Canadian to run the Bank of England

Canadian to run the Bank of England

The paranoid will surely just chalk this up to the global Canadian bankers’ conspiracy:

Mark Carney has been named as the new governor of the Bank of England by Chancellor George Osborne.

Mr Carney, the governor of the Canadian central bank, will serve for five years and will hold new regulatory powers over banks.[…]

Mr Osborne told Parliament that Mr Carney, 47, would bring the "strong leadership and external experience the Bank needs" and added that the Canadian would apply for British citizenship.

The Washington Post’s Neil Irwin notes that Cameron’s willingness to look across the pond may signal tje relization that "being a central banker is a harder job in the post-crisis world than it ever was before, and to do it well calls on a mix of skills that few people on the planet possess." So what are Carney’s skills?

He led the Canadian economy through perhaps the best performance of the major Western nations during the crisis itself; there were no major failures of Canadian banks at a time when their international counterparts were falling like dominos, and the economic downturn in Canada was relatively mild. Carney  is chairman of the Financial Stability Board, a group of leading regulators and central bankers who aim to deal with financial risks.

Apart from his time as a central banker, Carney has also been a creature of the financial markets. He spent 13 years at Goldman Sachs. While he has a PhD in economics from Oxford, he never worked as an academic economist. (He does not have British citizenship, though he has deep ties to the country, including his years at Oxford and a British-born wife).

Even so, the idea of importing a foreigner to such a high-profile position is bound to raise some eyebrows. As former FPer Annie Lowrey perceptively tweeted, "Would the United States mind having a foreign citizen be its central banker? (My guess, though not a confident one, is yes.)"

On the other hand, as I noted in this explainer, British law is pretty open to citizens of the commonwealth taking high government positions. For instance, to be a member of parliament according to British law, you need only be "18 years of age, and a British citizen, or citizen of a Commonwealth country or the Republic of Ireland." To date, the only prime minister born outside the British isles was New Brunswick’s own Bonar Law.