Ever since the Bank of England gained independence and was put in charge of interest rates 15 years ago, its Governors have attracted increasing media interest – and none more so than the current holder of that great office, Mark Carney. His appearance on Thursday on the Today programme’s 8.10am slot (probably the most high profile interview in British broadcasting) has been looked at with particular interest.
This was his first major interview since taking the job. There has also been greater interest because of his recently announced policy of ‘forward guidance’ on interest rates. Add to that the questions in the last few weeks about the strength and nature of the recovery and it’s clear that a lot was riding on this interview.
The fact that, even after it was dissected by the Sunday papers, there were no major headlines shows how successful he was in managing his messages and giving the kind of ‘steady as she goes’ performance which is most appropriate under the circumstances. Even the Daily Mail gave the Governor its blessing when it published pictures of him “chillaxing” at the Wilderness festival in Oxfordshire with his wife.
Let’s look at the interview in detail:
1 min 15 sec Presenter Evan Davis starts by asking a simple direct question about the Bank’s inflation rate target. Carney responds with an equally simple and clear answer. “Without question, Evan, the two per cent inflation target remains the primary objective of the Bank of England.” If only politicians and business leaders could be so clear and direct. If they are, they can then ‘bridge’ across to some of the other key messages that they want to get across. The important point is that they have answered the question.
2 min 31 sec “We’re not binding our successors [on setting interest rates],” says Carney in response to a question from Davis. Normally we would advise interviewees never to repeat a negative phrase from a journalist as it serves to emphasise the negative or unhelpful concept in the mind of the audience and makes it easy for press journalists to quote. However, this point about ‘binding successors’ is not necessarily a negative and repeating it helps Carney to reject it forcefully. Again, he uses simple clear language.
3 min 20 sec Still nagging away on the same subject, Davis asks what would have happened if the MPC had decided that the current policy is now wrong and wanted to change its mind. Journalists love the “What if…?” question but getting drawn into this kind of speculation is risky for any interviewee. In Mark Carney’s case it could make a headline – and not a very useful one. The Bank Governor very sensibly avoids agreeing with this and bridges away from it.
4 min 8 sec There’s another invitation here to create a headline when Davis quotes former MPC member Danny Blanchflower who has talked about the Bank’s policy representing the ‘decimation of the inflation hawks.’ Here again, Carney is clear and direct. “Absolutely not,” he says, avoiding another difficult headline.
4 min 30 sec This is a key moment in the interview. Carney might still be in his honeymoon period but he’s clearly aware that those working in the world of finance are not flavour of the month even now among the public. “We have to have some humility,” he says of the forward guidance policy. He then goes on to talk about the Bank’s models of the economy but he puts them into context and avoids sounding like a smug technocrat.
5 min 35 sec Here he develops his theme of humility and emphasises the importance of the real economy – a very significant message for him. “In the end what’s going to guide policy is not forecasts, is not guesses, is not estimations - it’s what happens on the ground and we’re providing as much certainty about that because we’re pointing to the employment rate as a condition and these are real jobs and real people and it’s reported on every month.” Using that tried and tested rhetorical device, the power of three, at this point Carney is now talking to ordinary people for whom issues such as money supply and models of the economy are largely irrelevant. Instead, he refers to jobs and the real world.
5 min 57 sec Davis goes on to raise the predicament of savers. Carney replies: “We have tremendous sympathy for savers. They’ve done the right thing - they set aside money and they’re now earning a lower rate of interest than they would have when they first put [that] money aside. But the best way to get interest rates back to normal is to have a strong economy.” There’s a different audience here but again Carney is simple and direct and ticks the ‘What’s In It for me?’ box that every key message should address.
6 min 38 sec “I first lived in this country in 1980s and in Japan,” says Carney. Personal experience almost always provides a powerful argument and is very difficult to disagree with. In particular Carney’s reference to living in the UK helps associate him with his British audience.
9 min 05 sec Referring to the state of the banks Evan Davis invites the Governor to either sympathise with them or, on the contrary, to endorse the public’s negative view of them. Carney very sensibly does neither but instead talks about the ‘cultural issue’ of the way some banks have behaved. “There has to be a change in the culture in these institutions and it’s something I’ve spoken about in Canada,” he says. This was the headline in some reports of the interview – and it’s not a bad one at all for the Governor.
“You sympathise with the public,” says Davis before asking another question. Journalists will often summarise the view of the interviewee. We advise people to be careful here and to make sure that the summary is accurate. If it doesn’t represent your views then you should challenge it and put a correct summary in its place. Should Carney challenge this? Either way, he doesn’t. However, he does go on to point out that banks must focus on what he calls ‘the real economy’, with a repetition of another positive message.
10 min 15 sec Davis mentions Carney’s time at Goldman Sachs and makes a comment about ‘God’s work’, a reference to former CEO Lloyd Blankfein’s highly controversial claim that bankers do ‘God’s work’. It’s not something that the Governor would want to get drawn into and so he very sensibly ignores it, again bridging away to one of his key messages.
11 min 15 sec Again, summarising what he believes Carny has just stated, Davis says: “So, 100 per cent clear – speaking as a chief regulator of the sector - someone working in a bank knows that they can make money selling something to an unexpected customer…they don’t really believe that it’s in the interest of the customer – should they sell it or not?”
“Absolutely - you shouldn’t sell it,” says Carney, again very strong and direct. “But let me be absolutely clear – the kind of behaviour you’re talking about is conduct behaviour.” Staying within his remit, he refers this to the Financial Conduct Authority, quite understandably, but then he adds that generally, wherever the Bank itself has an effect on these practices “We’ll snuff ‘em out.” Great use of colloquial language - you can’t get clearer than that!
12 min 15 sec “There aren’t any women on the MPC at the moment and that seems anomalous,” says Davis. Carney reminds the audience that he doesn’t choose the members of the MPC but then he takes the initiative by bridging across to a more positive message by talking about how the Bank is nurturing female economists. This ends up as the story in the Evening Standard.
So, all in all, how good a performance was this? Carney speaks at the right pace and uses natural language. He steers clear of a number of controversial issues and gets back to his main points.
Could he have done anything better? Well, he could have used some examples, perhaps talking about businesses that he’s visited and business people he’s spoken to recently. He talks about ‘savers’ and other groups but what if he’d used a phrase such as “Say, you’re a saver…” This would be more engaging and would speak more directly to the audience.
Overall, though, this was a good performance. As Robert Peston tweeted afterwards “The governor did his first @BBCR4today interview without breaking sweat. In a media sense, he is a class act.”
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