BoE cultural revolution: staff blog and uncensored working papers

Today is a big day for the Bank of England.

A staff blog, ‘BankUnderground‘, with connotations of radicalism that will be tough to live up to.   And a relaunch of their working paper series, now emphasised to be a Staff Working Paper Series to mark the fact that these will not be censored for conformity with BoE policy lines.

Both of these seemed impossible even a few years ago, it being enough to suggest these things for one to be branded as naively failing to grasp the business risks, or the importance of cherishing continuity.

For those of us who scrambled over the wall to the outside world to escape the constraints the Bank imposed, it feels slightly disorientating to watch the BoE getting on with a revolution, and with scarcely more fuss than it organised the universal ‘One Bank’ screensaver.

I managed researchers who struggled with the task of self-censorship at the idea-formation stage.  I managed others who were more oblivious, and ended up careering with their mildly critical texts into the implacable opposition of the Press/Governor’s office.  And still others who had oblique technical papers about macro prudential policy blocked from appearing at an obscure conference by the current Chief Economist.  And, in a short stint in the Governor’s Office myself – lest you think my hands are entirely clean – I was responsible for pulping one working paper whose subversive vector autoregressive econometrics had somehow eluded the eyes thus far cast over it.

All changed.  Most of the old gamekeepers have left, and those that haven’t are now turned into poachers by Mark Carney’s different perspective on transparency and openness.

It’s early days, of course.  We will have to see whether, when there is something really at stake for the institution, these outlets reveal anything of substance about staff-policy-committee discord.   Or how the BoE manage work that appears to contradict not just its own views, but those of its HMT principals.  And Mr Carney has only 3/5 of his time left, so there is also a risk that he will be seen as the Gorbachev of Bank of England Sovietism.  A brief period of happy glasnost before the next regime closes in.

However, I am more optimistic.  Rather unscientifically, I conjecture that openness and transparency in Western institutions has a way of being hard to reverse.  And that this is also a reflection of a generational phenomenon.  It would be inconceivable today that the Bank’s internal performance criteria for young analysts include, as they did in the 1980s, ‘manner and bearing’.  Likewise, future generations will not believe that once upon a time the BoE working papers were so closely vetted that the disclaimer ‘these are not the views of the BoE nor the MPC…’ was a routine contradiction.