Will Norman Lamont be remembered as the most inspirational politician of our times? Impossible? Well consider this: Ben Bernanke, the new guy at the Fed is a Lamont fan. For years Bernanke has been advocating the US adopt inflation targeting, the strategy Lamont pioneered in 1992 and which has been adopted in 20 countries including Australia, Canada, Israel, Sweden and the European Central Bank.
Lamont came up with inflation targeting in the aftermath of "Black Wednesday" in September 1992. His revolutionary objective was to keep underlying inflation within the range 1-4 per cent but aiming for "the lower half of that range". In addition, a target rate of 0.4 per cent was retained for the narrow monetary aggregate M0, and a "monitoring range" for the broad monetary aggregate M4.
The effects of this approach have been wonderful - an end to political tinkering with the interest rate and stable and low inflation, something unimaginable before Lamont. Is he recognised for this? No - all the press remembers are his Gerald Scarfe eyebrows and his role in the ERM fiasco.
This is unjust. For starters, Lamont always opposed Britain’s membership of the Euro, and forecast the problems that occurred. He was the first to propose handing over control of interest rates to an independent monetary policy committee, which Gordon Brown effected in 1997. He was cool under fire, singing in the bath during crises and declaring "Je ne regrette rien" about the Britain leaving the ERM.
And Lamont’s fiscal record was superb. His 1993 budget, The Times’s Anatole Kaletsky says, "put Britain’s fiscal house in order once and for all after Black Wednesday and paved the way for more than a decade of uninterrupted economic growth".
The man is a legend, as Bernanke will testify. Isn’t it time we Brits gave "Norma" a long-overdue pat on the back – and remind Gordon Brown just who really is reponsible for our current prosperity?