Pros and cons
R. F. HARROD
This book consists in large part of quotations from economists, especially from those who have ventured from time to time to make com- ments on public affairs. It is to be feared that they do not make a very good showing.
It would be inappropriate for me, who am much quoted, to come to their defence in a general way. It is well known that economists have tendered conflicting advice on policy questions. That is presumably inevitable in cases where a recommendation for action in- volves a value judgment, as it often must. What is required is care in making such a judgment explicit. It must be admitted that economists have also differed in their analysis of how our economic system actually works. I have been at pains to emphasise from time to time that dynamic economics is still very much in its infancy. There is no magical cure for this. The only remedy is continuing research over a number of years, fertilised, we hope, by the occurrence of new ideas from time to time.
It is fair to add that the general reader may get too unfavourable a view of, the diversity of opinion among economists. There is a large area of lgreement in relation to fundamental matters, especially in static economics, and I have no doubt that the various professors cited by Professor Hutchison concentrate mainly on this when exercising their responsibilities as university teachers. The faults of this book are, first, that, by quoting out of context, the author makes, his authorities seem to contradict themselves when they, are not in fact doing so; secondly, he seems not to have taken the trouble to under- stand the thought of each writer quoted con- sidered as a whole; and, thirdly, that he has not presented a coherent view of his own of the developments in the period, so that we
lack a background against which to judge whether the various pronouncements by eco- nomists make good sense or not.
Lord Kahn once told me that Keynes said that every morning when he woke up he felt
like a new-born babe, meaning that he felt free and able to rethink his economics afresh from the beginning. He was considered by some to
be unstable in his opinions. It is certainly a
virtue not to suppress one's real opinion about today, merely to achieve a reputation for con- sistency. None the less, when I restudied Keynes's lifelong thought from start to finish, I found a quite remarkable consistency in its development.
I do not pride myself on consistency, nor would I dream of claiming that I have made no mistakes. Yet the only statement of mine of the many quoted with which I now find myself strongly disagreeing, was when I said in 1951 that 'the magnitude of the change [sterling devaluation in 1949] was probably a mark of wisdom.' I did not advocate devalua- tion, but, when it had occurred, I judged (November 1949) that 'it must help the dollar balance a little.' Later (1951 and 1952), when there had been time to see how things turned out, I said that it had injured our trade balance. This is surely not an inconsistency.
I am quoted as saying, 'Above all we must avoid making the maximum growth of the
GNP a "sacred cow."' In this paragraph in my book it is made perfectly plain that this statement was made to safeguard the claim of leisure. Mr Hutchison writes, 'Hbwever, a few pages later Sir Roy concluded, "Growth, always subject to any desirable increase in leisure, has priority over all other objectives." The word 'however' implies a change of atti- tudes, and since the 'sacred cow' passage is taken out of its context, the reader will naturally infer a stark contradiction.
In relation to the 1957 'crisis,' I have taken an absolutely consistent view before, during, after and since, namely that it was due to the expectation that the German mark would shady be valued upwards and that there was nothing wrong with the domestic economy in that year. Study of my Topical Comment, where I printed both contemporary articles written during 1957 and my summary in restrospect written in 1961, will fully confirm this.
• Space forbids my attempting to come to the /rescue of Lord Balogh.
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