I had a guest speaker in the entrepreneurship class the other day. He told his startup experience to the class and added one more observation to my collection of lives being disrupted by the financial crisis of 2008. My life was actually disrupted by that catastrophe as well. Luckily, all my observations turned out well after the crisis.
The financial crisis changed the world and we started to feel the aftermath, big and small.
In the macroeconomics literature, there was a time people talked about inflation targeting being the future of central banking. The underlying promise was that if the central banker was given only one task-inflation control in this case-she will do the juggling act better. One after another, countries adopted measures to ensure their central banks to be independent from political interference and do one fine job of controlling the inflation. Some put the central bank independence in their constitutions, while others tied central bankers' pay to the performance of inflation targeting.
No longer. The crisis changed that. Central banks are now tasked with plenty of conflicting goals: inflation control, economic growth, financial system stability, mortgage loan justice, and so on. Now Janet Yellen, the new Fed chief, even talks income inequality as threat number 1 to a central bank. Ridiculous.
We want an independent central banker. But we've never asked the question, "what if the independent central banker is as partisan as a politician?"