Policy

Organizations like the Fraser Institute are calling for the Bank of Canada to be given "arms-length" status from Parlaiment. The Bank already has a lot of independence, but the Minister of Finance can still more or less direct the governor of the Bank on general matters of policy. Under the arms-length principle, however, the Bank would be answerable only to its own mandate (as interpreted by its governor and members) rather than by elected officials. The reason offered for this change is that a central bank answerable to government would be too susceptible to the whims of popular opinion and pursue a loose monetary policy which produced inflation even as it sought to curry favour with thecitizens by appearing to give them more buying power.

That is to say, arms-length status would protect policy from politics.

Now, this line of thinking reveals some alarming assumptions about Canadians, (aside from the assumption that inflation is always bad) specifically:

which, in turn, casts real doubt on whether or not democracy should be allowed to interfere with the rational management of our economy and, hence, our society.

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