Credit: Bank of England

Mark Carney isn't impressed with Jeremy Corbyn's plans for the Bank of England

The Bank of England governor warned 'People's Quantitative Easing' could end up hurting the poor.

by Rachel Savage
Last Updated: 22 Oct 2015

Bank of England governor Mark Carney is unconvinced by Jeremy Corbyn’s ideas for the central bank, which include taking away its independence and forcing it to print money to fund large infrastructure projects. Not surprising really, but it won’t make the new Labour leader’s job of convincing the public he’d be good for the economy any easier.

‘The issue would be imperilling potentially the achievement of price stability.  The consequence of that of course would be inflationary,’ Carney said, according to the Telegraph, when asked what would happen if Corbyn’s plans were to become reality at a Treasury Select Committee hearing in the Houses of Parliament on Wednesday.

‘The people who tend to get hurt the most by inflation are the poor, the elderly, those that can’t hedge themselves,’ he continued. ‘That’s been the experience throughout history and I’m sure that will be the experience in the future if the Bank of England were not to conduct policy not consistent with achieving its mandate from parliament.’

Given that one of Corbyn’s key selling points is his determination to alleviate poverty, that’s got to hurt.

The veteran left-winger, who hasn’t had much of a honeymoon since his landslide leadership victory, in no small part because of his appointment of hard left ally John McDonnell as shadow chancellor, also sought to dispel the confusion over whether Labour would support staying in the EU or not in the upcoming referendum.

But confusion still reigned. Corbyn, who voted for the UK to leave the EU when we last voted on it in 1975, said he didn’t see any circumstances where Labour would campaign to leave the single market. However, he didn’t comprehensively rule it out either – awkward, given shadow foreign minister Hilary Benn had said on Monday morning Labour would support EU membership ‘in all circumstances’.

‘We are having discussions to sort this question out,’ he told the BBC, in an interview last night that finally broke his media silence. ‘I want to see a social Europe, a cohesive Europe, a coherent Europe, not a free market Europe.’

Like many on the left, Corbyn is suspicious of the EU as a ‘neoliberal’ project. And he doesn’t want to give the prime minister a blank canvas in his renegotiation of the UK’s membership. ‘What I remain opposed to is the idea that David Cameron could go around and give up workers’ rights, give up environmental protection, give up a whole load of things that are very important,’ he said.

Under the fated leadership of Ed Miliband, unconditional support for staying in the EU had been a central plank of Labour’s attempt to distract business, which largely supports staying in the single market, from policies like energy price controls. It also meant they could point and laugh at the Tories tearing themselves apart yet again over Europe and UKIP. Under Corbyn they no longer have that luxury.

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