Ship life shaped economist’s views
Len Bayliss, economist: b August 13, 1927, London; m Vivienne Bayliss; 3s; d Waikanae, January 19, 2018, aged 90.
Long before his famous clashes with prime minister Robert Muldoon, a young Len Bayliss was already defiantly staring down authority.
The London teenager born with ‘‘two silver spoons’’ in his mouth had access to pretty much everything: boarding schools, the best education, family wealth. But it wasn’t enough.
Barely into his teens, he declared to his father that he would be emigrating. A few years later he would make good on that declaration. To the benefit of this country and its economic direction.
But first he needed to find his own direction; he looked to the sea and joined the navy towards the end of World War II.
The next three years would help Len build on earlier lessons from a life lived through the Great Depression. ‘‘The unemployment and the hunger burned into my consciousness pretty hard,’’ he recalled in an interview in 1984.
That awareness of both his own privilege and the struggle of others was further awakened in the dark depths of various navy vessels he served on. He worked with men who never saw the inside of a boarding school, would never have the opportunities he had.
‘‘It was a real turning point that he talked about,’’ says son Jeremy. ‘‘His time under the decks really gave him a good understanding of how the poor were less advantaged. He really felt he’d been blessed and lucky and that he should do something with it.’’
He was certainly ‘‘blessed and lucky’’ to make it through the war unscathed.
‘‘The Germans gave up just as he joined and then he got sent to Singapore and the Japanese gave up as he turned up,’’ says Jeremy, ‘‘so he was always very proud that he was the key influence for the Germans and the Japanese.’’
Len had always been keen on history and politics and saw economics as a natural extension of that interest. He left the navy in
1948 to study at Cambridge University. He studied the politics and history of economics, principles and policy, and finished with a Master of Arts with honours.
A ‘‘marvellous’’ education sorted, now Len could make good on that bold declaration a decade earlier.
He considered America, Canada and South Africa, among others. The choices were narrowed down to Australia and New Zealand, and Len was convinced on the merits of the latter during a ‘‘cup of tea’’ in London with Alex Ross, the Reserve Bank deputy governor at the time. That and his fear of Australia’s spiders and snakes.
He arrived in 1951 to a role as an economist with the Reserve Bank. Wool was booming, the economy was highly regulated,
1950s New Zealand was a little disappointing – ‘‘it looks like a real slum’’, Len remembered thinking – but he was part of a bright, young team, ‘‘a hotbed of discussion’’.
‘‘We didn’t do very much then,’’ Bayliss said in 1984. ‘‘We spent an awful lot of time talking and rushing off to the pub at 5 o’clock.’’
He might have been new to the country, but as Jeremy recalls, Len was an avid, ferocious reader always searching for the wider truth and a greater understanding of how economics affected people.
As his career progressed Bayliss moved from participating in that ‘‘hotbed of discussion’’ to leading the debate.
Over the next couple of decades, as his profile grew, Bayliss’s devotion to debate, his belief that ‘‘controversy is the stuff of democracies’’, would be rewarding and damaging in equal measure.
In 1961 he was seconded to Treasury – ‘‘right in the middle of things’’ – and then joined the Monetary and Economic Council, where he wrote a number of influential reports on the financial system, some of which made frontpage news.
In 1966 Bayliss was appointed chief economist at the Bank of New Zealand, and he used the position and associated public speaking role as a platform to push for more liberalisation and reform of the economy to combat growing inflation, interest rates and unemployment.
He became the counterpoint to the government, a go-to man for the media, the most prominent economist of his generation, who helped pave the way for the more public face of economic debate, and modern counterparts like Cameron Bagrie and Shamubeel Eaqub.
In 1975, Bayliss was called up to be part of the prime minister’s advisory group. It was believed Muldoon had asked for the opinionated economist personally.
It began well, says Jeremy. ‘‘He spoke about Muldoon as being an incredible person: the intellect, really had a fantastic working relationship with him.’’
Bayliss himself said ‘‘he was the best boss I’ve ever had. Absolutely decisive.’’
He worked with the head of the Prime Minister’s Department, Bernie Galvin, to encourage various reforms, laying a foundation for change that would include, among other things, deregulation of monetary policy and, increasingly, a more marketoriented approach.
That attracted world attention. ‘‘We went from the most regulated to one of the more liberal financial markets in short order,’’ Bayliss said. Even the Australians were envious.
But after Len returned to the BNZ he watched over ensuing years as Muldoon tightened his grip and the economy. And he fumed. He became an outspoken critic of the government’s economic policies, and Muldoon became an outspoken critic of his former adviser, derisively mocking him as ‘‘the darling of the Rotary circuit’’.
That brought pressure on the bank to rein in its chief executive. It was as unrelenting as Bayliss’s critique in the media.
When he finally resigned in 1982 to take up a consulting role with Wellington sharebroker Harcourt Longuet Hume and Co, the media was abuzz with suspicions of conspiracy and political thuggery. Bayliss, for once, kept his own counsel.
Jeremy believes his father was ‘‘intellectually delighted to be free of the shackles of the bank’’.
In the following years Len’s influence was increasingly away from the public eye. He kept in touch with a number of finance ministers and prime ministers and supported the broad liberalisation of Rogernomics, but was concerned at its implementation and impact on the vulnerable.
There were other consultancy roles and directorships, including at Mainstay, NZ Govt Life/Tower, and the Bank of New Zealand. Len was a keen walker, right up to his last weeks, and an avid traveller with his wife of 64 years, Vivienne.