Monday, February 8, 2010

Lord William Rees-Mogg on Sound Money, Austrian Economics and British Government Reform

The editors of The Daily Bell are pleased to present an exclusive interview with legendary London Times editor, Lord William Rees-Mogg.

Introduction: Former London Times editor Lord William Rees-Mogg attended Charterhouse and Balliol College, Oxford and was President of the Oxford Union in 1951. He became a writer for The Financial Times in 1952, and then moved to The Sunday Times in 1960. He was first Deputy Editor and then editor of The Times (from 1967 to 1981). He was also a member of the BBC's Board of Governors and chairman of the Arts Council, With James Dale Davidson, he authored such popular, free-market oriented books as The Sovereign Individual, The Great Reckoning, and Blood in the Streets. He is Chairman of The Zurich Club and also of the London publishing firm Pickering & Chatto Publishers.

Daily Bell: Thanks for speaking to us. We appreciate the opportunity to ask you questions.

Rees-Mogg: My pleasure.

Daily Bell: How did you become interested in free-markets and economics?

Rees-Mogg: I became interested in economics and history when I was in University. Later I became more interested in the free market and economics because of the monetary strain of what you would call Keynesian economics. This was mustered to deal with the growing pressure of inflation in the 1960s and more in the 1970s, and to explain them. The longer that these pressures went on, the more dissatisfied I became with the explanations of economics, which I had previously accepted.

Daily Bell: Fill us in some more on your career and professional interests.

Rees-Mogg: I went to the Financial Times in March 1952 after coming back from Oxford and doing an American debating tour. By 1955, I was named the principal leader writer for the Financial Times. After having done a spell in the Parliamentary lobby, that naturally developed my interest in the questions of economic policy.

Daily Bell: Would you characterize yourself as an Austrian economist?

Rees-Mogg: Yes. I am an Austrian economist more than anything else. I knew Friedrich von Hayek and liked him very much. I don't say I went as far as he did but I was very sympathetic to his point of view.

Daily Bell: Is it hard to be pro-free-markets in Britain these days?

Rees-Mogg: No, I don't think so. I think the majority of people who are connected to the more right wing view of politics or the liberal view of politics in the old sense, would describe themselves as pro free market. I think people are more reflective. That is to say, these were great battles that were fought, and they are more apparent when we have had a major recession. The gaps between what Keynes thought , and what Milton Friedman thought, is much less wide than we used to assume.

Daily Bell: Why isn't the British House of Lords more pro-free-market? Or is it?

Rees-Mogg: Well the British House of Lords is a rather elderly body of people. You are appointed for life, and usually get appointed in your early 60s and therefore they are a generation of people who learned their economics from Keynes. Keynesian ideas are still reacting in essence to the subjects at hand in the 1930s. So you have a fair number of Peers whose ideas belong to the Keynesian theory. Then you have people such as Nigel Lawson, who is an ex-Chancellor, who is a free market economist.

Daily Bell: Why is there so much corruption in the British political system?

Rees-Mogg: I don't think there is more corruption in the British political system than there is on average in others. The reason that a particular kind of corruption or near corruption evolves was that the government of the day, and this goes back to the 1960s, thought it would be better to give pay increases to members of parliament in terms of expense allowances rather than in terms of salary increases. This was done in order to avoid having to make concessions to trade unions on various issues. It started in the 1960s when Harold Wilson was the Prime Minister. I don't think people realized that this would come to be regarded as money that belonged to Members of Parliament to be spent how they wished. Suddenly that was how it was administered, and the Members of the House of Commons who drew on these allowances had the idea that this was their own money. I think that is the explanation of why there is that particular scandal.

Read the full interview here.


  1. "Yes. I am an Austrian economist more than anything else. I knew Friedrich von Hayek and liked him very much. I don't say I went as far as he did but I was very sympathetic to his point of view."

    Can you really be an Austrian while thinking Hayek was too extreme?

    Where does Rees-Mogg depart? You have to be quite statist to be more statist than Hayek.

  2. LOL. This is one of the few websites where you will hear Hayek referred to as a "statist."