The Generations of Economic Journalism

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When I compared Robert Bartley to Walter Lippmann the other day as having been the most influential economic journalist of his age, I soon realized that hardly anyone knew what I was talking about.  Bartley (1937-2003) for thirty years had been editor of the editorial page of The Wall Street Journal. Many people remember him and sense his influence in the present day.

But Lippmann? Born in 1889, he wrote a widely syndicated newspaper column between 1931 and 1967, and died in 1974.  Ronald Steel’s celebrated biography Walter Lippmann and the American Century (Little Brown, 1980) won a National Book Award, the National Book Critic’s Circle Award, and the Bancroft Prize, and Steel’s vision of Lippmann is the way that most people remember him – an influential journalist who for fifty years wrote about foreign affairs.

Most people haven’t read Walter Lippmann, Public Economist, by Craufurd Goodwin (Harvard, 2015).  I have, and the book opened an important new window on an age for me. I figured I had better go back and acquaint EP readers with the story.

Born in Manhattan to wealthy parents whose families had emigrated from Germany in the turbulent 1840s, Lippmann attended Harvard College and quickly acquired a reputation for brilliance. Having begun a conversation with him in a museum, Isabella Stewart Gardner guided him one summer around Paris. He graduated in 1912, a protégé of George Santayana, William James, Charles Townsend Copeland, and Graham Wallas. The latter dedicated The Great Society to his student.

Lippmann worked briefly as a leg-man for muckraker Lincoln Steffens, before joining the editorial board of the start-up New Republic. His first book, a paean to the infant academic enterprise of social psychology, was published in 1913 as A Preface to Politics.  Sigmund Freud arranged for it to be reviewed in Image. Theodore Roosevelt read it on vacation in Brazil and began a warm friendship with the author. Woodrow Wilson read it and in 1917 hired him as a war planner and two years later took him to the Paris peace talks as an aide. It was in the course of going to budget meetings together that Lippmann got to know Assistant Secretary of the Navy Franklin Delano Roosevelt.  Of his subject Steel wrote:

His life was a panorama of virtually everything that happened to America during the twentieth century: Bull Moose progressivism, Greenwich Village modernism, saving the world for democracy, the Jazz Age and “normalcy,” Teapot Dome and the Lindbergh baby, the New Deal, Stalin and Hitler, the cold war, Kennedy’s Camelot and, topping it all … the Vietnam War, which Lippmann passionately opposed.

The reviews of Steel’s book emphasized an elusive quality to Lippmann’s thought over the years.  Having begun as a socialist and identified as an institutionalist or a progressive in his youth, he became known as a realist for his newspaper columns, “Today and Tomorrow,” after 1931. Yet his politics seemed to swing back and forth. In a review, “The Mysteries of Mr. Lippmann,” Anthony Lewis, of The New York Times, noted that Lippmann dispensed advice freely across the political spectrum.  He had

advised Wendell Willkie in the 1940 campaign, told Harry Hopkins before the 1944 convention that Henry Wallace had to go as vice president, worked with George Kennan on how to organize and sell to the public what became the Marshall Plan, sent memoranda to John Foster Dulles when in 1948 he seemed about to become secretary of state, drafted a foreign policy speech for Thomas E. Dewey that same year, worked with eastern Republican leaders in 1952 on how to get General Eisenhower into the race, advised the Adlai Stevenson campaign in 1956 on how to beat Eisenhower, and was consulted by John F. Kennedy on whom to pick as secretary of state. (McGeorge Bundy, Lippmann suggested, or Senator J.W. Fulbright; Dean Rusk was “a profound conformist.”) And his intimacy with the great was not limited to politicians. He was a companion of Thomas Lamont and other men of high finance, on the golf course and on European tours. In 1931 his friend William Allen White, the Kansas editor, warned him: “Watch your step. Don’t let the Bankers get you.”

Steel himself, in “The Biographer as Detective,” wrote:

Why did, for example, the young man who served Woodrow Wilson enthusiastically and drafted most of the Fourteens Points so vehemently denounce the Treaty of Versailles in 1919? Why did the former Fabian Socialist become so conservative in the 1920s and 1930s? –but become less conservative as he grew older? Why did he excitedly support Franklin D. Roosevelt in 1932 and then turn violently against the New Deal only three years later?

The answer, I learned from reading Goodwin’s book, had much to do with the friendship Lippmann formed in 1919 with a counterpart junior negotiator at the treaty talks in Paris, John Maynard Keynes.  Both were critics of the ensuing treaty. Ten years later, the calamity of the Great Depression became paramount for both. Reasoning matters through on his own, then with dawning recognition of the English economist’s contribution, Lippmann in the 1930s became the principal interpreter to the literate public in the United States of what eventually came to be known as the “Keynesian revolution.”

Lippmann gave the prestigious Godkin Lectures at Harvard in 1934, “The Method of Freedom.”  Keynes’ influence is evident throughout, according to Goodwin, in Lippmann’s ideas about “free collectivism,” a balance between the US government’s responsibility for managing the business cycle, on the one hand, and the liberty and competitive instincts of citizens, great and small, on the other. One chapter of the little book that eventuated is even titled “The End of Laissez Faire.” Keynes’ name doesn’t appear in the book, Goodwin writes, for one reason or another (a row developed soon when Harvard failed to recognize Keynes with an honorary degree at its gala Tercentenary celebrations in 1936), but by 1937, Lippmann wrote in his column,

The man who more than any other living person to develop a scientific basis for this policy, and to popularize it, is Mr. John Maynard Keynes. Few economists have ever exerted as wide an influence on practical affairs in their own time.

By then, Lippmann had become highly critical of the preoccupation with bureaucratic planning in the wake of Roosevelt’s landslide reelection. The New Deal now threatened civil liberties and free markets, he wrote in 1937.  American progressivism

…was in the hands of inexperienced and short-sighted zealots who, unless they were soon checked, were destined to discredit progressivism and to provoke a violently reactionary temper: and that in the ensuing conflict the ruthlessness of the Right would be much more than a match for the ruthlessness of the Left.

That same year Lippmann published his most important book, The Good Society, a draft of which appeared first in The Atlantic Monthly.  Today, its exposition of the virtues of decentralized markets against the tendencies to inefficiency of central planning is perceived as one of the founding documents of what has come to be known as “neoliberalism.”  Lippmann acknowledged the influence of Austrian economists, including Ludwig von Mises and Friedrich Hayek; he advocated Keynesian macroeconomic policies as well. Thinkers including Hayek, Lionel Robbins and even cranky Frank Knight praises on the book.

A gathering to celebrate was it was organized in Paris in August 1938, the Colloque Lippmann.  After World War II, many members reorganized themselves into the Mont Pelerin Society, an association of conservative thinkers including Hayek, Milton Friedman, George Stigler and many others, but pointedly not Lippmann. The organization’s genesis has been painstakingly described in The Great Persuasion: Reinventing Free Markets since the Depression (Harvard, 2012), by Angus Burgin, of Johns Hopkins University.

Thus in Walter Lippmann: Public Economist, I had found the answer to a riddle that had puzzled me whenever I got to thinking about the years after World War II.  Every time I went looking for a Keynesian evangelist in the period, I found mainly critics, especially journalists who had attended the first Mont Pelerin meeting, Henry Hazlitt and John Davenport.  Economist John Kenneth Galbraith entered the lists as a popularizer of Keynes in 1953, with American Capitalism: The Concept of Countervailing Power, and especially after 1956, with The Affluent Society.  It turns out, though, that among journalists, Walter Lippmann had been the godfather of the Keynesian understanding of what we still call “the modern mixed economy.”  He had made the sale before the war. Afterwards Lippmann turned his attention to America’s place in the world.

Not until the 1960s did the leader of a new generation of economic journalists emerge. Leonard Silk (1918-1995), with a PhD from Duke University, had started at Business Week in 1954; he didn’t join The New York Times until 1970. But with the publication OF The Research Revolution (McGraw Hill, 1960), with its introduction by Harvard’s Wassily Leontief, Silk had become the primary interpreter of the successes and failures of the “new economics” for the next generation. He continued until his untimely retirement in 1993. In 2000, the Times hired economist Paul Krugman in a very different capacity. By then, of course, Robert Bartley, had reached the zenith of his influence as editor of “the Page,” as the editorial pages of The Wall Street Journal were commonly called.

Does my claim to the comparability of Bartley to Lippmann seem fanciful to you?  It did to me at first.  Their beginnings could scarcely have been more different. Where Lippmann went to school at Harvard, Bartley came from Iowa State University, an agricultural school in the heart of the Midwest (whose faculty, it must be added, had earlier contributed Theodore Schultz, D. Gale Johnson, and George Stigler to the University of Chicago). Where Lippmann had brought Freud and Keynes to a wider audience, Bartley popularized the views of Robert Mundell, of Columbia University (later a Nobel laureate), and his student Arthur Laffer.

Yet my claim rests on the bedrock of what I expect will continue to be understood as the two great crises of the twentieth century in America – the Depression was one, the pervasive unrest at the end of the 1970s the other – and the political leaders who seemed to take possession of them.  Author Jacob Weisberg is correct, I think, when he writes, in Ronald Reagan (Times Books, 2016), his contribution to the Schlesinger series of presidential biographies, that “Ronald Reagan stands today as the second-most important president of the twentieth century, following Franklin D. Roosevelt, who was his first political hero.” Accept that judgment and you quickly find your way to the two most important economic journalists of their respective eras, Walter Lippmann and Robert Bartley.