Lunch with the FT: Robert Skidelsky
By Lionel Barber
Published: August 28 2009 15:14 | Last updated: August 28 2009 15:14
We are meeting at Rules, a venerable English restaurant (est 1798) in Covent Garden, London. With its period cartoons and elegant portraits, Rules seems the type of place that Keynes might have frequented in his heyday in the 1920s and 1930s. Sadly, the world’s authority cannot confirm my hunch.
“Keynes was not a club man. I don’t know whether he ate at Rules. I’ll have to check my papers ... ”
Lord Skidelsky, 70, is deeply tanned – he’s just back from staying with his old Social Democrat friend Lord Owen in Greece – and his clothes are understated: a navy blue jacket, white shirt and a light brown chequered tie. He has just produced a new book on Keynes, a supplement to his three-volume biography completed in 2000.
There are numerous questions on my checklist, not just about Keynes and his relevance today but also Skidelsky’s public tirades against economists and the teaching of economics at university. But first I want to delve into Skidelsky’s background, a remarkable story in its own right.
Robert Jacob Alexander Skidelsky was born in Harbin, China, in 1939. His parents were British subjects of Russian ancestry, Jewish on his father’s side, Christian on his mother’s. His father worked for the family firm, LS Skidelsky, which leased a local railway line and the largest coalmine in Manchuria.
“The paradox is that the Skidelsky fortune, which was considerable, was lost twice over, first of all by the Bolshevik revolution, although they did get out $6m in cash, which was a terrific sum in those days,” says Skidelsky. “But then my grandmother, who was in charge of the money because her husband had died, decided to increase her fortune round about 1929 by gambling on the New York stock market on the margin – you were allowed, I think, 10 or 15 per cent then – and lost everything, bar bits and pieces.
“My father, who had been, I suppose, looking forward to a comfortable life as a playboy in western Europe, went back to Manchuria – this was after the crash, the Great Depression in 1931 or thereabouts – in order to work in the family coal business, which was still flourishing. That’s where he met my mother and I was the result of that.”
In 1941, when war broke out, the Skidelskys, including four-year-old Robert, were interned by the Japanese but were released some months later in a prisoner exchange. The family returned to China after the war, just as Mao’s communists seized control of Manchuria in 1947. “It was”, Skidelsky admits, “a spectacular piece of bad timing.” Two years later, they gave up hope of reclaiming their property and returned to Europe. He was sent to Brighton College.
ROBERT SKIDELSKY ON THE PAST 10 YEARS
‘I was too weak to be a leader, too strong to be a follower’
In the past 10 years my life has broadened out in various ways, chosen and unchosen. The most important development, autobiographically, has been the deepening – or possibly resumption – of my links with Russia. I have for some years now been on the advisory board of Lena Nemirovskaya’s Moscow School of Political Studies. I have devoted considerable time to learning Russian, a language my parents discouraged me from taking up in childhood when it would have been much easier for me to do so.
The benefit of the extinguishing of my hopes of a political career was that it enabled me to finish volume three of Keynes far quicker than I would have done otherwise.
I left the Conservative party for the Cross Benches in October 2001. Reflecting on my lack of success in politics I concluded that I was too weak to be a leader, too strong to be a follower. Although I am independent-minded, it is not true that I am incapable of being a “team player”. I think I would have been a good minister, and regret my failure to gain an insider’s knowledge of the working of governments.
A new twist to my life came in 2001 with my appointment as a non-executive director of Stilwell Financial, a holding company which owned Janus, a large American mutual fund. A review essay I had written in the New York Review of Books of Francis Wheen’s life of Karl Marx attracted the attention of its chief executive, Landon Rowland. He immediately invited me to join the board. I believe this could only happen in the US. In the UK nothing I have ever written or done has suggested to anyone that I might be suited to money-making! I am now a non-executive director of Janus Financial Company and of Sistema Joint Stock Company, which owns the Russian telecoms company MTS. I have also served as chairman of the Greater Europe Fund, a Jersey-based hedge fund.
These different worlds have continued to fertilise my writing. My business experience gave me an insight into the financial system, crucial in writing my latest book, Keynes: The Return of the Master, an account of Keynes’s ideas set in the context of the global economic recession. My flirtation with politics informed another short book, completed in 2008, about Britain in the 20th century.
I am working with Vijay Joshi, Fellow in Economics at Merton College, Oxford, on a book on globalisation and international relations. It will aim to sort out the sense and nonsense of globalisation, and consider how far contemporary economic and political logics point in the same direction. These are themes which link my various intellectual interests in a most satisfactory way.
This tale of woe is halted by the arrival of a waiter. I order potted shrimp, followed by steak and kidney pie. Skidelsky orders pea soup and grilled liver. I ask whether this topsy-turvy childhood encouraged him to study the interwar period and the Great Depression. “Well, that was the period that crucified our family, but it was also virgin territory. History at Oxford [where he gained a place after Brighton College] stopped at 1914.” At Oxford, he became fascinated by the relationship between politicians and the economic slump in Britain, which became the subject of his PhD thesis.
It was an interest that rapidly became an obsession, driven by his friendship first with his Oxford contemporary Max Mosley and then with the whole family: Oswald (the former Labour cabinet minister who later formed the British Union of Fascists) and his wife Diana (née Mitford).
Skidelsky says he still sees Max Mosley, now clinging to his job as head of Formula One motor racing after tabloid revelations about his sexual antics. Then, lowering his voice, he speaks of his own “calf-like” love for Max’s mother and his fascination with Oswald, a “brilliant, charismatic man” who resigned from the government in 1930 calling for a break with orthodox economic policy to combat high unemployment.
Skidelsky saw him as a figure of history rather than demonology, and in Oswald Mosley, the biography he published in 1975, described his subject as “a hero”. However, the book cost him tenure at Johns Hopkins University in the US and at Oxford – though he did, finally, win a permanent post at Warwick University in 1978. Why was he, I ask, so indulgent toward Mosley, with his fascist views and his anti-semitism, given his own Jewish background?
“Half-Jewish,” he says, gently correcting me. “I believe strongly in loyalty but I was also drawn intellectually .”
Skidelsky now views his obsession with Mosley as a “false trail”. At any rate, it was replaced with a new interest-cum-obsession, this time with Keynes. “He was the real thing: [he had] a high intellect and a sense of balance. He was Eton, Cambridge, and HM Treasury, with a country place [Tilton, East Sussex, which Skidelsky leased for 20 years while completing his biography]. He was a member of the intellectual aristocracy. He was an insider and an outsider.”
Skidelsky clearly envies Keynes’ ability to have been part of the Establishment but also one of its most trenchant critics, especially at such seminal moments as the government’s decision in 1925 to return to the gold standard. The theme of insiders and outsiders will recur during our two-and-a-half hour lunch.
I ask Skidelsky whether he was naïve in failing to anticipate the criticism of his Mosley biography. Perhaps, he replies. His decision to embark on the definitive study of Keynes was a riposte. “I said to myself, ‘I will show the buggers.’ ”
Now, however, Skidelsky wonders aloud whether he lacked courage. “Not physical courage because I never had a chance to fight; more moral courage. I was too eager to please and, when there were fundamental disagreements, I was always looking for a compromise.”
Just as our conversation is turning confessional, the waiter arrives with our main courses. Skidelsky pauses and says: “May I ask you a question: was it necessary to be an economist to be editor of the Financial Times?” I temporarily choke on my (excellent) steak and kidney pie. There is no pre-condition for the editorship, I tell him, beyond displaying an interest in and understanding of the “dismal science”. The answer satisfies him.
Skidelsky does not appear to like economists very much, I say. “Not true. But there is an imperial benevolence about them; they are not interested in people, they are very impersonal. I cannot imagine having a bosom friend who is an economist.”
But when we turn to Keynes, Skidelsky’s face lights up as he describes the many-sided genius. “He was a wonderful writer on economics, the best there has ever been. Some people say a better writer than a thinker. Wrong. He used a rhetorical logic, à la Aristotle.”
To illustrate his point, he compares the writing of David Ricardo and Thomas Malthus, two early 19th-century English scholars of political economy. “Ricardo liked to avert his eyes from the temporary to contemplate the long-term equilibrium that is evolving; Malthus focused on temporary disturbances which could have huge costs. Keynes agreed.”
Skidelsky, himself a fine writer, recites one of Keynes’ most famous quotes. “The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy a task ... if they can only tell us that when the storm is past the ocean is flat again.”
Like the Queen, Skidelsky believes economists missed the danger signs ahead of the financial crisis. They were preoccupied with sophisticated mathematical models – a serious weakness, he says, in academic teaching of the discipline – and they were over-confident in self-regulation of the market.
He blames this mindset on the revival of anti-Keynesianism in the 1970s when government intervention in the economy made way for supply-side theory of tax cuts and labour market deregulation. But Keynesians, too, were guilty of overreaching: they assumed the state was capable of fine-tuning demand to mitigate the effects of the economic cycle. Today, Keynesianism has reasserted itself through multi-billion pound government interventions to stimulate the economy and recapitalise the banking system. Skidelsky is no statist but he says the crisis has exposed serious weaknesses in economic policy, from the Bank of England’s inflation targeting (“They did not have the tools”) to the Labour government’s belief in light-touch regulation.
The waiter arrives with a dessert menu. We both opt for sorbets. I return to Skidelsky’s own politics, suggesting, playfully, that he has been as politically promiscuous as Keynes was sexually. “Promiscuity takes several forms,” he replies; “I like the French slogan: ‘Yes to a market economy, no to a market society.’”
He refines his position. “I don’t think I [have] moved very far, even if I moved farther than some. I have always been in the centre, not an extremist, though one break towards extremism was support of Mrs Thatcher.” Surely it is unfair to cast Mrs T as an extremist. “Well, no. And I did not declare my support for her.”
A mildly embarrassed silence follows. Skidelsky goes on to describe his journey from Labour to founder member of the Social Democratic party in 1981 to Conservative peer in 1992 but now sitting on the cross benches. In the run-up to the 1992 general election, with the SDP dissolved, prime minister John Major was looking for endorsements. David Owen, SDP co-founder, was top of the list but Owen wanted to join a government of all talents rather than signing up as a Tory. By Skidelsky’s account, part of the deal was that Skidelsky would receive a peerage.
Owen, he says, held out the prospect of a front bench role for his friend and a future ministerial post. But “God’s fifth column” – a Skidelskyian phrase for fate – sabotaged that ambition. In fact, he sabotaged it himself, joining a committee on education reform chaired by the minister John Patten, only to resign after a year: “I said I would not serve on an advisory committee if my advice was never taken.”
Skidelsky served as a front bench opposition spokesman on culture and treasury matters between 1997 and 1999, but then stepped out of line again, denouncing, in a Sunday newspaper, Nato’s bombing campaign in the Kosovo war. William Hague, then Tory opposition leader, sacked him. Surely, the sacking could not have come as a surprise. “Good question ... my article triggered hundreds of letters. But I did not say this out of moral courage. If David Owen had said, ‘Cool it,’ I might have done.”
There is a disarming honesty about the professor. The charge of naivety rankles but he is more interested in the tension between political calculation and principle. “I am not a calculating person. That is why I like Keynes, who said, ‘If the barometer is high and the clouds are black, don’t waste time on a debate on whether to take an umbrella.’”
Calculation, he says, is overestimated as a guide to rational conduct. Thus he is critical of Tony Blair (a tactician with an appetite for power) and admiring of the former Chancellor Kenneth Clarke, a man of principle whom Skidelsky believes could have been Conservative leader had he compromised on his support for Europe.
I am conscious that it is getting late. Skidelsky apologises. “When you get older you have a tendency to babble ... At 70, what does life hold in store?”
In fact, the professor does have plans: two books on globalisation, including a history of the Skidelsky family. The second will offer a fresh perspective on his chosen period and his own life as an outsider who, thanks to Keynes, came in from the cold.
‘Keynes: The Return of the Master’ (Allen Lane £20) is published on September 3 and is available at www.ft.com/bookshop (tel 0870 429 5884) for £16 plus p&p
Lionel Barber is editor of the FT
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Rules
Maiden Lane, London WC2
Asparagus and green pea soup (cold) £7.50
Morecambe Bay potted shrimp £11.95
Grilled liver & bacon with spring onion mash £19.95
Steak & kidney pie with runner beans £17.95
Bottle of sparkling water £3.75
Sorbet x 2 £15.00
Pot of peppermint tea £3.15
Coffee £3.15
Total (including service) £92.70
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