His involvement in U.S. policymaking in China, where he directed Lend-Lease operations from 1941-1943, was one of the factors leading to his confrontation with Senator Joseph McCarthy. In 1949 he directed the first World Bank mission to Colombia.
Roger Sandilands had access to Currie’s own papers and to previously unpublished material. In this biography he provides the reader with a critical evaluation of Currie’s contribution to the literature on the theory and practice of economic development in general, together with an analysis of how his concepts were shaped during the New Deal and in post-World War II Colombia.
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The Life and Political Economy of Lauchlin Currie
New Dealer, Presidential Adviser, and Development Economist
By Roger J. Sandilands
Duke University PressCopyright © 1990 Duke University Press
All rights reserved.
The Early Years, 1902–25
Lauchlin Currie's life (1902–) spans most of the twentieth century. He has been a student and top-level teacher and practitioner of economics and public administration for nearly seventy years. His professional work has carried him to many parts of the globe. Born a Canadian in Nova Scotia in 1902 he later assumed U.S. citizenship in 1934 in order to accept a government post in the U.S. Treasury; and then in 1958, at a time when a naturalized U.S. citizen could not reside outside the United States for more than five years without losing citizenship, he was invited personally by the President of the Republic of Colombia–where he had married and been settled for some years—to assume Colombian nationality. Aside from four or five years as a visiting professor at various American, Canadian, and British universities, he has lived and worked in Colombia for most of the period since 1949 when he was appointed as the director of the first World Bank mission to Colombia.
His first exposure to higher education was as a student at St. Francis Xavier University in Nova Scotia in 1920. Many years later the celebrated economist Harry G. Johnson was to obtain his first teaching appointment there, but in the early 1920s the college could offer relatively little instruction in the subjects that were beginning to arouse the interest of the young Lauchlin Currie and he moved on to the London School of Economics in 1922 without obtaining a degree from St. Francis Xavier's. Sixty-six years later, in May 1988, that was to be rectified when the university awarded him a Doctor of Laws, Honoris Causa.
After graduating from London in 1925 he attended graduate school at Harvard where he remained to teach until 1934 when Jacob Viner invited him to join his "Freshman Brain Trust" at the U.S. Treasury.From there he moved with Marriner Eccles to the Federal Reserve Board where he was assistant director of research until his appointment in 1939 to the position of personal assistant to President Franklin Delano Roosevelt—thus becoming the first professional economist to work in the White House. During the 1930s he became, according to Herbert Stein's history of this period, the intellectual leader of the New Deal economists, developing—independently of the Keynes of the General Theory—both the theoretical rationale for unbalanced budgets and extensive statistical support for macroeconomic policies to combat depression.
During the Second World War he directed the Lend-lease program to China and made two important trips to Chungking in 1941 and 1942, meeting with leaders such as Chiang Kai-shek and Chou Enlai. He was also de facto director of the Foreign Economic Administration, 1943–44, and head of the American delegation to the Bern Conference in February 1945.
After a period as a private economic consultant in New York he was invited to direct the World Bank mission to Colombia in 1949–50. He has been a distinguished and often very controversial adviser, in a formal or informal capacity, to almost every Colombian administration since that time and is widely regarded as having done more than any other individual to promote serious thinking and policy on the economic development of that country. He has also written extensively for a wider, international audience on the theory and practice of growth and development and macroeconomics generally.
In the early 1950s he drafted some memoirs of his early life and work in the New Deal. However, these were never completed and never published, though copies were circulated and used by a few historians of the New Deal and wartime economic management such as Arthur Schlesinger and Herbert Stein. In drafting my own account and assessment of Currie's career after his arrival at Harvard in 1925 I deliberately ignored his memoirs, preferring to piece together first my own story from his published writings and unpublished speeches, memoranda, and correspondence in those years, together with contemporary records by other writers and the assessments of later historians. Only later did I check for consistency and completeness with the memoirs Currie wrote in 1952. I then incorporated a few passages into my own text.
For the early years, 1902–25, however, there can be no better record than the very personal account that Currie himself provided in his memoirs of the family and cultural influences on his early development as a child and student. I have, therefore, chosen to reproduce this material in its entirety. It is a revealing psychological self-portrait, and in 1952 Currie was reasonably well equipped to undertake an honest and objective analysis of self-development, having been closely associated for ten years after 1940 with some of America's leading psychoanalysts such as Harry Stack Sullivan, Erich Fromm, and Frieda von Reichman. Currie was for a time a member of the board of the William Alanson White Foundation (which established the famous Washington Institute of Psychiatry) in Washington and later was secretary of its New York branch. Also, he had himself undergone intensive and painfully revealing therapy for three or four months in 1945 with Benjamin Weiniger, on Harry Stack Sullivan's recommendation.
Currie's father had very successfully built up a fleet of merchant ships that sailed between Nova Scotia and the West Indies, South America, and Europe; but he had died when Lauchlin was only four. His mother was the greatest influence on his life, spurring him on to emulate his dead father, firing his ambition, and placing responsibilities on him as fast as he could handle them. She was an educated woman and, in a quiet way, strong and demanding. Years later, when her son informed her of his appointment as instructor at Harvard University, the news was greeted with characteristic nonchalance that indicated that she expected nothing less. Currie's life would, therefore, be an unending struggle to prove himself, to others but more especially to himself, and to fulfill his talents and the high expectations of those he himself held in high esteem. He would drive himself hard and expect the same of others. This is not always the recipe for harmonious relations but it is a necessary, if not a sufficient, condition for high achievement.
This biography is the story of those strivings and the results. It begins with Currie's own account, written in 1952, of the beginnings.
Currie's Memoirs: "The First Twenty Three Years"
Nova Scotia and California, 1902–22
I was born on October 8, 1902 on a cold foggy morning in a little fishing village called West Dublin on that side of Nova Scotia that fronts the Labrador Current. I was the last of a family of five and was apparently not particularly welcomed. No name had been chosen in advance and my father lost interest in his hobby of selecting boys' names with a middle name beginning with V (Verne, Victor, Vincent). Perhaps to justify his suggestion that I be given his name, he said that I looked so small and puny I probably wouldn't live long anyway. In any case, my mother long afterward told me that I had cried continuously for 3 years and that she thought I would never learn to walk or talk,—hardly an auspicious start. In fact, when I finally did learn to walk, my career almost came to an abrupt end first by my setting myself on fire and again by my falling off the edge of a wharf into the ocean. In both cases I was saved by my father. It is fortunate I had no further misadventures as after the second one, when I repaid him on our cold wet trek back to the house by throwing stones at him and blubbering that I wanted "Ma" to rescue me, he swore that I could save myself the next time —a not unreasonable response under the circumstances.
He was in many respects a remarkable man. He was left at the age of sixteen by the drowning of his father in Halifax harbor, with his mother and a brother and many sisters to support. With little formal schooling and with few local opportunities, he supported the family, gradually acquired a substantial fleet of sailing vessels and left us reasonably well off by the time of his early death when he was only 44, on the income of which we lived very comfortably for the next twenty years. Unfortunately, I was only four when he died so I have few independent recollections of him. I have always liked my mother's story accounting for his success. After his father's drowning, a malicious neighbor said with ill concealed satisfaction that now young Lauch Currie would have to go to work like the rest of them. When this was reported to my father he said, "111 be damned if I work" meaning/ of course, manual work, and never did. He also, curiously enough, hated the sea from which he did so well and would never sail with any of his vessels on the trade of salt codfish to the West Indies, South America and even Spain, with return cargos of rum, salt, molasses and sugar. He combined the business acumen of the Scottish with a Scottish weakness,— fondness for hard liquor, and it was undoubtedly this latter that contributed to his early death. According to the family historian, a cousin by the same name as I who became prominent in Nova Scotian political life, the Curries had been the hereditary bards (poets and musicians) for many hundreds of years to the Clan Ranald MacDonald and had fallen on evil days after the Battle of Culloden Moor when they took refuge in South Uist in the Hebrides. From there my grandfather emigrated to Nova Scotia as a boy, running away, it is said, from an unsympathetic stepmother.
My mother, on the other hand, was of predominently German stock, bearing a name that was later to become very well known,—Eisenhauer— though with what she insisted was the correct German spelling. The first Eisenhauer, in a party of German emigrants, had been settled in 1755 by a British promoter in a cold, inhospitable part of Nova Scotia which they called Lunenburg. When, in later life, I was much concerned with the problem of elevating standards of living, especially in lands more favored by Nature, I could not help marveling how my German forebears of two hundred years ago, in a land of rocks, hills and virgin forest where the efforts of three months a year must be devoted to the provision for the other nine, with little education or capital equipment, with primitive means of transport and harassed by the Indians, were able, in a very few years, to create for themselves a high standard of living in the essentials —health, food, shelter and clothing. It is certainly a tribute to the importance of the human factor in explaining a standard of living. With all this, they were able to maintain their religious fervor and a modicum of culture though they were almost entirely of peasant stock. My grandfather, for example, whose job was that of an expert sawyer—the man who hand sharpened all the various saws in a saw mill—, made and played a very fine violoncello in his spare time.
For better or for worse, my mother was unquestionably the dominant influence in my life. It was she who spurred me to emulate my dead father, who fired my ambition and placed responsibilities on me as rapidly as I could handle them. At the age of twelve I was harassing the very dear but not too practical executor of my father's estate (William E. Marshall) into raising interest rates on long outstanding mortgages and in checking on whether fire insurance policies on mortgaged properties had been kept up. I must have been quite a trial to the poor man, who actually had considerable renown as a poet.
It was also my mother who devised the system of providing me with pocket money. We had, shortly after my father's death, moved slightly inland and away from the fogs to the pleasant little town of Bridgewater, where I was to spend most of my boyhood. Everything that I could raise and sell from about an acre of ground was mine, even though my mother would, for example, buy the feed for the chickens. In this way, I had at least the illusion that I earned myself everything I spent.
My mother, a former schoolteacher, was an assiduous reader and I never lacked for books. For years I subscribed to The Boy's Own Paper—the beloved B.O.P.—and Chums from England, and to the Youth's Companion from the United States. I was probably of the last generation that read everything by G. A. Henty one could lay one's hands on. He was a prolific English boys' writer whose one hundred odd books covered practically every war in history. Although in reality they were rather tediously written, with long accounts of the disposition of forces in every battle, I have never been so enthralled by anything I read since. Even to-day, a mere memory of the titles —The Young Carthagenians, With Pike and Dyke, Under Drake's Flag and the others —still arouse a feeling of pleasureable excitement. The books were heavily moral in tone and invariably, in the case of the young hero, merit was richly awarded. After this rich fare, I found Horatio Alger and the Merriwell books rather tepid.
In view of my later and what most people may think my too facile changes in nationality, the influence of my early reading should not be overlooked. At that time, the paucity of strictly Canadian literature led me to read almost entirely English and American books and I was more familiar with those countries' histories than with that of my own. Thus, at a very early age, I felt almost as much at home in certain aspects of those two cultures as in Canadian. In the Maritime Provinces, again speaking of that time, we felt in many ways closer to New England than to the rest of English-speaking Canada, from whom we were separated by French-speaking Quebec. The movement between Massachusetts and Nova Scotia was sufficiently heavy to justify a steamship line and it was commonly said that there were more Nova Scotians living in Massachusetts than in Nova Scotia. I had an aunt and an uncle and numerous cousins living in Massachusetts and this was a common experience with many families. With my mother, I spent one winter in Worcester, and it was there, curiously enough, that I learned to do two things supremely important to me—to read and to skate. Later, at the age of sixteen, I was to spend a year in Redlands, California. Thus, by the time I went to study at Harvard and live in Cambridge, I went not as a stranger—an emigrant—but rather as a person returning to familiar surroundings. Similarly, when I went to study for three years in England I felt almost as much at home, although the marked difference in accents and little things like the different system of money will cause a Canadian, at least initially, to feel more a stranger in England than in the United States. In any case, it is apparent that at a young and impressionable age, I developed no excessively strong sense of nationality such as is normally experienced by, say, American children who share only unconsciously in the cultures of other nationalities. This is not to say that I was not a product of a particular culture at a particular time and will not remain so until my death but only that that culture did not happen to be very strongly nationalistic in tone.
In fact, I am still so much a child of a certain environment that I cannot conceive of better surroundings for a growing boy than a small town in the Maritime Provinces of Canada. The long winters were not a burden but a source of delight. The long winter nights, after the early supper at six o'clock, were a time to read near hot air registers. The woods came to the edge of town and continually beckoned a boy with a dog and a gun or a fishing rod or rabbit snares, depending on the season. One swam in the river and lakes in summer and skated on them in the winter. The exhilaration of a bobsled ride down a steep and often icy hillside can only be compared to skiing, which, unfortunately only came in after my boyhood. One knew everyone, young and old, and it is difficult to imagine how a child in a city can possibly have the same sense of "belonging"—of having one's roots firmly embedded in a particular place. When one went "downtown" to the Post Office, largely in the secret hope of catching a glimpse of a particular girl and maybe even speaking to her, one greeted and was greeted by everyone—one was Lauchlin Currie, the son of Alice Currie and the brother of Marguerite and Arthur Currie.
We were among the better-to-do, but there were few class lines. Nearly everybody was middle class, and although my mother did not invite workers or farmers to the house, we were friendly and I played with their children. It was not quite as idyllic as the condition described in Longfellow's Evangeline "where the rich were poor, and the poor had abundance" but almost. Two of my mother's closest friends were spinster sisters who had nothing. One was a dressmaker and one an expert cook. They both helped to prepare and then attended my mother's "parties" and no one thought anything of it. On Saturday mornings, market day, my mother would discuss many things with our particular farmer, with a complete absence of any condescension. In her eyes, a cardinal sin was "putting on airs" or snobbery of any sort. People were judged by their qualities, not by their money or social position. It was a sturdy, democratic community and the genesis of my later predilection for the New Deal and my indifference to social distinctions can probably be traced to this early environment.
Excerpted from The Life and Political Economy of Lauchlin Currie by Roger J. Sandilands. Copyright © 1990 Duke University Press. Excerpted by permission of Duke University Press.
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