If George Osborne’s “friends” were not advertising the former chancellor’s interest in the top job at the International Monetary Fund, would we even take the idea seriously? One suspects not. The UK has a strong candidate to push to be managing director of the IMF. He is Mark Carney, governor of the Bank of England.
Osborne’s claim seems to rest on the idea that the current editor of the Evening Standard is a skilful political animal who could attract votes from around the world, and thus find a way through the IMF board’s opaque selection process.
Well, OK, he’s European and a European always gets the gig according to the cosy convention that allows the US a free run at the top post at the World Bank. Osborne also ticks the box that says it’s finally time for a Briton at the IMF. As for the Brexit factor, it’s an obstacle to gaining the necessary support of the EU. The fan club, however, will say it is surmountable: the UK will still be a large economy and cannot be excluded permanently from the top table.
Christine Lagarde’s nomination to run the European Central Bank has prompted speculation over who could replace her as managing director of the International Monetary Fund.
The former French finance minister is set to become president of the ECB from 1 November, should she win approval from Brussels. Her move will spark a round of international horse-trading over who should lead the global lender of last resort.
Here are some names in the frame:
George Osborne
Editor, Evening Standard
Suggested his candidacy to friends. The former UK chancellor is regarded as the architect of austerity in Britain, once favoured by the IMF but now out of fashion. Brexit could damage the chance of a Briton winning support from other nations. However, Osborne has close ties with China and the US and was a backer of Lagarde.
Mark Carney
Governor, Bank of England
Canadian by birth, the Bank’s governor also has UK and Irish citizenship. Due to exit Threadneedle Street at the end of January, he has experience in international circles, having led the G20 Financial Stability Board. Highly regarded, he has moved to fight the climate crisis and his speeches chime well with the IMF’s outlook.
Mario Draghi
President, European Central Bank
The Italian economist could complete a job swap with Christine Lagarde when he leaves at the end of October. He was influential in preventing the breakup of the Eurozone. Aged 71, the IMF would need to change a rule that managing directors must be no older than 65.
Raghuram Rajan
Professor, Chicago Booth University
The former Indian central bank governor was previously chief economist at the IMF. Appointing him would prove symbolic: dismantling the tradition of a European leading the fund and recognising the rise of Asian economies. Rajan is also seen as a potential successor to Mark Carney at the Bank of England.
Agustín Carstens
General manager, Bank of International Settlements
The Mexican economist is well regarded in international circles for his work at BIS, the central bankers’ bank. The unwritten code that a European leads the IMF could stand in his way. The former finance minister and head of the Mexican central bank has ruled himself out to succeed Carney.
Kristalina Georgieva
Chief executive, World Bank
The Bulgarian economist was previously vice-president of the EU commission and currently runs the IMF’s twin institution, the World Bank, under its American president – David Malpass. A close connection to EU politics would help her candidacy. Richard Partington
And Osborne may think he can raise a cheer in Beijing since, in office, he was fond of giving speeches about “a golden decade” in UK-China trade relations, even to the point of funding our nuclear power stations with cash from the Chinese Communist party.
Come on, though, Osborne at the IMF sounds a stretch too far. The main problem isn’t the fact the IMF’s economists regularly objected to the austerity policies he pursued as chancellor. Among the chummy Davos brigade, ideological clashes can usually be quietly forgotten. Rather, the main issue is simple: Carney is just a bigger figure on the global stage.
The governor has headed two central banks – the other being the Bank of Canada – and was chairman of the Financial Stability Board, the body that has done serious work behind the scenes in clearing up the mess of the 2008-09 crash. On the climate crisis, an area where the IMF is more vocal, you’ll find more serious thinking in Carney’s recent speeches than in any of Osborne’s budgets.
The governor’s CV will be more attractive to other EU nations, without whose support no London-backed candidate will get far. Carney can also wave Canadian, Irish and British passports, which covers several bases. We don’t know if he is interested in the job but, if he is, he could easily win the contest. Osborne looks an extremely long shot.
What’s got into the water at Ofwat?
The regulator has recently told four water companies – including Thames, Anglian and Yorkshire – to sit in detention until they can do their homework properly. The company’s first submissions of its business plans for 2020-25 period were deemed inadequate, and now the re-jigged versions have also failed. The firms have been given a fortnight to do better.
Has Labour’s nationalisation agenda provoked a tougher approach on the part of a regulator that has rightly been accused of timidity in the past? Actually, no, it would be wrong to read too much into this tale. The simple explanation is probably correct: the four laggards are just less efficient than their rivals and deserve a good kick.
Remember that the three stock market companies – Severn Trent, United Utilities and South West Water, which is owned by Pennon – all scored top marks for their business plans at the first attempt. Ofwat says the others have “not yet risen to the challenge”.
This is roughly the way the regulatory system is supposed to work: in the interest of keeping bills down, inefficient firms have to catch up with the leaders. The losers in the process would probably love to blame their woes on the idea the regulator has become politicised. They should look in the mirror.
William Hill employees are dealt a bad hand
The bookmakers says it could close 700 high-street shops, putting 4,500 jobs under threat. Across the industry, a quarter of premises could close. William Hill will blame the cut in maximum stakes on fixed-odds betting terminals from £100 per spin to £2 and, on a short-term perspective, it would be right. The machines used to generate half the income in the shops.
On a long-term view, though, this day was always coming. The machines had been clearly become a social blight and the bookies, even when evidence of harm piled up, did too little to reform themselves. Change is terrible for low-paid employees, but it had to happen.
