Description

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Central banks now stand between societies and collapse, but are they still democratic?

Two decades of financial crises have dramatically expanded central banks’ powers. In 2008, and then again in 2020, unelected banking officials found themselves suddenly responsible for the public welfare—not just because it was necessary but based on an idea that their independence from political systems would insulate them from the whims of populism. Now, as international crises continue and the scope of monetary interventions grows in response, these bankers have become increasingly powerful.

In Balance of Power, economist and historian Éric Monnet charts the rise of central banks as the nominally independent—but unavoidably political—superpowers of modern societies. This trajectory, Monnet argues, is neither inevitable nor unstoppable. By embracing the political natures of today’s central banks, we can construct systems of accountability for how they interact with states and societies. Monnet shows that this effort will do more than guard against unjust power; it will put the banks to work for greater, more democratic ends.

With existential challenges looming and the work of the Federal Reserve and European Central Bank more important than ever, Balance of Power offers a trenchant case for what this century’s central banks can—and must—become.

About the Author

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Éric Monnet is professor at the Paris School of Economics and director of studies at the School of Advanced Studies in the Social Sciences, Paris (EHESS). He was named France’s best young economist by Le Monde in 2022.
 

Steven Rendall is professor emeritus of romance languages at the University of Oregon. He has translated more than eighty books into English.

Praise For…

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“[An] impressive history of how central banks have become political superpowers of modern societies. . . . Monnet argues that central banks’ monetary policies should be subject to democratic control, as the banks’ current powers are too significant to be solely managed by independent authorities operating as inward-facing technocrats.”
— Library Journal

"An unflinching, revelatory book. Monnet reopens the public debate on central banks for this century. A must-read."
— Thomas Piketty, author of 'Capital in the Twenty-First Century'

“Balance of Power explores the key challenge facing modern central banks: being democratic while remaining independent. Monnet captures everything that makes these institutions so interesting—and so essential to contemporary societies.”
— Jean-Pierre Landau, former deputy governor, Banque de France

“A forceful argument that central banks’ policies and money creation should be subject to democratic control. Populist? Maybe. But also bold and commonsensical? Absolutely.”
— Hélène Landemore, author of 'Open Democracy'

“Monnet shows that the political natures of central banks must be acknowledged—and then legitimated—if we are to retain their critical role for the public welfare. An essential work from one of the most important economic historians of our time.”
— Jonathan Levy, author of 'Ages of American Capitalism'

“Balance of Power shows that the biggest challenges of our time—climate change, rising inequality, geopolitical fragmentation—become more solvable when we reconnect central banks to the people they are meant to serve. This is a book whose time is now.”
— Saule T. Omarova, Cornell University

“A lucid, compelling case for connecting central bank policies to other imperatives of public policy, from the environment to wages and beyond. A must-read for anyone interested in how democratic institutions will adapt in the twenty-first century.”
— Katharina Pistor, author of 'The Code of Capital'