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ECB opens citizens’ dialogue: having a say in monetary policy

“We want your input” – “You have the floor”: With such headings, the European Central Bank has now launched a process in which the citizens of the euro states are to be involved in reviewing the central bank’s strategy. “We want to listen and be open to the opinions, expectations and concerns of citizens,” said ECB President Christine Lagarde in a video to kick off.

The central bankers have on the Internet specially set up a page, where everyone can find out about the process and submit their opinion using a form. An unusual approach: there has not been so much public participation in the central bank in recent years.

This is obviously part of the new style that the new ECB President Christine Lagarde has brought as a successor to Mario Draghi. The central bank had to “listen more”, she had explained and had also received considerable support from Bundesbank President Jens Weidmann in this approach.

Role model America

The large amounts of data from the many e-mails from citizens now converge in a project office at the ECB. The main challenges are seen in the complexity of the project. After all, unlike in the United States, there are many different individual states with different languages, cultures and debates in the monetary union – just about the ECB and what is not going well there.

All of this should now be brought together and somehow taken into account. In the end, a report will then be compiled from the proposals, which will flow into the work of the Governing Council to realign the strategy. As a second element, events under the title “The ECB is listening” are planned in the 19 member states, which are organized by the respective national central banks. They should be based on the model of the American central bank under the title “Fed listens”. In America, too, it is not the case that citizens can have a say in these events, but they can make suggestions. In the United States, this type of approach appears to have worked well.

In Europe, the launch will be an event on March 26 in Brussels. The Bundesbank is supposed to organize such an event for Germany, but did not yet specify the exact date on Monday. However, not all people can simply come to these citizens’ events and, for example, use banners and chants to express their criticism of the ECB’s monetary policy. Rather, the guests are selected through associations and other organizations.

Representatives of employers and unions, consumer protection organizations and regional institutions, as well as associations such as Transparency International, should be present. In Germany there is also a conference “The ECB and Its Watchers”, which will take place in Frankfurt on March 24th, and which will also involve scientists, economists and lawyers in the process.

The conference is organized by the Frankfurt economics professor Volker Wieland, who is also a member of the Economic Expert Council. There, topics can be brought into the process that are more of a concern for the professional world; Recently, for example, the question was discussed as to whether the central bank should pursue a “point target” for inflation in the future, or rather an “inflation band” that gives it a little more leeway and follows from the knowledge that the central bank does not entirely inflate anyway can control exactly.

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