21 March/22 March 2020 ★ FT Weekend 5When Barbara Harris became the
American Episcopal Church’s suffragan
— or deputy — bishop of Massachusetts
in 1989, two millennia of church history
were upended.
Bishop Harris, who has died aged 89,
wasthe first woman bishop n her owni
denomination and in the worldwide
Anglican communion, led by the
Church of England. No woman had pre-
viously served in the episcopate of any
church tracing its lineage from the first
apostles consecrated by Christ. Yet, as
clergy at the ceremony in Boston fussed
over clothing her in the formal bishop’s
vestments, she expressed her self-confi-
dence andlack of pomposity. “The
mitre fits just fine,” Bishop Harris
scolded them.
The episode encapsulates much about
a black woman who survived the racism
of segregationist America — and the
uproar over her consecration — to
become a consistent voice for marginal-
ised groups. Kelly Brown Douglas, an
African-American Episcopal priest who
co-wrote Bishop Harris’s memoir,
recalls how the consecration revealed
the charisma of Bishop Harris, who was
only around 5ft tall.
“I was struck by the small woman, butyet her shoulders were broad, and she
was walking with confidence and sway-
ing to the music,” Rev Douglas, dean of
the Episcopal Divinity School at New
York’s Union Theological Seminary,
says. “It was like she was made for that
moment.” Her scolding of those conse-
crating her reflects what acquaintances
recall as an appealing directness.
Nancy Webb Stroud, an Episcopal
priest in Massachusetts, met Bishop
Harris in early 2006 when a minister in
Philadelphia. It was only weeks after
Rev Stroud’s ordination as a priest. She
was apprehensive about welcoming the
bishop as preacher to a service marking
her parish’s 150th anniversary. “I
arrived early and found her out on the
front portico, smoking her usual ciga-
rette,” Rev Stroud remembers. “We had
never met before, but she took one look
at me, swept me toward her tiny little
self, hugged me fiercely, and said, ‘You
must be Nancy!’”
Harris may have been warm but she
was no play-it-safe choice. Winnie Var-
ghese, an Episcopal priest who is on the
staff of New York’s Trinity Wall Street,
points out that her marriage had ended
in divorce, in 1963. Bishop Harris also
assisted in 1974 at the ceremony for thePhiladelphia 11, women ordained to the
priesthood by three retired bishops in
defiance of the church authorities. The
general convention only accepted
women’s ordination in 1976. “She was
not an appeasing character in any way,”
Rev Varghese says. “She was outspoken
and fierce.”
After being consecrated, her resencep
at the Lambeth Conference of Anglican
bishops, the gathering held in London
and Canterbury every 10 years, excited
such anger from conservative fellow
bishops that she said she was spat upon.
Barbara Clementine Harris was born
in Philadelphia in 1930. After pursuing a
career as a journalist, and later in public
relations, she joined the priesthood at
the relatively late age of 50, in 1980. She
had participated in the civil rights
movement, including Martin Luther
King’s 1965 march from Selma, Ala-
bama, to Montgomery.
Yet Harris, the daughter of a steel-
worker, was also steeped in Episcopa-
lianism —the denomination s a spirit-i
ual home for much of the white, East
Coast American elite, as well as for some
African-Americans. The white bishop
who came to confirm her and her fellow
adolescents nusually wore gloves withuhis vestments, she later recalled. She
suspected he wanted to avoid touching
the black children.
Rev Douglas says her opposition to
such discrimination grew out of faith.
“Barbara didn’t mince any words but I
always knew that it wasn’t out of any
sense of hate or anger,” Rev Douglas
says. “It was out of this fierce belief and
commitment to what she knew was
God’s more just future.”
Harris served in Massachusetts until
2003 and then as an assisting bishop in
Washington DC until 2007. “She had this
saying, ‘I wouldn’t go back to the Lam-
beth Conference if Jesus was there hand-
ing out hundred-dollar bills’,” Rev Var-
ghese recalls. But she was never
silenced. In later years, Harris spoke up
for gay and lesbian Christians, whose
treatment opened divisions in the
Anglican communion reminiscent of
those over her own consecration.
She argued for equality in characteris-
tically forceful language, according to
Rev Varghese. “She said, ‘There’s no
half-ass baptism — either you’re bap-
tised or you’re not’,” Rev Varghese
recalls. “She said that God loves you now
as much as he will ever love you.”
Robert WrightObituary
A pioneering
and outspoken
voice for the
marginalised
Barbara Harris
Anglican Bishop
1930-‘She didn’t mince words
but it wasn’t out of any
sense of hate or anger —
it was fierce belief in
God’s more just future”
Barbara Harris marched from Selma
with Martin Luther King in 1965A time for big spending
T
he Covid-19 pandemic that
is ravaging lives and liveli-
hoods around the world has
also claimed a more subtle
victim: conventional taboos
in economic policy thinking areswiftly
being swept away.
Economic proposals that a week ago
looked radical now appear timid. Fiscal
packages bigger than anything seen in
years areconsidered too smallonly a
few days after they were announced.
Robert Chote, the head of the watch-
dog charged with monitoring UK fiscal
discipline, said this week the govern-
ment should not worry about short-
term deficits because it was facing
something like a “wartime situation”.
“This is not a time to be squeamish
about one-off additions to the public
debt,” he told MPs.
There has been a “recognition that
this shock is absolutely different” from
previous crises, says Beatrice Weder di
Mauro, an economics professor and
president of the Centre for Economic
Policy Research. “Things are moving
very fast, and minds are too.”
The result is that a series of policy
ideas which were once the province of a
small number of mavericks and limited
to purely theoretical discussions are
takingcentre stage.
The most important of those unortho-
dox approaches is the“helicopter drop”
— printing money and handing it out to
everyone, with no strings attached.
Ms Weder di Mauro has co-edited two
ebooksonthe economics of the virus
crisis inas many weeks. She observes
that the mainstream of economics has
moved very fast towards the view that
the best policy would assure that
“nobody should lose their job or their
income because of the virus”.
Even supporters of this once unthink-
able approach acknowledge it will be
expensive. “We have to be willing to
accept fiscal deficits on the scale of
2009,” saysAdair Turner, the former
head of the UK’s Financial Services
Authority.
Given the need for large fiscal deficits,
the debate about helicopter money
really involves two separate policy ques-
tions, he says. The first is how to finance
the stimulus — should the central bank
pay for it through direct monetary
financing, effectively printing money,
or should governments borrow in the
usual way? The second is how the
money is then distributed, whether
through cash handouts or other govern-
ment spending.
As it is, economists and policymakers
are warming to radical answers to both
questions.
Central banks have not yet explicitly
offered to monetise deficits, but they
have opened the taps on bignew asset
purchase programmes o buy the glut oft
bonds governments will soon issue. In
the eurozone, there are live discussions
about issuing a joint “corona bond” or
ramping up credit lines from the Euro-
pean Stability Mechanism, the mone-
tary union’s rescue fund for sovereigns,
in the expectation that the European
Central Bank would keep the cost of
such borrowing low.
Some economists now call openly for
explicit helicopter money in the sense
that central banks should directly fund
government deficits. “I do think the
time is right for monetary finance,” says
Lord Turner. “There would be a clarity
of assuring people that there is no limit
on the money available.”
Monetary finance was popularised as
a theoretical possibilitybyBen Bern-
anke, former US Federal Reserve chair.
Since leaving the Fed, Mr Bernanke has
publicly argued that “under certainprofessor at the University of Michigan
and a former economic adviser at the
Obama White House, points to the
broad coalition of people all supporting
cash handouts: “People on the left.. saying this is great, people on the.
right... wanting to help the middle
class; those who like the administrative
simplicity of it; and then people who
realise time is of the essence.”
A second factor behind the interest in
these ideas is that they are not entirely
without precedent. The financial crisis
and its aftermath forced central banks
to take actions that brought them closer
to monetary financing.
Helicopter money is already here in
the sense that “a central bank gives
transfers to the private sector”, saysEric
Lonergan, a macro fund manager. He
adds that the ECB now offers loans to
banks at a lower interest rate, under cer-
tain conditions, thanbanks receive on
reserves held on deposit with the ECB.
That margin is an outright money-fi-
nanced fiscal transfer. Mr Lonergan
argues this can be expanded and tied to
conditions thatin effect would transfer
the subsidy to individuals.
Lord Turner says that there is no hard
distinction between outright monetary
financing and central banks’ existing
practice of buying government bonds.
“Every year the Bank of Japan buys Jap-
anese government debt equal to the gov-
ernment deficit. So the volume of bonds
owned by the private sector does not
rise. That is permanent monetary
finance,” he argues.
Governments have also sent no-
strings-attached cheques to all citizens
before. “[President George W] Bush did
direct cash handouts,” says Ms Steven-
son. The difference is that in the 2001
and 2008 recessions the intention was
to stimulate demand, today it is to “put
money in the hands of people who will
lose their jobs” and prevent a “cascading
economic downturn”.
Aside from precedent, the most
important reason for the interest in heli-
copter drops — both as monetary
finance and as direct cash payments — is
the scale of the economic challenge.
“If anybody had told you at Christmas
that this year would be one [with] an
enormous symmetric shock hitting all
the advanced countries and that this
would cost something like 50 per cent of
GDP for a few months or maybe longer.. the kind of thing that happens in a.
war, everybody would havesaid you are
crazy,” says Ms Weder di Mauro. “There
was no imagination to see where some-
thing like this could come from.”
Governments now find themselves
needing to spend much more, and to do
so much faster, than they are accus-
tomed to. “The attitude should be we’re
at war with this pandemic, we’re going
to win this war,” and double-digit defi-
cits are a price worth paying, says Ms
Stevenson. “If we win the war, we can
recoup that money.”
Ms Weder di Mauro says our institu-“
tions are not built for this”. For good rea-
son, governments have designed sys-
tems to direct spending to those who
need it the most and to avoid “moral
hazard”, where individuals or compa-
nies receiving public money are
rewarded for poor behaviour.
In the current crisis, however, these
disciplines have become obstacles to
pursuing the right policy. One case for
direct cash payments is that it will reach
more people faster than the existing
benefit system. Ms Stevenson says the
US’s state-level unemployment insur-
ance system will struggle with the flood
of claims about to hit it.
“It is quite possible they will have to
process 1m [claims] a week, but they are
not staffed up to process that,” she says.
“It’s too hard to figure out who really
needs it. Get money into everybody’s
hands, then we can clean it all up later.”
There are some countries where
direct cash handouts are considered less
important because they have more
sophisticated and generous benefit sys-
tems. Germany and other countries
have had success with subsidisingKur-
zarbeit, where employers are paid to
keep employees on their payroll while
temporarily cutting their shifts. Yet
even in a country like Norway, some
economists have called for universal
cash payouts to avoid convoluted proc-
esses of means-testing.
As for helicopter money, govern-
ments and central banks are not quite
there yet. It could even be that faced
with the prospect of outright monetary
finance, the more hawkish eurozone
leaders will prefer joint guaranteed bor-
rowing — through a eurobond — which
they have previously opposed but may
consider a lesser evil. Either way, past
taboos are rapidly evaporating.
“The fiscal-monetary distinction may
break down” if the crisis is long-lasting,
says Ms Weder di Mauro. “In wartime,
all sorts of distinctions break down.”
But, she adds: “The instruments still
have to be adjusted to how severe the
problem turns out to be. Whatever it
takes doesn’t mean you shoot every-
thing you have in the beginning.”F T B I G R E A D. GLOBAL ECONOMY
Until recently, the idea that central banks should print money to finance huge government deficits was
heresy. But the coronavirus crisis has led policymakers and economists to tear up conventional wisdom.
By Martin Sandbu
extreme circumstances” monetary
financing of fiscal deficit spending “may
be the best available alternative”.
This had long been an unacceptable
view among economists, who were
scarred by the stagflationary 1970s and
worried about the dangers of hyperin-
flation that had ravaged countries in
interwar Europe and more recently in
the developing world. This changed
with the global financial crisis, when
central banks engaged in massive
money creation without inflationary
effects. Warnings about hyperinflation
lost their bite.
As for direct cash handouts, they are
already happening. In February, the
government of Hong Kong decided to
transfer HK$10,000 ($1,270) to all resi-
dents financially affected by the virus
outbreak. Singapore’s latest budget, too,
provides for small cash payments to all
adult Singaporeans.
In the US, support is building for send-
ing cheques directly to all Americans.
Former economic advisers to presidents
Barack Obama and George W Bush sup-
port the idea. President Donald Trump
and his Treasury secretary Steven
Mnuchinhave proposed it, and senators
have included it in the stimulus bill cur-
rently going through Congress.Handouts that are already here
One reason why these unconventional
ideas are gaining traction is because the
financial crisis, growing inequality and
the fear of technological automation
causing unemployment had already
triggered growing interest in new policy
approaches. “There is a bit of ‘I always
wanted this’,” says Ms Weder di Mauro.
Betsey Stevenson, an economics‘I do think
the time is
right for
monetary
finance.
There
would be a
clarity of
assuring
people that
there is no
limit on the
money
available’US Treasury
secretary Steven
Mnuchin with
his wife Louise
Linton at the US
Bureau of
Engraving and
Printing in 2017.
He has backed
the idea of
sending cheques
directly to
citizens Bloomberg—‘It’s too hard
to figure out
who really
needs it (in
a state-level
insurance
system). Get
money into
everybody’s
hands, then
we can clean
it all up
later’MARCH 21 2020 Section:Features Time: 20/3/2020- 19:05 User:alistair.hayes Page Name:BIGPAGE, Part,Page,Edition:USA, 5, 1