International Challenges and Perspectives
Edited by Jeffrey A. Raffel, Peter Leisink and Anthony E. Middlebrooks
Chapter 4: Leading Central Banking in Europe
Martin Marcussen FROM BUDDIES TO MANAGERS It is not so long ago that central bankers cultivated an image of mysticism by actively invoking the sacred aura of their institution. When newly employed personnel entered the US Federal Reserve Building, they were expected to abide by the confidential fraternity of that institution. They were ‘taking the veil,’ an expression that describes nuns entering a convent (Greider 1987, p. 54). In Germany, it was the same. The Bundesbank was reputed for its very effective socialization mechanisms ensuring that newcomers rapidly internalized the procedures and cultures of the institution. Bundesbank insiders referred to this phenomenon as ‘the Becket effect’ drawing ‘on the saga of Henry II’s chancellor, Thomas à Becket, who opposed the King after he was made Archbishop of Canterbury – and was murdered for his pains’ (Marsh 1992, p. 22). This helps to explain the development of a very strong sense of community within the Bundesbank. The Federal Reserve’s decision-making process has been described as the modern equivalent of mysterious sanctification. The Fed ‘enfolded itself in the same protective trappings that adorned the temple – secrecy, mystique, an awesome authority that was neither visible nor legible to mere mortals. Like the temple, the Fed did not answer to the people, it spoke for them. Its decrees were cast in a mysterious language people could not understand, but its voice, they knew, was powerful and important’ (Greider 1987, p. 240). In a similar vein, and borrowing a concept from William Ouchi (1980), Bundesbank governors...
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