The Bank of England and conservative sound money politics: economic ideas in a contested political sphere

Abstract Over the course of the 2010s, Conservative politicians criticised the Bank of England for meddling in markets and punishing ‘prudent’ savers. Partly in response to this, Bank officials risked their own reputations by adopting new forms of communicative engagement with the public and attempting to defend the prevailing consensus on monetary policy. This paper draws on both qualitative coding of transcripts of Treasury Committee hearings and 11 interviews with Bank staff and officials to support its central claim that the politics of monetary policy takes place in a conflictual political sphere in which different interests, values and identities are mobilised in opposed ideologies of monetary governance. This qualitative approach helps to identify the ideological substance of public debates about monetary policy. The conflict between Conservative sound money and Bank monetary policy orthodoxy is conceptualised as a divide within the neoliberal consensus, with more progressive views marginalised or absent. Central bankers do not merely seek to publicly defend their reputations, while relegating the politics of economic ideas to abstruse debates among technocrats. Rather, central bankers are political actors in a relatively open, public and conflictual political sphere.