Wynne Godley interviewed by Alan Macfarlane 16th May 2008 0:09:07 Born in Paddington in 1926; my great-great grandfather married an heiress with a great deal of land in a very poor part of Ireland; he made a beautiful place with beech and oak woods overlooking lakes and a modest mansion house; house called Killegar near Kilbracken; he had a lot of children of whom the most distinguished was John Robert Godley who founded the province of Christchurch, New Zealand, in 1848; on his return became Permanent Secretary to the War Office and was much admired by Gladstone; during all that time he was ill; when my grandfather was twelve he went into his room and he told him that he was going to die; he died that same day; my grandfather, Arthur Godley, became very close to Gladstone and was his second Private Secretary in 1872 and actually lived in 10 Downing Street; he was Principal Private Secretary in 1884 and immediately after that became Permanent Secretary for India which he was for twenty-six years; he was a man of extraordinary ability and knowledge; he never went to India as he didn't think it necessary; his literary interest was Dante; he has been the positive inspiration of my life; he had such authority and was good with children whom he could entertain endlessly; he would get his chauffeur and we would go to the nearest station and take a train and the chauffeur would be waiting at the other end to pick us up; I loved him and I think about him more and more; my grandmother died in 1920 and very little is known about her; her maiden name was James; my grandfather became Lord Kilbracken on his retirement; he had two first cousins who were distinguished - Alfred D. Godley, a classical scholar, known mainly now for his comic verse including "What is this that roareth thus? Can it be a Motor Bus? …", and another who was a General who commanded the ANZACs at Gallipoli and Passchendaele where nearly 4,000 people were killed in one day under his command; my grandfather sold all the agricultural land in Ireland in the 1890's and just preserved the demesne; my grandfather did not like the house and never went there after his childhood; the house was let to a cousin of my grandfather's until 1936 11:32:06 My father was a severe alcoholic who fell in love with someone other than my mother so my parents separated about the time that I was born; I never really saw them together; they had a house that adjoined my grandfather's property in Sussex so I saw a lot of him in my early life; there was great enmity between my parents; I couldn't detect drunkenness so didn't know what was happening; my mother was fey and wrote children's poems; my father was a lawyer, a man of great personal charm; I had two older siblings and a half-sister who was mentally ill; the home was not populated so I was lonely, not properly educated, and ill; when I was seven my father had us all made Wards of Court and I went to see a Judge in chambers who said I was fit to go to school; at that age I couldn't even dress myself but went through the "chamber of horrors" of a British Prep school; it was called Ashdown House in Sussex; there was a terrifying man called Mr Bather; I was at school for about a year and a half and then went to Sandroyd which was favoured by rich businessmen, in Cobham, Surrey; remember an awful lot of beating though the teaching was excellent; among the masters was a man called John Graves, the brother of Robert Graves, who taught Latin, and a good maths master who encouraged me; the only thing that I really enjoyed was English; my father offered me £5 if I could learn the whole of the 'Ancient Mariner' by Christmas; I got to verse 135 but then the Headmaster stopped me; won the golf and chess championship there but was never good at regular games 22:43:01 At thirteen I went to Rugby which I still think was a good school; I was beginning to get very keen on music and I had two people in my life from about 1939 who were enormously influential; one was the music master who was called Kenneth Stubbs, a bachelor, who was a piano teacher of genius; he was a friend of Donald Tovey, a distinguished musicologist; during my time at Rugby he trained up six boys who played difficult music to a high standard; I spent a great deal of time in his house; I was learning the oboe; the second musical influence was William Glock, an extraordinary man, a very fine pianist, a pupil of Schnabel, but a bit of a rogue; he came on the scene as my mother's lover when I was about twelve; so I felt with Rugby that I was never really there as I was playing the oboe and later the piano; I had a good classics master and I learnt a lot of English from him, but I was really only interested in music 28:05:17 I went to Oxford and did Modern Greats; of the War, my brother was in the Fleet Air Arm, but it began just before I went to Rugby; it was never a serious phenomena for me; I was allowed to go with my father to Ireland during the holidays where there was plenty of food and no blackout; I went to Oxford at the end of 1943 and was there for three and a half years; I had lovely rooms in New College with my mother's Steinway grand; had wonderful teachers and Senior Common Room who were very indulgent to me; to begin with I was taught by P.W.S. Andrews who had heterodox views and I learnt about manufacturing industries from him; there was a lively musical life with Thomas Armstrong, the organist at Christ Church, who was in charge of the Orchestral Society; we got through huge repertories at a reasonable standard; great friend, physicist Christopher Longuet-Higgins, also a brilliant musician who ran his own orchestra in which I used to play; Isaiah Berlin taught me Kant and logic; did no economics; Berlin at that time had none of the grandness that came to him in later life; I found him a witty man; my attempts to judge what he wanted me to write then learning to think for myself; Lord David Cecil; Agnes Headland-Morley taught me modern history; Isaiah Berlin's lectures, humour; persona did change with fame; I got a first 40:14:20 Kept up with Longuet-Higgins when I went to Paris; went for three years immediately after Oxford; another friend in Oxford was Hugh Leach, a medieval historian, who had had tremendous success as a decoder at Bletchley; I was only twenty when I graduated and thought I would go and study music; I had the misconception to believe that I could learn to play the oboe well enough to earn my living by it and still have time to write novels; I was taught by the Professor at the Conservatoire whom I now think was a very bad teacher; for the first year I lived with a family where the father was a director of the French railways, a well-to-do middle class family with ten children, living in a huge flat in the 6th arrondisement; Nancy Mitford and husband, Peter Rodd; through her I met the Duff Coopers and spent a lot of time with Diana Cooper who had known my father; Duff Cooper had been Ambassador; loved Paris which was cheap and run-down; I got a scholarship from Alexander Korda which gave me enough money to live there for two years; though I was studying music I didn't hear much; my musical friends were all Americans, musicians and composers; at first public concert, one of them, Sarah Cunningham, had written a piece for violin and oboe, which I played with her; I had never been so frightened in my life, but it went quite well; if I did play in an orchestra it was in a conducting class; had the luck to be asked to substitute for as second oboe player in the New London Orchestra which was conducted by Alex Sherman; as I had no orchestral experience and asked for an audition and he liked me; the piece we played was Mozart's great C minor concerto which has incredibly difficult wind parts; the concert went well and afterwards, to my astonishment, I was fixed up for four more concerts; became the official second oboe in the orchestra and played all over London; I also got a job in a ballet orchestra; then became principal in the BBC Welsh Orchestra in 1951 where we had five live concerts a week; afterwards went with the Boyd Neel Orchestra on a tour of the United States and Canada; all this time I was getting ill from performance nerves and remember thinking that I couldn't continue 55:52:06 There was a counterpoint to the happy time in Paris because my father disintegrated mentally with drink; he was estranged from his second wife whom I was fond of; she shot herself at the beginning of my second year in Paris; my father died in 1950 just about the time I was coming back from Paris; he was living at Killegar; as a lawyer and a skilled draftsman he had become Parliamentary Council to the Treasury; he drafted A.P. Herbert's divorce Bill; he got an official job in the House of Lords but was sacked; as his child I couldn't distance myself from what was going on Second Part 0:09:07 Last concert I played in was late 1952 and then I came back to England; then I fell in love with my now wife, Kitty; she was at that time married to Lucian Freud and had two little children; I met her at a party given by Freddie Ayer in London; spent a lot of time having a good time, going to France and Ireland and trying to write a novel; eventually realized I must get a job; Kitty's father was Jacob Epstein, a very genial man; he made a bust of me which I gave to my daughter; it was adapted for the head of St Michael at Coventry Cathedral and put up in 1958; fascinating watching him work; P.W.S. Andrews got me an interview with an executive in the Metal Box Company and I got a job at £60 a month; it was an insignificant job in information and statistics, so rather humiliating; Kitty noticed an advertisement in the 'New Statesman' for economists in the Treasury and I applied; I had been swotting up how to measure the national income; I happened to know something about the price of tin and got a lowly job there in 1956; Epstein made the bust of me in February of that year and I went to the Treasury in March; I did not feel so humiliated except on occasions; what we had to do was to interpret more or less raw figures for use by the Government and there was an array of economists and statisticians from other departments who fed you the data; I had to write a report once a month on what had happened and what was going to happen, then do a big forecasting exercise once every six months on which the budget would be based and Ministers briefed; as time past I became quite an expert; the big change in my professional life was in 1964-5; I went on secondment to the National Institute and wrote a lot of pieces which were published then; when I went back to the Treasury it had all changed with a Labour Government; then I met Nicky Kaldor which, as it turned out, was a very big event in my life; I formed a close relationship with him and worked on one or two things, like the Selective Employment Tax in 1966, when I had to create the statistical system for loaning the tax; in the following year there was devaluation and I did all calculations on how big it should be; by then I was considered to be a coming man because of my knowledge; we thought we were drawing on the work of Keynes but it could just be drawn on and we had our own way of modelling the economy which I now think was seriously inadequate; Nicky persuaded me to leave when I was an Under-Secretary and to come to Cambridge; I am sorry to say that from a personal point of view it was the worst thing I have ever done 14:01:23 Nicky Kaldor, a Falstaffian intellect who thought with his gut; he emanated genius; he was very persuasive and would never give up; William Armstrong was the Permanent Secretary and Kaldor used to sleep at meetings; he was extremely greedy; he loved laughter, usually at his own jokes; he wanted me to be Director at the Department of Applied Economics at Cambridge; he also wanted me to be a Fellow of King's; as he was on the appointments committee he knew that I was going to be Director before anybody else knew; he immediately went to Edmund Leach (it was in 1970) but the professorial quota was full; nevertheless, Edmund immediately wrote to me suggesting that if I waited then I would get a Fellowship at King's which was entirely contrary to the quota system; in the next post I received two letters from other Heads of Colleges inviting me to join them; I felt very awkward about this; Burkill, Master of Peterhouse, invited me for the weekend and it was good fun, but I prevaricated; in the end decided I would not be bound by Leach and went back to Burkill, but he then decided he didn't want me; I had been used to the Treasury which was entirely hierarchical but absolutely united in purpose; I came to Cambridge supposing as Director that people would do as I told them; I was wrong; all they wanted from me was that I preserve their jobs as none of them had tenure; the appointment structure of it was very questionable; the place was bursting and it was difficult to see how I could do my own research; the appointment committee was also the committee of management; they all went to the previous Director, Brian Reddaway, and asked him to get me to agree to the right of the management committee to co-opt members; Reddaway put this too me in a neutral way although he would not have tolerated it himself; as members of the management committee were also members of the appointment committee and none had tenure, they were very highly motivated to gain tenure; I wrote and complained to the General Board but they did nothing about it; I was very unpopular; there were also troublemakers among the assistant staff; I was unhappy and very soon wished I had not come; I very nearly resigned 25:59:00 I was not properly trained as an economist and would not have been able to pass Part I as I only had my Treasury experience; that I did have and, for instance, was special advisor to the public spending committee which I knew a great deal about; I also knew that the economy was very badly covered in public discussion and knew more than any of the journalists at that time; decided to do my Treasury work in the Department of Applied Economics; that was very successful, at least in the sense that we got a lot of cover in the newspapers; Francis Cripps left his tenured job in the Faculty and came and worked, untenured, as an ordinary economist; we started the Cambridge Economic Policy Group together which produced reports and bulletins which were evaluations of the economic situation and prospects; to begin with, these were with special reference to public expenditure, and were fairly successful and got a lot of coverage in the press; Francis built an elaborate model of the British economy which we used to make projections; we got a big grant from the SSRC; we certainly got three of the big turning points right, 1974, inflation 1975, and the collapse of the economy 1979-80; we were unpopular with almost everybody and very pessimistic about the medium-term future; we very seriously entertained the possibility of protection as an economic strategy which is very unpopular with economists; we had a staff of about eight so also wrote pieces about regional policy; Francis also built a world model which we were just beginning to use; then came catastrophe because the SSRC turned us down for renewal; there was a serious flaw in their procedures as they didn't consult us or pay a site visit 31.26:21 I went back to the Treasury for a year in 1975 and wanted to get a piece of computing done to prove something and went to Francis with the equation; he got it done very fast; as the subject was secret I didn't say anything about it to him; I went back to the Treasury and gave it to their computer men; four or five days later they hadn't produced the answer; they couldn't understand how it worked; I am advised that they said that our computing system was antiquated and very slow; furthermore, not one of the consortium had ever built a model; there was no recourse and that was really a catastrophe as it meant that the group was broken up; Francis left and went to Thailand; this was in 1982; Francis was so clever and I had never learnt to touch a computer; I had to start doing modelling on my own and became reasonably expert; in 1974 I started on a line in macroeconomic research; I had an insight about how the economy as a whole was put together and started to write about it in 1978; Francis joined me and we published the book in 1983 but only about six people thought it was the work of genius that I thought it was; but the point was that it was not completely thought out; I was not deterred in my belief in the fundamental model; from 1983 I had a very fruitful year in Denmark and soon after coming back I retired and went to the States; I was very fortunate in landing a job at the Economics Institute at Bard; I continued writing about whatever economy I was in and I became familiar with the US economy and started to write strategic pieces on it; simultaneously I was evolving a new version of the book and making all the models myself; I also started to understand the economics which most people teach; in that I was assisted by Professor Anwar Shaikh of New School University with whom I used to have brainstorming sessions on the neoclassical synthesis which went on for hours; in the end I came to what I now believe to be a proper understanding of the system of ideas that had been opposed to; I then had a letter from Ottawa, from Marc Lavoie, saying that as one of four full professors they could not understand an equation in a paper; admitted there was a bad mistake in it; he came to see me and we got on very well and agreed to co-author the book I was then writing; he was very deeply sympathetic and a good scholar; that is what I have been doing ever since; the book came out just over a year ago [Monetary Economics: An Integrated Approach to Credit, Money, Income, Production, and Wealth] 42:34:12 Economists at King's and in Cambridge, powerful people who were "descendants" of Keynes, were impossible - vain, didn't sponsor other people's work, quarrelsome, and they left no legacy; I knew a lot of Kaldor's ideas but there is no Kaldorian textbook; there is no post-Keynesian synthesis; found Richard Kahn and Joan Robinson very difficult to talk to and very opinionated; a tragedy as all gifted; believe that Marc Lavoie and I had made a statement on macroeconomics which is enough for other people to build on, to rehabilitate another way of looking at the economy apart from the neoclassical; amazing fact that there are two paradigms deeply hostile to one another; the post-Keynesian one has been largely routed for the time being, both with regard to teaching appointments, publications, and the way people think; the main political implication of the book is that the market is king; the less the Government does and the market is allowed to act freely, that is the orthodoxy 49:40:11 Memories of King's - Edmund Leach and his anthropological writings; Frank Kermode as a squash opponent and scholar; music at King's - David Wilcocks and Stephen Cleobury; Adrian Wood and Christopher Prendergast; both Kitty and I found Cambridge an unfriendly place and didn't have a real sense of Fellowship at King's; thoughts on the future of the British economy, China and the decline of America