Arthur Seldon - An economist and polemicist, he co-founded the IEA and helped pave the way for Thatcherism

Alfred Sherman
Thursday October 13, 2005
The Guardian

The economist and writer Arthur Seldon, who has died aged 89, was one of a small band who, in effect, launched what eventually came to be known as the Thatcherite revolution. Together with the entrepreneur the late Sir Anthony Fisher and Ralph (now Lord) Harris, he founded the Institute of Economic Affairs (IEA) in 1957.

Seldon participated in the management of the IEA, particularly its vigorous programme of publications, and was its editorial director from 1957 until 1988. During that time the organisation evolved from barely tolerated fringe grouping to pillar of a new, or renewed, orthodoxy which prepared the ground for the politico-ideological Thatcher enterprise launched in 1979.

Seldon was a man of his age. Born in the East End of London during the first world war into the Jewish artisan class, and faithful to his Jewish roots, he was orphaned at the age of three by the influenza epidemic that swept Europe at the close of the first world war. He was adopted by a cobbler and his wife, attended Dempsey Street elementary school in Stepney, and was a state scholar at Raine's foundation school. Seldon benefited from the educational provisions of the time, which enabled him to make his way to the London School of Economics where, in 1937, he graduated with first class honours.

Fleetingly, in 1940, he worked with a Ministry of Information survey research unit, but then served in the army in Africa and Italy from 1942 to 1945. After the war, he edited the periodical Store, from 1946 to 1949, while teaching evening classes at the LSE - and from 1956 to 1966 was a staff examiner there. He was also from 1948 to 1949 chairman of a Liberal Party committee on the aged. From 1949 to 1959 he worked as an economist in industry - conducting industrial research - before and alongside his recruitment to the newly-founded IEA, Fisher's brainchild. At first he was a part-time editorial director, but soon it became a full-time post. Meanwhile Harris was appointed general director.

In that job as editorial director, Seldon was personally responsible for commissioning and editing a stream of booklets, periodicals and other publications that played a considerable part in modifying the climate of opinion in Britain. Authors published included Friedrich Hayek and Milton Friedman. The thoroughness and responsibility of this editing made it a heavy workload, but, in addition, he wrote more than two dozen books and 10 times that number of articles in newspapers and periodicals.

The general reader may remember him, and the IEA, best for their macroeconomic polemics. During three decades these transformed the mindset of policymakers and commentators. They were swayed from neo-Keynesian and statist certainties - which rejected disagreement and categorised "monetarism" as an eighth deadly sin - to a new consensus. This would indeed be called "monetarist", but that epithet had not then fallen into desuetude, together with the ideas which gave it birth.

However, Seldon's remit ran much wider. From the outset, he advocated what now would be called "compassionate conservatism". He demonstrated in a series of works that the working classes were in many ways the principal victims of socialism and welfarism. In 1957 he co-wrote Pensions in a Free Society, the IEA's first pamphlet. Two years later came Advertising in a Free Society, and in 1960 he co-wrote Pensions for Prosperity.
His picture of the working classes was a remembered one, of people capable of self-respect and self-help, but vulnerable to the massed battalions of power. It was in that same vein that he had devoted such attention to pensions. In The Great Pensions Swindle, in 1970, he issued many warnings, won many arguments but failed to bring about a reshaping of policies, as we are now learning to our cost.

Twenty years after the IEA set up shop, in 1979, Margaret Thatcher entered Downing Street to high hopes among her supporters. Unlike the US, where thinktanks - and the IEA was an early example - were brought into administrations favourable to their ideas, the IEA remained strictly outside government.

True, Ralph Harris was elevated to the House of Lords, but he entered as a crossbencher and remained friendly but critical of the government's achievements. Arthur and his wife Marjorie were particularly keen on the promotion of education vouchers, and had high hopes when Keith Joseph was moved in as secretary of state for education from Industry, where the civil servants trampled all over him. They were to be disappointed during Joseph's time at the department, from 1981 to 1986. The IEA won more arguments in theory than in practice, but Seldon kept writing. Corrgible Captialism, Incorrigible Socialism (1980) was followed by Wither the Welfare State (1981), Socialism Explained (1983), The New Right Enlightenment (1985) and The Riddle of the Voucher (1986).

His full-time appointment with the IEA ended nearly two decades ago. His Capitalism (1990) won the Fisher Prize in 1991, but by that time Thatcher had fallen, and six years after that the Conservative government fell in its turn.
But Tony Blair's incoming Labour government did little to turn the clock back where economic philosophy was concerned. Seldon continued to write for posterity, confident that the worst fallacies were behind, that the Treasury, the Bank of England, the economic ministries and employers' organisations were nearer the mainstream of neo-classical economics than they had been when the IEA had begun its uphill climb in the 1950s of Harold Macmillan and Hugh Gaitskell. If many of Blair's critics in the Labour Party and unions complain that his policies are Thatcherite, they might more accurately describe them as IEA-ite.

The IEA's distance from the Conservative party, unlike that of the thinktanks of the left, may have appeared disadvantageous during the heyday of Thatcherism, but it was seen as a boon as time went on. IEA scions command several economics faculties in the universities. The IEA remains active and, if not always actually accepted, at least respected and tolerated, and soundly financed.

After his retirement from the directorship Seldon was a consultant and then, finally, in 1990 he became a founder-president and remained one for the rest of of his life. In 2002 he published The Making of the IEA, and in 2004-05 a collection of his IEA work and material from other sources has been published in seven volumes by the American organisation the Liberty Fund.

Seldon's recreations were cricket, opera, and, as he wrote in Who's Who, "parties for non-conformists". His house in Kent, "the Thatched Cottage" is, in spite of its name, quite large, and surrounded by generous gardens. It has always been a centre of conviviality and conversation. In retrospect, it seems that whenever we gathered there for leisured colloquies, the sun always shone.

His personal life was happy and uneventful. He married Marjorie in 1948; she survives him. They had three sons, of whom the youngest, Anthony, has made a name for himself as biographer, educationist and headmaster of an independent school.

· Arthur Seldon, economist and writer, born May 29 1916; died October 11 2005