Leadership contests at central banks might never have the excitement of a political race, although the renomination of Ben Bernanke as US Federal Reserve chairman is turning into something of a cliffhanger. But the contest to succeed Jean-Claude Trichet as president of the European Central Bank appears – so far at least – boringly conventional. There are just two possible candidates mentioned: Axel Weber, president of Germany’s Bundesbank, and Mario Draghi, his Italian counterpart. Or are there?
As the FT has reported, Mr Weber may be ahead at the moment but, thankfully, there is still a lot of time before a decision has to be made. Mr Trichet only stands down in November 2011. That would allow a thorough debate on what kind of president the ECB needs for the next decade – and for other candidates to emerge.
Mr Weber and Mr Draghi are seasoned actors on the international stage - the former has an academic background, the latter was vice-chairman of Goldman Sachs International – but might not be to everyone’s taste. An ECB president has to be capable of tough decisions while ensuring he has a strong consensus behind him within the 22-strong ECB governing council, which traditionally does not vote.
Mr Weber has firm (conservative) views, but not necessarily the alliance-building skills. Mr Draghi rarely speaks on monetary policy, despite his high profile role as chairman of the International Financial Stability Board – so appointing him ECB president would be a leap in the dark.
So, who else might be a candidate? The eurozone has a population of more than 300m so there should be plenty of choice. Here, for starters, are two of my suggestions:
First, Klaus Regling, the inscrutable former head of the European Commission’s economic and monetary affairs unit. Being German, he would have support in Berlin but he also intimately understands how the politics of the eurozone works.
Second, Miguel Fernández Ordóñez, Spain’s central bank governor. With its banks among the least affected by the financial market crisis, Spain has already offered the rest of the world lessons in regulation. But with the country’s economy badly hit by recession, Mr Ordóñez would also appreciate the difficult balancing act required in the years ahead to encourage a return to growth without creating fresh financial market bubbles.