In 1970 DeAnne Julius,
a young and by several accounts bright American, left the University of
California in Santa Barbara and joined the CIA during one of the ugliest
periods in its history.
Her career choice would not have disturbed far-right Americans with no
qualms about the CIA-inspired massacres in Vietnam and their country's
decision to create the conditions for Pol Pot's victory by bombing Cambodia
'back to the Stone Age'. What is surprising is that it has not prevented
a Labour Government from putting a former agent of a foreign power on
the Bank of England's monetary committee.
Deanne Julius was, just 2 days after New Labour's
1997 landslide victory, handed the reigns of power by Gordon Brown for
setting Interest rates at the Bank of England.
Her alleged grip on interest rates set in motion the craze for spiralling
house prices, 'self-assessment' mortgage credations & unrestrained
'secured-policy' credit card loans followed by a Nationwide pandemic of
enslavement to the servicing of a £1.3-Trillion debt plus the luxury
of a 'sub-culture' devoted entirely to 'voluntary bankruptcy'!
Then Home Secretary David Blunkett remarked at Julius'
appointment at the Bank of England:
"This defeated my plans to reduce interest
rates and control unemployment".
This move effectively privatised the Bank of England.
Gordon Brown's decision to end democratic control over
the setting of interest rates gave Julius her entrée into British
Politics. Ever since their elevation, Julius and her colleagues have decided
what home-owners and businesses should pay for their mortgages and loans
and, indirectly, set the rate of the pound for exporters.**
Julius ...[will now be 57 years old but]
was 48 when appointed by Brown and is described by her friends as an open
women. She closes up when asked about her past. She confirms she did work
for the CIA as an analyst based in the Unites States.
"It was just a civil service job," she said. "I was looking
at the economics of Ceylon as it was then called."
'Why? What was the CIA's interest?'
"I'm not prepared to discuss it."
A CIA spokeswoman was equally vague. She described Julius'
labours as 'classified academic research'. This meant, she explained,
that Julius would have provided financial commentaries based on secret
information. She was pleased to hear that her former colleague was at
the heart of British economic policy. Her job was 'a logical progression.'
she told the Scotsman: a good assignment'. There is a faint possibility
that Julius did mention her life as a spook before Brown appointed her.
The Chancellor's aides say they knew nothing and there is no mention of
her time with the CIA in the potted biography issued by the Bank of England.
But now Brown knows, he says her covert past does not trouble him. 'She
was just a number cruncher,' explained an insouciant Treasury official.
‘It’s very hard to find American economists who have not worked
for the CIA. We wanted her because she’s very good. She gives the
The treasury’s justification was feeble to the point
of infirmity. Our civil servant does not explain why an American is running
monetary policy. Nor does he recognize that thousands of American economists
would not work for the CIA. ‘Credible' was not an adjective many
would have used to describe the agency in the early Seventies, when its
role in inciting the coup that overthrew Salvador Allende’s elected
Government in Chile – and in the mass murder and torture that followed
- was exposed along with its involvement in the Vietnam atrocities and
the grotesque betrayal of the Kurds of northern Iraq. (They were encouraged
to rise against Saddam Hussein and then abandoned to his tender mercies
when he did what the US wanted and stopped troubling the Shah of Iran,
America’s client.) Even US legislators were troubled and ordered
the first and only robust inquiry into CIA outrages. But Julius does not
appear to have been bothered.
She moved from the CIA to the World Bank and by 1989 had
a British husband, a home in London and a job at Shell. She was with the
multi-national at the moment when the staggeringly corrupt Nigerian government
was suppressing Ogoni protesting against Shell’s pollution of their
homeland. The company and its friends in the army received international
condemnation when the Nigerian military executed the Ogoni writer and
leader, Ken Saro-Wiwa. His death does not appear to have bothered Julius.
Nor, as far as I can see, did the record of chief strategist at British
Airways. When she arrived, the scandal about BA’s tactics in its
battle against Virgin was at its height. The names ‘Mission Atlantic’
and ‘Operation Covent Garden’ – BA’s alternately
sinister and ludicrous ‘operations’ to stop Virgin competing
on trans-Atlantic routes – peppered the papers. To persuade Virgin
passengers to switch to BA, the company hassled them at airports and called
them at home. Computer hackers found the addresses of Virgin customers.
BA’s managers assumed their opponents were equally creepy.
They recruited a force of private detectives to run counter-surveillance
operations against Virgin. A BA executive was wired for sound when he
went to meet a ‘friend’ he suspected of being a Virgin spy.
He wasn't’t. A journalist’s bins were searched. Nothing was
discovered. BA’s employees were assumed to include Virgin moles.
They were secretly monitored. No traitors were unmasked. Staff had a loyalty
their company would not reciprocate.
While Brown was deciding Julius was a ‘credible’
director of economic policy, the BA management was trying to break its
unions. Cabin crew threatened to strike against a new pay structure they
believed would lose each of them £4,000 a year. BA took industrial
relations to a post-war low by warning it would ruin strikers. They would
not only lose their jobs, redundancy rights and cheap travel, but also
their homes and savings in court claims for damages brought by the company.
Once again, surveillance was used against the BA workforce. Employees
on picket lines were caught by video cameras.
None of this appears to have bothered Julius, but it does not appear to
have bothered New Labour either. Tony Blair and Jack Straw remained close
friends of Bob Ayling, BA’s chief executive.
As you would expect, Julius is a very conservative economist.
Kenneth Clarke rejected Bank of England demands to raise interest rates
because he wanted to protect manufacturers. As a Midlands MP, close to
industry, he was well aware of the danger of an overvalued pound. It seems
unlikely that Julius will show a similar concern for the needs of the
Britain beyond the Home Counties. In an essay that won first prize in
an economics competition sponsored by the American Express Bank, Julius
and her co-author wrote that manufacturing industry was nothing special
and should not be protected. Companies would have to shift factories from
Britain and exploit the cheap labour of the Third World if they wanted
to survive. [This has come true].
‘It would be a critical mistake ‘ for Western governments
to try to stop factory closures. They should make the flight of capital
easier by encouraging free trade.
‘We are asking politicians,’ the authors condescendingly concluded,
‘to do what they find most difficult: Nothing!’ Oh well, there
goes the industrial base. Julius has hinted she finds the idea of democratically
accountable economic policy ridiculous.
‘Even well-intentioned politicians are less able to make fine judgments
about complex economic forecasts than professional economists,‘
Julius has chosen to remain an American citizen. Her salary
at the Bank of England (1997) is £130,000. She has worked for a
brutal espionage bureaucracy and two pariah corporations. Ken Livingstone
was the only Labour MP to raise doubts about and appointment he describes
as ‘incredible’. As soon as the leadership said it was going
to pass the power to set interest rates to the Bank of England, he asked
Brown if there would be a consultation about the merits of candidates.
Brown dusked the question, and the most powerful un-elected jobs in British
government were filled in secret. Livingstone asks what will happen when
her loyalties clash and British and American economic interests conflict.
Most Labour backbenchers have spent their time since the general election
drooling over ministers. Is there a chance that MP’s from industrial
constituencies, for example, will start asking Brown hard questions?
Or can’t they be bothered? [Observer, October
** Between June 1997 and the autumn of 1998, the Bank
of England ignored a global recession and regarded the non-existent threat
of inflation as an ever-present danger in an era of collapsing commodity
prices. Interest rates were raised continuously and manufacturing industry
was crucified by the high pound and dear money.
In June 1998 Brian Sedgemore, a left-wing Labour MP, embarrassed
his colleagues by presuming to cross-examine Deanne Julius when she came
before the Commons Treasury committee.
“I see from looking at your CV that in 1970-71 you worked for the
CIA. Am I right in thinking once a member of the CIA, always a member
of the CIA?”
‘No, I’m afraid you are not.’
“The time you were there coincided with the undermining of Allende.
Did you know about this?”
“Did you subsequently feel any shame at working for an agency when
it was undermining a democratic government?”
‘I had nothing to be ashamed of.’
“You worked for Shell between 1989 and 1993 when the Nigerian government,
allegedly with the collusion of Shell, was attacking the Ogoni people.
Have you any worries about your occupation with Shell in relation to what
you now know has happened in the Ogoni region?”
‘None at all.’
“Between 1993 and 1997 you worked for British Airways when it was
running its dirty tricks campaign against Virgin. Did you know about that?”
“Would you describe yourself as an observant person . . .?”
You learn all you need to know about the Bank of England
when you discover that the shameless Julius is considered a liberal softie.
The other Brown appointees are far more extreme.
Reproduced from 'CRUEL BRITANNIA', by Nick
Cohen. 2000. ISBN 1-85984-288-7.
the time of writing of this article produced word for word here,
Nick Cohen was a columnist for the Observer newspaper and wrote
regularly for the New Statesman. His articles have appeared in a
wide range of publications including the Independent on Sunday,
London Review of Books, Modern Review and Jewish
From the rear cover sleeve notes of the book.
"Cruel Britannia" - 'Reports on the sinister
and the preposterous'.
Any addenda or comments by submitter are in