Indipendant


A shorter version of this tribute appeared in The Independent on 12th October 2005

Dennis Kavanagh's perceptive obituary of Arthur Seldon (12 October) pays fitting tribute to Arthur's decades of quiet toil as the Editorial Director of the Institute of Economic Affairs, a selflessness which helped launch the careers of literally hundreds of young economists - in IEA publications, the pages of Economic Affairs and, after his "retirement", in The "New Right" Enlightenment, a collection of twenty essays by young writers he edited (of course) and published himself, as E&L Books. As Arthur's amanuensis for the last decade of his professional life (and the first of mine) and his successor as editor of Economic Affairs, I experienced that patient encouragement at first hand, and learned from the libertarian vision which informed his thinking.

Dennis Kavanagh points to the occasional strains in Arthur's relationship with Ralph Harris, then General Director of the IEA, with Harris as the gregarious front man and Seldon the studious and tongued-tied academic (incidentally, he attributed his stammer to the discovery, at age 11, that he had been adopted). But it wasn't simply a question of personality: there was also a profound difference in philosophical position, Harris the conservative arguing for a smaller state, Seldon the radical liberal distrusting the very institution of government. These divergent outlooks helped generate a productive tension between the two men, one of the reasons their partnership was so effective.

Arthur thus warmed less to Milton Friedman's "monetary rule", a device for imposing discipline on governments tempted to inflate the currency for political ends, than to Friedrich Hayek's argument (first proposed in Choice in Currency in 1976 and refined in The Denationalisation of Money in 1978 - both, naturally, edited by Seldon for the IEA) that the state should not issue money at all; instead, competing currencies could be issued by private financial institutions, secured against a basket of commodities and policed by competition in the market place.
At a meeting of the Mont Pèlerin Society (an association of free-market economists founded by Hayek in 1947) in Cannes in 1996, with many of those present congratulating themselves on the rolling-back of the state around the world, Arthur took the floor to complain about the slow pace of reform. His central argument on that occasion - "If we wait for government to give us what we want, we'll never get it" - was a libertarian call to arms many of his more conformist colleagues would never have dared to utter. He saw growing tax evasion as evidence that individuals were already taking matters into their own hands.

Seldon's radicality allowed him to extend market analysis in directions that were new. He understood that price was a vital signal between producer and consumer - sometimes literally. When in 1964 he almost died because of a shortage of (unpriced) blood in the hospital where he had undergone an operation, he commissioned an IEA publication called The Price of Blood which argued that altruism had failed and that blood should be exchanged in the market like any other scarce economic good.

One story perfectly captures Arthur Seldon's indifference to the swish of political power. Mrs Thatcher was one of the politicians of all stripes who called in at the IEA for occasional lunches. On one such visit a colleague of ours, pulling no punches, began to criticise her partial privatisation of British Telecom: by allowing only Mercury to compete with BT, and that in a few restricted markets, Thatcher had in truth increased the number of people with a direct interest in obstructing genuine liberalisation. She was obviously unused to such direct censure and bridled at the attack. Ralph Harris, ever the joiner, tried to pour oil on the waters by calling for "a toast to the best prime minister since Churchill". Arthur raised his glass and said, in a stage whisper: "I'll take a sip".

An indication of Seldon's standing among his fellow economists can be seen in the fact that, of the ten essays in The Unfinished Agenda, the festschrift I edited for his 70th birthday in 1986, no fewer than four were by Nobel prize-winners. One of them, James Buchanan, wrote that "Arthur Seldon has been able, more than most of us, to combine realism in prediction with continued idealism in vision." The combination produced some remarkable insights. In the early days of the IEA he warned that government would soon raid National Insurance pension funds to bail themselves out of more immediate political difficulties. In 1979 he foresaw that "Labour as we have known it will not rule again". And 1981 he predicted both that Soviet Communism would not survive the century and that China would go capitalist. His conviction that the state would eventually wither away as individuals took steps to avoid its intrusions has so far been proven accurate only in part. What can't be denied is that you have to go a long way to find anyone these days who seriously advocates socialism. And no single individual deserves more credit for that intellectual victory than Arthur Seldon.

MARTIN ANDERSON