Wow, synchronicity!

American economist Paul Volcker cropped up in the book I was reading on my journey in to work this morning (The Shock Doctrine by Naomi Klein).

Then I sat down at my desk and flicked through all the day’s papers only to catch sight of a Daily Telegraph report headlined, ‘US should introduce VAT to tackle huge debt, says Volcker’.

It seems that the latest idea from the elderly chairman of the White House economic recovery advisory board hasn’t gone down well with his boss. President Obama would prefer to make tax cuts for working-class and middle-class people, and he is especially loath to introduce a new levy – and a regressive one at that – in the run up to elections in both houses of Congress.

Volcker’s stock continues to fall. He made himself unpopular with big business earlier this year by proposing rules that would not only limit the trading commercial banks do for their own accounts but would also prevent them from owning and investing in hedge funds and private equity.

One suspects, however, that the 82-year-old economist is used to not being liked. He is, after all, the man who as chairman of the Federal Reserve from 1979 to 1987 allowed interest rates to reach 21%, leading to a surge in domestic bankruptcies and mortgage defaults.

This became known as ‘Volcker shock’, and it had disastrous consequences for foreign nations’ finances – particularly those in the developing world, as Naomi Klein's book makes clear.

And yet Volcker abides. He is, according to the Telegraph, one of the commander-in-chief’s ‘most trusted economic advisers’.

A morning not just of synchronicity, then: there was contradiction, too. And, I think, there's room for trepidation.

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