Note: I’ve corrected this post in light of the comments below that produced the text I was unable to find.
In my blog post the other day about the Netanyahu government’s moves toward regulating the Israeli finance industry, I meant to elaborate about the role of Stanley Fischer, the governor of the Bank of Israel, one of the architects of the surprisingly progressive plan. I didn’t elaborate on Fischer because I couldn’t find the on-line document that best captures his unusual place in the universe of international finance. It seems the document has disappeared from the Internet. (Postscript: It’s been found: here.)
(I guess this paragraph can be ignored, though I can’t explain how it escaped me.) It’s supposed to be in the on-line archive of the International Monetary Fund, where Fischer used to work. It used to be there. I read it there. It’s cited in other IMF documents as being available there. But it’s not there now. Somebody apparently took it down.
My point would have been that the seeming unexpectedness of the new Israeli regulation effort shouldn’t be unexpected if you know a bit about Stanley Fischer’s background. In a word, he’s a progressive within the world of international finance, close to the third-way approach identified with Tony Blair and Shimon Peres, miles away from the market fundamentalism that has brought down our own country and that Bibi Netanyahu is supposed to be identified with.
I wrote about Fischer’s background and leanings in a brief column in 2005 when he was appointed to head the Bank of Israel, the equivalent of the Federal Reserve. The appointment caused a fuss at the time because he was an American; Israelis were shocked that a foreigner would be imported to take such a critical role in the government. Some commentators were writing at the time that the conservative Netanyahu was obviously picking a vice chairman of Citibank who was associated with the University of Chicago, citadel of the arch-conservative Milton Friedman.
In fact, Fischer’s resume is anything but Friedmanesque. He was educated at the left-wing London School of Economics and spent most of his academic career at M.I.T., where he earned his doctorate. His time in Chicago, 1969 to 1973, was basically an interlude.
As for familiarity with Israel, he was intimately involved in the Israeli economy, as far back as the early 1970s, when he took the first in a string of visiting teaching positions at Hebrew University. In 1984 he worked closely with then-prime minister Shimon Peres to reverse the runaway hyper-inflation of the Menachem Begin years. The effort was notable, perhaps unprecedented, in reversing a hyper-inflated, runaway economy without impoverishing the middle class in the process.
But the seeds were planted much earlier.
Fischer is originally African, born and raised in Northern Rhodesia, today’s Zambia. He went to high school in Southern Rhodesia, today’s Zimbabwe, where he became active in Habonim. He went to Israel in 1960, first on a youth-movement leadership course, the Machon, and then at Kibbutz Ma’agan Michael. He left the kibbutz in 1963 when he was accepted with a scholarship to LSE in London.
Fischer is best known for his tenure as first deputy managing director of the International Monetary Fund, the number-two slot, from 1994 to 2001. The IMF customarily has an American as No. 2 and a European as No. 1, managing director. Fischer was appointed during the early, populist stage of the Clinton administration, before the populalist labor secretary Robert Reich was pushed aside and the neo-liberal treasury secretary Robert Rubin took command of policy.
So what’s missing (or was it?)? A speech in celebration of Fischer by the socialist finance minister of Angola is missing. In 2000, when IMF managing director Michel Camdessus stepped down, Washington and Brussels deadlocked over a choice to succeed him. Stepping into the breach, the African group proposed that the fund choose someone who was neither European nor American. Instead, Angolan finance minister José Pedro de Morais Jr. nominated Fischer, in a speech that praised him to the skies as a true son of Africa and a friend and champion of the poor.
You can ignore the rest, though I still can’t explain why it wasn’t showing up in the IMF website when I looked. [So I was going to link to that speech in my blog post the other day. It’s the bluntest, most detailed exposition I’ve seen of Fischer’s role and reputation in the world economy. Only it’s not there anymore. It’s listed in this IMF newsletter from March 2000 as being “available on the web” at imf.org. I read it on the IMF website in 2005. Now it’s not there. It’s not anywhere on the Web. I searched for more than an hour.]
[I wonder if somebody at the UN took it down, figuring that by moving to Israel Fischer disqualified himself as a son of Africa and friend of the downtrodden.]
By the way, Fischer was named central bank governor of the year a week ago by Euromoney magazine. He received the award in a ceremony in Washington during the semi-annual meetings of the IMF and World Bank.