Obituary: Wynne Godley

Published on Thursday 20 May 2010 21:20

Former musician who went on to become one of the Treasury's 'six wise men'

Born: 2 September, 1926, in London.

Died: 13 May, 2010, Suffolk, aged 83.

IN THE world of economics, Wynne Godley was a hugely influential and original thinker who made significant contributions to the advancement of macroeconomic theory.

His talent for macroeconomics also led to some unerring predictions of the downfall of the British economy. His list of job titles, professor of applied economics at Cambridge, treasury civil servant and contributor for the Times and Sunday Times, suggest that his authority was well respected.

Wynne Alexander Hugh Godley, the youngest of three children, was born in Paddington in 1926. His grandfather was Arthur Godley, a close friend and private secretary to Gladstone, and became Lord Kilbracken upon his retirement.

His father, a lawyer and the second Baron Kilbracken, had an unfortunate relationship with drink. This addiction and his relationship with another woman led to the break down of his marriage to Godley's mother.

The family home at Ashdown was not what you might call a hive of activity and Godley had a very lonely existence as well as severely lacking education and basic skills that most children have; he was frequently ill and it would be a long time before he learnt to dress himself.

As his mother was more often than not away from home, Godley was raised by nannies for his first ten years. On one trip into the forest he saw Christopher Robin Milne playing a cricket match.

At the age of seven, his father made him and his siblings wards of court and after seeing a judge in the chambers he was deemed fit for school. He was subsequently sent to Ashdown House, which he described as the "Chamber of Horrors", before being moved to Sandroyd in Cobham, Surrey.

Godley's recollections of Sandroyd were mixed; on the plus side he recalled excellent teaching but conversely a disproportionate number of beatings. He excelled in English and was offered 5 by his father if he could learn The Rime of the Ancient Mariner by Christmas, making it to verse 135 before being halted by the headmaster.

He had no interest in most sports but he did win the school golf and chess championships.

When he was 13, Godley moved to Rugby School and during this time he found great musical influence from two men in particular. The first was his music teacher, Kenneth Stubbs, and the second was William Glock, his mother's lover. As a result Godley became more than proficient in both the oboe and piano.

Godley's academic gifts earned him a place at Oxford, reading Modern Greats in 1943. His halls at New College were grand and in his room he had his mother's Steinway piano.

During his time at Oxford he was taught by the economist PWS Andrews and was also significantly influenced by Isaiah Berlin. Godley was talented and intelligent and was rewarded with a first when he graduated in 1947.

Upon graduation he continued his musical studies and the Conservatoire de Musique in Paris.

He remained there for three years, returning to England a professional musician and being appointed principal oboe of the BBC Welsh Orchestra in 1951. An unfortunate compliment to his great talent were spine-gangling nerves which left him crippled when performing on the public stage.

Eventually it all became too much. In 1954 he started his new career as an economist for the Metal Box Company.

He married Kathleen Epstein, daughter of Jacob, in 1955 at a time when his career star was rising fast. In 1956 he took up post in the Treasury's economic department, working primarily on macroeconomics. His work and passion for this area of economics led to his secondment to the National Institute of Economic and Social Research from 1962-64.

He rose through the ranks at a rapid pace and by 1967 he was the deputy-director of the economic section. In this role his calculations set currency devaluation that year.

During this time he also met Nicholas Kaldor, who was an advisor to the Labour government. Kaldor was impressed by Godley's talent and was instrumental in persuading him to take up the position of director of the Department of Applied Economics (DAE) at Cambridge. This was a controversial move at the time, as many Cambridge economists felt Godley lacked sufficient economic training. However, his talent shone through and Godley earned the respect of the other scholars. He was made Professor in 1980.

Godley had long tired of the short-term forecasting commonly seen in the Treasury and instead had begun to work on new theories to develop medium-term modelling. He argued that the foreign trade deficit depended on the size of the public sector deficit, with the exchange rate and economic competitiveness affecting output and employment.

His theory was unpopular, and the argument continues to this day. However, eventually it was shown to hold an important key to economic effectiveness, which had been previously cast aside.

During his time at the DAE Godley founded the Cambridge Economic Policy Group which, in its annual review, predicted the 1972 crash and the severity of the 1979 recession.

Godley published regularly, including articles and letters in which he commented on the most prevalent economic issues of the day and made predictions of future issues. In 1992 he was made a member of the Treasury's Panel of Independent Forecasters, know in the media as the "six wise men". The panel was formed after severe criticism of government economic policy and forecasts.

Godley then set his sights on the USA, concerned with the macroeconomic problems that were fast growing on the other side of the pond. He was a Distinguished Scholar at the Levy Institute in New York and had observed that macroeconomic imbalances in the USA had ramifications across the globe such was the size and strength of the US market.

Godley issued many warnings regarding a potential worldwide economic crash. His repeated assertions that unsustainable growth would eventually implode fell on mainly deaf ears until 2008, when his prophetic views came to being.

His love of music never waned and from 1976 to 1987 he was the director of the Royal Opera House. He was well known to tap his foot to music, and this became disconcerting when he was behind the wheel of a car.

He is survived by his wife Kathleen (Kitty) and his three daughters.