Why Central Bank Independence Matters ... In India, the independence of the Reserve Bank of India (RBI) and its respected governor, Professor Raghuram Rajan, was recently perceived to be under threat when the Indian government proposed through its Ministry of Finance that its nominees should form the majority in a new, formal Monetary Policy Committee of the RBI. Domestic and international concern about what was seen as an attempt to subordinate the decision-making process of the Indian reserve bank to political interference quickly mounted. The matter was ultimately resolved with agreement on the establishment of a committee with equal representation from the RBI and the Indian government, but with the RBI governor to have a deciding vote in case of a deadlock. This ensures, of course, that the ultimate judgment on Indian monetary policy still rests with the country's reserve bank. –ThisDayLive

Dominant Social Theme: Central banks – just leave them alone to do their good.

Free-Market Analysis: This article, appearing in Nigeria's biggest newspaper, is by Professor Moghalu, a former Deputy Governor of the Central Bank of Nigeria.

When we read part of his bio, we were about to write that individuals in countries perceived as "developing" often are the most didactic when it comes to defending various Western institutions.

But then we came to this: "Professor Moghalu teaches International Business and Public Policy and is a Senior Fellow in the Council on Emerging Market Enterprises at The Fletcher School of Law and Diplomacy at Tufts University in Boston, USA."

So it is obvious that Mr. Moghalu has a broad array of international contacts. Within this context, one might expect a slightly less fulsome article, yes?

Example:

Every nation has what I like to call the "guardians of the flame". These are the institutions that give backbone to statehood because they are the instruments through which a nation-state assures its sovereignty, security, governance, and basic economic life.

The president or Head of Government, the parliament that makes the laws, the judiciary, the armed forces, the intelligence and security services, the police, and the central or reserve bank which issues and manages the legal tender currency, otherwise referred to as "fiat money" in economic jargon.

Although all institutions matter, the list of "the guardians", the indispensable and irreplaceable ones, is essentially a very short one. Since the global financial crisis of 2007/2008 and its aftermath, when central banks saved the global economy from complete collapse through strong, concerted though belated action, their profile as guardians in national and global economies has become even sharper.

Sorry, but after reading this we're almost tempted to ask whether the professor is on some sort of controlled substance. He really believes this stuff? Is Nigeria's president – formerly Goodluck Jonathan – a "guardian of the flame"? How about in the West ... Obama? Blair? Clinton? These are "illuminated ones"?

Even his peers are admitting to doubts about the system. And the mainstream media along with certain high profile financiers have begun to ask whether central banks can actually stimulate significant growth using Keynesian formulas. (See below for more.)

Keepers of the flame? He really believes that central bankers guard the holy of holies? That they are not subject to the same corruptions and temptations as other men?

The article is chock full of what we call memes. It is in our view a cascade of fatuity and ill-digested received "wisdom." Central banks "saved" the global economy? Accept this dubious statement ... then ask at this point – this very point! – was the global economy worth saving?

Moghalu is seemingly a Keynesian "Kool-Aid" drinker of the most stubborn kind. Reading this article is to enter into a kind of editorial black hole. Absolutely no light is shed. Not a single statement that we haven't read a thousand – ten thousand – times before. It is one long cliché.