. The new factors were the Russian crisis, the fall in equity values, and the worsening outlook for the international economy. What the minutes show is that at least there was someone on the committee prepared to adopt the intuitive, pre emptive, and it might be said, common sense approach to policy.

Unfortunately, none of these insights are going to be available to us when it comes to the ponderings of the European Central Bank. Wim Duisenberg, the president and on present form at least, a deeply unimpressive and complacent man, has already made plain that he won't be publishing minutes for many years, if ever.

This decision is only comprehensible set against the traditions of the Bundesbank, which has never published minutes, and the not unreasonable belief that ECB members will be more prone to represent national self interest if what they do and say is made public. By the same token, however, the ECB, by failing to explain itself, will be assured of more or less continuous national criticism.