Bank of England: Interest Rate Policy
Debate between Lord Desai and Baroness Penn(1 year, 5 months ago)
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Lord Desai (CB)
My Lords, would the Minister not agree that, although independence of the Bank of England is all right, what we need is competence? The Bank of England was more competent when it was not independent than it is now when it is.
Baroness Penn (Con)
Much as noble Lords continue to ask me to comment on the conduct of monetary policy by the Bank of England, as I said, the Government do not comment on the conduct or effectiveness of monetary policy. We continue to support the MPC as it takes action, and we focus on making the tough decisions necessary to tackle inflation.
Health Protection (Coronavirus) (Restrictions) (England) (No. 4) Regulations 2020
Debate between Lord Desai and Baroness Penn(4 years, 1 month ago)
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Lord Desai (Lab)
My Lords, it is a pleasure to follow the noble Baroness, Lady Altmann, who is an economist and a friend from the LSE. In the 30 years I have been in your Lordships’ House, I have never had the luxury of six regret amendments from the Government Benches themselves—so we can have the luxury of supporting the Government for a while. Let them quarrel among themselves.
As an economist, I used to be very humble in the face of natural scientists. I used to think that their models were solidly based on theory, experiment and science, and that we economists were just doing things and quarrelling with each other. I have to admit that I was in the econometric modelling business—my God—60 years ago and did the first computer simulation of an econometric model for my PhD. But let us leave all that behind.
I am embarrassed that what we call science has made a complete fool of itself in front of all of us. Epidemiologists, virologists and people who claim to have done several computer simulation models have not come to a single agreement. They have not got a model of what causes the infection or how it spreads. They have not given us any solid clue as to the rate at which the infection spreads—the R number. Is that number valid for a whole nation or only for a locality? What is the technical basis of the R number? How can we have a national lockdown with the goal of reducing the R number to below 1 across the nation, with no errors? Is this serious science? Do the Government have any critical ability they can borrow from somewhere else to judge what they are hitching us to do for the next month, if nothing better turns up?
I will make two points I have raised before. Is our aim to reduce the rate of infection or the rate of mortality? There is a difference. Look at America, where everybody says that Trump made a mess and there are a lot of infections. The rate of mortality as a proportion of infection is the same in America as here. The economic outcome in America for the third quarter of this year is a plus 33% growth in GDP: a real bounce-back from the recession—a genuinely V-shaped recession—while we are floundering around. As the noble Lord, Lord Forsyth, who is very knowledgeable on this matter, pointed out—