Mervyn King is failing the British economy

In one of his periodic and cheerless progresses around the country, Mervyn King recently found himself in Leeds. Before an audience of the city's businessmen and financiers, the governor of the Bank of England ended a somewhat downbeat speech about the state of the economy with a ringing declaration. "The long march back to boredom and stability has started this evening in Leeds," he boomed.

If only.

King's speeches, of which he has given a few, may convey the idea that he knows where he is going and that he is moving purposefully in the right direction. But his handling of the Bank of England during the credit crisis tells another story.

Since the crunch began in August 2007, King has given a very good impression of a man overwhelmed by events. Under his leadership, the Bank has been too slow, first to rescue the banking sector and then to throw a lifeline to the wider economy. King failed to grasp the seriousness of the situation at Northern Rock and derailed the only potential rescue, leading to the first British bank run for 141 years.

King’s reluctance to act seems to spring from a sort of Puritanism

Despite this searing experience, it then took a further 13 months and three major bank failures before he finally stirred his stumps and started to cut interest rates seriously.

One member of the Monetary Policy Committee who argued consistently for lower rates, David Blanchflower, grew so frustrated during this period that he accused King of "fiddling while Rome burned". He has just announced that he won't be standing for another term on the committee when his current one ends next May.

Even now, the government is trying to push him to do more to prop up what's left of the financial system and the economy. The Treasury is publicly urging King (who has operational responsibility for monetary policy) to undertake a policy of so-called 'quantitative easing'.

This is when the central bank prints more money and uses it to purchase government bonds - driving down mortgage rates. It is what you do to stop a Japanese-style deflationary spiral when all the other levers won’t work any more.

Whether or not quantitative easing is the solution, it is alarming that King should be publicly nudged in this way. But it is something he has brought on himself.

King's reluctance to act is not purely the product of a conservative temperament. It also springs from a sort of Puritanism. He seems