One of the icons of international economics, John Williamson, passed away in April of this year. I had the honour of being invited by the family to say a few words about John as a colleague at his Memorial on Sunday, 7 November 2021 at "Hemlock Grove", Woodend, Audubon Naturalist Society, where John volunteered (he was a very keen birdwatcher). The following is what I said.
In an age in which fundamentalism no longer slips between the shadows, but openly stalks the pastures of thought, and even the ramparts of Capitol Hill, John Williamson could be counted on to be the grown-up in the room.
He was seldom ‘black or white’ in his thinking. He revelled in the grey. In the nuance. He was neither ‘Dirigiste’ nor ‘Laissez-Faire’; neither fixed nor floating; neither full nor anti capital mobility. He made the case for the intermediate, to paraphrase one of his papers (Williamson 2007). His was a Golden Mean; between two vices or two corners if you may.1
He did not set out to arrive at balance, for the sake of balance. He was more considered than that. He got there in active pursuit of the right solution to the right problem given the time and place. He was the consummate problem-solver and understood the problem in the round of politics, economics, and institutions.2
Which is why he cared so much about refining an idea, always trying to make it better, more suited to time and place. And which is why too, his contributions seem so varied. They are spread across the critical problems of the day, which did not always arrive in logical order.
When in the 1970s, Bretton Woods collapsed into the ‘Non-System’, as he called it, he wrote about the reform of the international monetary system and later its failure (Williamson 1977). And played more than a bit part too in the development of ideas at the time.3 He was a lanyard-carrying member of the Second Row Club – that group of senior officials who sat behind their ministers trying their best to advise and nudge them to greater ambition during the day, and drowning disappointments with laughter and drink in the evenings.4
When the newly floating exchange rates were stretching their muscles and exploring their limits in the 1980s and 1990s, he wrote about and developed new exchange rate arrangements (Miller and Williamson 1987). For instance, he and Fred Bergsten played a significant role in the ‘reference rate’ design of the Louvre Accord of February 1987 that tried to stabilise the dollar – an effort thwarted by the October 1987 stock market crash.
When Asia arrived, the Berlin Wall tumbled, and Latin America found its footing, he wrote about transition, development, and, of course, the Washington consensus around such matters (Williamson 1990). And when commercial debt to middle-income countries emerged as an intractable problem, he wrote in praise of new instruments that could better share the risks between borrower and creditors, like GDP-linked bonds (Williamson 2017, Benford et al. 2018).
So far, I may have given the impression that his work was largely responsive, but in truth it was just as anticipatory. My recent proposal here on Vox for the regular issuance of $500 billion of Special Drawing Rights (SDRs) in order to support the huge investment required to halt climate change (Persaud 2021), in its design, owes a debt to John Williamson’s earlier Vox column on the desirability of regular issuance of SDRs (Williamson 2009).
In the early part of my career, I was a foreign exchange analyst, trader, and later fund manager. I had of course come across John’s work while an economics student at the LSE in the 1980s. The Open Economy and the World Economy (Williamson 1983) was on the reading list of my favourite course, Charles Goodhart’s ‘Economic Policy’. But I really learned the worth of his ideas while as an economic practitioner. I will always remember that mad afternoon of 1 August 1993, when amid a massive market attack, the European authorities announced the widening of narrow fluctuation bands to cavernous 15% bands. It was a moment of market triumphalism. And under the glare of cameras and demanding editors, I pronounced boldly and grandiosely that these new bands were too wide to matter and that in reality this move marked the end of the European exchange rate mechanism. Only, to be a taught over the next few months the Williamson-Miller lesson on the stabilising properties of wide target zones, written four years previously (Williamson et al. 1989).
Few economists understand the wiles of the foreign exchange markets and fewer still as much as John did (Frankel 2021). And while he is known more for coining the phrase the ‘Washington consensus’, most of his writing was about exchange rates. From the unusual position of an economist once living in the foreign exchange trenches, I continue to believe that John had it more right than not. An intermediate solution, especially for mid- to small-sized economies, was more appropriate than laissez-faire.
John did not stand on ceremony and though he was my senior, it was the nature of the man that we crossed paths in many meaningful ways.
I discovered one connection only yesterday as I was leafing through my collection of his work. The discussants in one of the first outings of his “Washington Consensus Revisited” paper (Williamson 1997) was Frances Stewart and my late father, the development economist, the Honourable Bishnodat Persaud. I read my father’s review for the first time, with a little trepidation, worrying that I would discover some major disagreement between John, him and I. But I did not.
I was instead reminded that they were friends, and how that generation of economists wrote so elegantly and, well, economically. It made sense that they were friends. They shared a market orientation while understanding its limit and both were modest, gentle men. I was struck in reading this review and work 24 years later how courageous both were, pressing back against the easy, seemingly virtuous, consensus of the day, with grace. Courage with grace might have been their motto.
We first met across the conference table, invited onto the same panels during different foreign exchange crises and in different cities almost 30 years ago. We quickly found friendship. We also shared that rare space of believing in both the benefits and deficiencies of markets, while caring about global welfare.
Soon after we stumbled across each other as members in the gallery of the Reform Club, 104 Pall Mall, and discovered over a glass that we shared other niche pursuits. He was quintessentially English in many ways, but he was a globalist not nationalist. We shared humanist beliefs. We both love cricket. He had seen the greats play: Hutton, Compton and May and from my native West Indies, Sobers and the ‘Three Ws’. We shared a very fond admiration for that master commentator on “Test Match Special”, John Arlott, who also wrote for John’s beloved The Guardian.
John was an abiding liberal and was passionate about the condition of humanity and especially those less fortunate than ourselves. It was a driver of his work. There is something about his economic philosophy, his search for solutions in the grey, his non-fundamentalism, his grace, his firm yet gentle articulation, the courage of his ideas, that reflect on John the man. He was as a human being, colleague and friend, considerate, gentle, and generous but also courageous.
I have benefitted greatly in my economic life from the support and encouragement of a few greats, and John was one. It was much valued and is too rare in our profession. He taught me how to pay it forward.
Almost all of my close colleagues and writing companions considered John a friend and on speaking to them before I travelled to this memorial, I was struck by the common thrust of their thoughts and mine. We feel deeply indebted to him intellectually. But we feel even more than that, John touched us as a human being. Thinking of him we cannot help breaking out in a smile, remembering some shared joke, a funny moment, his own broad smile, his kind face and twinkling eyes. We shall miss him. But these shared memories, warmth and ideas live on. He is and shall always be our friend.
Endnote: John Williamson, 1937-2021, was a senior fellow at the Peterson Institute for International Economics, in the United States, from 1981 to 2012. He was project director for the UN High-Level Panel on Financing for Development (the Zedillo Report) in 2001 and on leave as chief economist for South Asia at the World Bank during 1996-99. He taught as an economics professor at several universities, including Pontifḯcia Universidade Católica do Rio de Janeiro, University of Warwick, Massachusetts Institute of Technology, University of York and Princeton University. John was also adviser to the International Monetary Fund (1972-74); and economic consultant to the UK Treasury (1968-70).
Benford, J, J D Ostry and R Shiller (eds) (2018), Sovereign GDP-Linked Bonds: Rationale and Design, CEPR Press.
Frankel, J (2021), “What three economists taught us about currency arrangements”, VoxEU.org, 1 May.
Miller, M H and J Williamson (1987), “Targets and Indicators: A Blueprint for International Coordination of Economic Policy”, Policy Analyses in International Economics No. 22, Institute for International Economics.
Persaud, A (2021), “Saving Paris: An economically efficient and equitable rescue plan”, VoxEU.org, 2 November.
Truman, E (2012), “The International Monetary System or ‘Non-system’?”, in C F Bergsten and C R Henning (eds), Global Economics in Extraordinary Times: Essays in Honor of John Williamson, Institute for International Economics.
Williamson J (1977), The Failure of World Monetary Reform, 1971-1974, Nelson & Sons.
Williamson J (1983), The Open Economy and the World Economy: A Textbook in International Economics, Basic Books.
Williamson J (ed.) (1990) “What Washington Means by Policy Reform”, in Latin American Adjustment: How Much Has Happened, Institute for International Economics.
Williamson J (ed.) (1994), “The Political Economy of Policy Reform”, Institute for International Economics.
Williamson J (1997), “The Washington Consensus Revisited”, in L Emmerji (ed.), Economic and Social Development into the XXI Century, John Hopkins University Press.
Williamson J (2007), “The Case for an Intermediate Exchange Rate Regime”, Singapore Economic Review 52(3): 295-307.
Williamson J (2009), “The case for regular SDR issues: Fixing inconsistency in balance-of-payments targets”, VoxEU.org, 2 October.
Williamson, J (2017), GDP-linked bonds, Palgrave.
Williamson J, with MH Miller and P Seller (1989), “The Stabilising Properties of Target Zones”, Warwick Economics Research Paper Series (TWERPS) No. 318.
1 The Golden Mean is the ‘Aristotelian’ desirable middle between two extremes, one of excess and the other of deficiency – see Aristotle’s Nicomachean Ethics II.1
2 A particularly interesting contribution in this area is a volume he edited (Williamson 1994). He wrote in this field in praise of what he called the ‘technopol’, the economist official or policymaker who helped governments to achieve their economic objectives. He was partly one himself.
3 At its 1972 Annual Meeting, the IMF’s Board of Governors set up a committee to help it to resolve the issues of international monetary reform. Formally known as “an ad hoc Committee of the Board of Governors on Reform of the International Monetary System and Related Issues”, the Committee’s name was abbreviated in normal usage to 'The Committee of Twenty’, or C-20, a title that describes the number of constituencies from which the members of the Committee were selected. John Williamson served as a member of several C-20 working parties.
4 Although I later became, inadvertently, a member of the Second Row Club, myself, I owe knowledge of it and the following wonderful description to my friend Ted Truman, another ‘member’ who wrote of himself and John: “We were also both members of a rather subversive organisation called the Second Row Club that would meet over dinner at the time of various international meetings and criticise the lords and masters who sat in the first rows of the meetings we all attended” (Truman 2021).