The Issue of Political Independence.
In light of her selection as next president of the European Central Bank, the global financial policy community has been abuzz about a letter written by Christine Lagarde to then-French President Nicolas Sarkozy. The letter was discovered in 2013. The contents of the letter were revealed in the newspaper Le Monde at the time Sarkozy was under deep scrutiny by the French legal system for dealings related to the large government-owned French bank Credit Lyonnais.
The surprise was the degree to which Lagarde presented herself on paper as subservient to the French government. In her now-published letter, Lagarde said things such as, "Use me for as long as it suits you and suits your plans and casting call." The undated letter was likely written between 2007 and 2013, during which time Lagarde served as French finance minister and then head of the International Monetary Fund. The revisited letter has created sensitivity at a time when the independence of central...
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