Padraic Pearse McGuinness, 1939 - 2008.

Bachelor of Economics (hons), Sydney University, 1960; Master of Science (Economics), London School of Economics and Political Science, 1967.

For many years a distinguished social, economic and political commentator. Paddy was a great friend of Henry Thornton, and provided great encouragement in many ways, both obvious and subtle. He was responsible for the choice of the nom de plume when "Henry" was unable to write freely under his own name.

 
Frank Devine, "Paddy was the quintessential independent thinker, scorning humbug and stupidity. He was a bloodthirsty predator among those he identified as members of the chattering classes".

Paddy McGuinness on magic puddings, ‘The idea that there is a magic pudding of labour market deregulation is similar to all the other kinds of folk fantasy I have referred to. The trap, according to the mythology, always emerges from the misuse of the magic solution, the widow's cruse or the three wishes. In Keynesian economics, the magic pudding is the notion that there is a kind of cost-free process of economic expansion. So government deficits became the magic pudding. In Reagan-style supply side economics there is a similar magic pudding notion, that tax cuts could magically generate more than the output and revenue increase needed to finance them. ... there is always a trap in the attempt to utilise these notions.’ Address to HR Nicholls Society, August 1988.

Paddy McGuinness on social engineering, SMH, June 2004, reprinted January 28, 2008. ‘The trouble with poor and disadvantaged people is that you can't trust them. Because of their disadvantage they have foolish and irresponsible attitudes to money, which they spend unwisely’.

Paddy McGuinness on central banking. ‘Paddy’s annual review of the RBA’s annual report filled the senior men with angry loathing and the young people with glee. These reviews were a material influence on (eventual) reform of the joint, when the young folk grew up’, PD Jonson (aka Henry Thornton).

Selected contributions from Paddy’s Quadrant editorials, 2006 – 2008.

‘...we are really guaranteed only about a year of the first Rudd government. After that the shape of the government is likely to change quite substantially.’  Quadrant, January-February 2008.

‘It is a horrendously difficult issue to deal with, and it is clear that we do not know how to deal with the problem of unfit parenthood. Nor do we know how to deal with the underclass as such, where child abuse is most common (not that it can ever be thought to be absent in other social strata). But certainly there seems a stronger case for being prepared to take children away from threatening environments and entrusting them to families better equipped to deal with them in a humane manner than for the current set of ill-considered prejudices on the part of those officially entrusted with the protection of children’. Quadrant, December 2007.

'It clearly emerged in the twentieth century and since that sentiment and morality are no substitute for analytical thinking about economic and social issues. This is where the churches have failed. They have stuck in the mire of late-nineteenth-century social thinking, and have devoted no serious intellectual attention to analysis of reality. That is, their social policy is best described as at best stupid and at worst wilfully immoral. They do not care enough about poverty and related problems to study them seriously’.  Quadrant, November 2007.

‘In London my first job after arriving broke in July 1963 was as a plongeur, washing up in a Bayswater pub. At this point in life it seemed to me that I would have far better trained as a plumber or electrician, useful and portable skills, than spent four years and more studying economics at a provincial university. But this was mistaken – it soon emerged that even that was a marketable asset, and could lead to far better things than life as a plumber or sparky. For example, it got me a part-time job as a librarian at the City Literary Institute which was a WEA-like body where adult students could attend lectures on literary and cultural subjects and also language courses. Issuing books and checking returns is pretty boring, but there was plenty of time to browse and the most memorable of discoveries was Flann O’Brien’s At Swim Two Birds, which had a quote on the cover from Brendan Behan, “Just the book to give your sister if she’s a large, boozy girl”. That’s for me, I thought, and plunged in, acquiring a long-lasting enthusiasm for O’Brien’s writing. Then I moved to a higher paid job with the Institution of Heating and Ventilating Engineers, off Sloane Square, near Chelsea. I also supplemented my income by reviewing books on related subjects for their journal and flogging off the review copies to a specialist bookshop, thus acquiring a theoretical knowledge of things like ducted air-conditioning and small bore water heating systems which stood me in good stead many years later by mystifying my future wife, an East German-qualified draftsman who worked on such recondite matters.

‘After a few months of this I saw an advertisement in The Economist for an economist to work in the Moscow Narodny Bank, which I soon discovered to be a Soviet-owned bank operating in the City. Why not have a go, said my curiosity. While I detested the Communist Party I was still very curious about the USSR (though well aware of its bloody history), and sympathetic to marxism in a general sense, though of course rejecting marxist economics in favour of Wicksellian economics and social-democracy and a sympathy for permanent protest style Sydney Libertarian anarchism. I wrote in and was interviewed by an ambitious young man who was in charge of the bank’s economic department, and after a while was offered the job. I was never asked about my politics and I have no idea what checks if any they carried out on me.

‘(In my ASIO file there is a fantastic account dated May 1973 of my having been recruited by a Soviet agent outside the British Museum reading room at a then huge salary. According to this agent I lasted only nine months and was sacked. This is pure nonsense, and I am afraid only demonstrates how sloppy ASIO was about its informants. The salient feature of my ASIO file is the incompetence and stupidity of its agents, who had little respect for accuracy. Indeed not long after  my return to Australia they spent a lot of time trying to find out where I was living, and then put me under photographic surveillance – all the time my name was appearing almost daily in the Financial Review. They never thought to ring up someone to ask.)’  Quadrant, late 2007.

‘DEAR GOD (or should I say, Dear Father, Son and Holy Ghostwriter, for I have heard from you only through your letter penned by your self-appointed amanuensis, Peter Coleman, in Quadrant, April 2007, in reply to my editorial of March),

‘It is difficult to address a letter to a wholly fictitious figure, although many millions, and now billions, of your reputed worshippers, subjects, playthings and victims seem to have no such difficulty. Perhaps this is because, as increasing evidence indicates, they are conditioned, or hard-wired, to believe in some kind of supernatural or extra-powerful personage—if you did exist, I would consider this dirty pool and contrary to any plausible doctrine of free will. Otherwise, it is merely evidence that evolution has endowed us with many strange quirks, as well as well-nigh uncontrollable lusts, passions and imaginations.

‘Either you or evolution has also endowed us with a profound capacity for evil as well as good, and we are all prone to both, and in some cases to extreme and, in both cases, sometimes horrible manifestations. As one of my Catholic priest friends speaking on his own and your behalf, put it, my use of the famous Kant remark about the “crooked timber of humanity” was just another way of speaking of Original Sin. Correct. But whence came this Sin?’ Quadrant, July 2007

‘It is clear that for the time being our dependence on coal and natural gas as a domestic source of energy must continue. Clean coal technology, as well as CO2  sequestration (though still likely to be difficult and expensive) offers the best prospect for stopgap measures, although it will inevitable increase the cost of coal-generated energy substantially. And we will continue to be a major coal exporter, thus indirectly adding to the global emissions level. Motor vehicle fuel will continue to be an important source of emissions, though in the short run hybrid vehicles offer a palliative. In the long run hydrogen would make the best clean fuel for motor vehicles, but this will require a clean source of energy for the production of hydrogen in sufficient quantities. Which of course inevitable brings us to nuclear energy. Initially, of course, Australia as the world’s largest reserve of uranium should continue to expand its exports. At the same time it would be sensible for us to invest substantially in research into nuclear energy and to train nuclear scientists and engineers in preparation for the date when clean coal use costs have risen sufficiently to make the production and use of nuclear energy economically feasible. The location of nuclear power plants is more a problem of artificially generated fears than of reality; research reactors have been safely located on American campuses for years. The real obstacle is the obsession of the spoiled middle classes with Nimbyism – not in my backyard-ism’. Quadrant, June 2007.

‘The great challenge to the Howard government, which it may not have fully understood, is that it has presented the community with changes to the industrial relations system which relate to their most basic fears and insecurity. It is not true that unions and the award system have been the mainstay of employment security as well as wages and related benefits, rather they have actively harmed employment and real income growth, but probably most people in employment in Australia believe hazily that there is a connection. And while the great success of the Howard government’s economic policies has been precisely falling unemployment and rising real wages, this has really given the beneficiaries more reason to fear the loss of what they have’.  Quadrant, May 2007.

‘The worst manifestation of ideology, religious or not, is intolerance. Gradually many of the mainstream Christian religions have been forced into tolerance – often by effective competition. Many have not, any more than some streams of the other great religions. But intolerance is not confined to religion – in our society intolerance of religion, especially traditional religion, is widespread. .... The most which can properly be demanded of any religion or ideology is that they be tolerant, if not respectful, of other religions and of non-believers. The same should be demanded of atheists. By all means ridicule or criticise religion. But it should not be forgotten ... that many highly intelligent people have believed in some kind of god and contributed to world civilisation in the process’. Quadrant, March 2007.

‘This month we celebrate the 50th year of publication of Quadrant, whose first editor was the distinguished poet and intellectual James McAuley. Its joint founder was Richard Krygier, whose experience of central Europe under communism had convinced him of the nature of that system, and with a small number of influential supporters he first founded the Association of Cultural Freedom, an offshoot of the Congress for Cultural Freedom which saw as its mission the conduct of intellectual resistance to communism. He had before him the example of the English journal Encounter, at its peak one of the most interesting of the intellectual journals of that country, and a number of continental counterparts. Since McAuley’s day there has been a number of editors of Quadrant, most notably Peter Coleman, and the fortunes of the magazine have fluctuated – never was it ever able to exist without continual financial exigency, and only thanks to a dedicated group of hardworking volunteers and a few generous donors. While all the other journals of this stable have gone, Quadrant remains the sole survivor. Against all the odds and despite many vicissitudes and the occasional crisis it continues to be a significant presence in the Australian cultural debate’. Quadrant, October 2006.

All of PP McGuinness’s Quadrant editorials from October 2000 are available here.

Banana Republic

Here is a link to an e-novel that features one TT McDuff, possibly a Scottish version of PPMcG himself.

Another useful source on the Global Financial Crisis of 2007-2013.

From the preface: ‘Stewart [McArthur is] the person who convinced me that my alternative persona, ‘Henry Thornton’, should have an independent voice.  This character was suggested by the late PP (Paddy) McGuinness as a nom de plume, the simple way of continuing to write serious economics when I took a job where such an activity was unlikely to be welcomed.  ‘Henry’ provided a lot to live up to, and in an interesting way led me to be bolder, as I struggled to throw off my training as a (very discreet) central banker.  ‘Henry’s’ comments are in italics at the head of each chapter and in other places.

From Chapter one:  ‘The Global Financial Crisis of 2007-08 might still produce a Great Depression. Massive monetary and fiscal stimulus has been thrown at the problem.  Major financial institutions, with one exception, have been bailed out by taxpayers. The problems created by excessive debt and over-easy monetary policy have been ‘solved’ by more of the same. The bailout of Wall Street by Main Street entrenches, indeed reinforces, what economists call ‘moral hazard’. The previous Chairman of the US Federal Reserve Board, Alan Greenspan, did not believe in opposing asset bubbles but cut interest rates under his control almost to zero when his asset bubble burst. This was a mistake repeated by his successor, Ben Bernanke, in the crash of 2007-08’.

And: ‘What a pity it will be if ‘lightly regulated’ capitalism, of the sort that harnesses  the power and magic of  Adam Smith’s invisible hand, is replaced by a new capitalism which features central planning, government by official and political diktat and officious regulation. This would strangle the golden goose that is capitalism, and make the capitalist world less prosperous and less free. The challenge, of course, is to devise better regulation, not more regulation and attempted micro-management from the centre’.