Centenarian TK Whitaker built State’s economic foundations

TK Whitaker's famous 1958 plan ECONOMIC DEVELOPMENT and the FIRST PROGRAMME FOR ECONOMIC DEVELOPMENT derived from it

are on the Leaving Certificate History course for 2016/17 

For background to both and incorporating new information see chapters 5 and 7 of TK WHITAKER: PORTRAIT OF A PATRIOT

Radical civil servant played pivotal role in economic, social and political life of State

Published by the Irish Times by Author Anne Chambers Thu, Dec 8, 2016, 05:00 Updated: Thu, Dec 8, 2016, 08:29 

Every country has its heroes. Some are generals, some are conquerors, some even tinsel celebrities. Few countries would nominate a long-retired civil servant.

However, in 2002, Irish people, when polled to name the Irishman of the century”, chose TK Whitaker, the man regarded as the the architect of modern Ireland. Today Ken Whitaker celebrates his 100th birthday.

Born months after the Easter Rising, his long life parallels the history of the modern Irish state, in whose economic, financial, social, educational, political and cultural evolution he played a pivotal role.

He was just six when his family moved south from Rostrevor in Co Down to Drogheda, where his potential was nurtured in the local Christian Brothers school.

In 1934, he joined the Civil Service as a clerical officer and by 1956, aged just 39, he had become secretary of the Department of Finance.

By then, the fledging Irish State was in crisis, marred by economic stagnation and rampant emigration. Agriculture was in a “prehistoric state”, the country’s mood was despondent.

“Economic and social development had failed to live up to expectations engendered by the struggle for, and achievement of, political independence,” he remembered.

Protectionism, a policy introduced by Seán Lemass, had outlived its usefulness, but “it was difficult to dismantle”, he recalled. “It had become a sort of patriotic ideal and any change could be viewed as undermining nationalism.”

 

Economic plan

Since the politicians were unwilling or unable to find solutions, Whitaker’s thoughts began to ferment around an economic plan that would change everything.

Shortly after his appointment, he went to Washington to assess the possibility of Ireland joining the International Monetary Fund and the World Bank, to avail of their technical support and capital investment.

On March 21st, 1957, the Minister for Finance, Dr James Ryan (a veteran of 1916) was confronted with a document written by Whitaker, entitled “The Irish Economy”.

In language that breached the boundary between public servant and politician, Whitaker urged the government to stop sheltering behind “a protectionist blockade” that had condemned the Irish people to a lower standard of living than the rest of Europe, encouraged emigration, but also threatened the State’s very existence.

Resorting to rhetoric that he knew would more than ruffle feathers in a government led by Éamon de Valera and Lemass, he said an immediate change in policy was needed, or else, he told them, “it would be better to make an immediate move towards reincorporation into the United Kingdom”.

Behind the scenes, with the help of willing young colleagues, Whitaker had already embarked on a blueprint for the economic regeneration of the country.

Simply entitled “Economic Development”, it was written in a style and language aimed at the ordinary citizen as much as at politicians . He offered a radical remedy: the introduction of free trade and an end to protectionism

It was tough medicine, but essential if the patient – Ireland inc – was to have any hope of survival, he believed. Not just physically but psychologically, “Economic Development” lowered the barriers Ireland had erected around itself.

 

Positive response

The response from the government, especially from Seán Lemass, the architect of protectionism decades before, was both positive and immediate.

Whitaker’s surprise at how quickly his plan was adopted is still palpable, leaving him to note humorously that if it had failed, then the government could have blamed “a group of chancers in Finance who had never been asked to do it in the first place!”

Whitaker and his team worked on the plan on a totally voluntary basis outside office hours, without any notion or expectation of monetary gain or promotion, simply because something had to be done.

Whitaker left his imprint on the public service in other ways. In 1957 he helped establish the Institute of Public Administration, which improved public service training and introduced a university scholarship system for officials.

Given that economic research was paltry at best, he personally elicited a grant from the Ford Foundation in America to establish the Economic and Social Research Institute in 1960.

During the 1960s he spearheaded Ireland’s convoluted path towards membership of the European Economic Community, culminating in a private meeting with the implacable Charles de Gaulle.

In time, he felt that the idealism, realism, the community ethos, the élan vital that had motivated the community’s founding fathers had been somewhat sidelined , something that has a resonance today .

Whitaker was also less than enthusiastic about Ireland’s abandonment of the link with sterling in 1979, a move he described as “a quixotic gesture”.

 

Warning light

In 1969 Whitaker became governor of the Central Bank, and he gave notice that the bank would be “the warning light”and that it might also have “unpalatable things” to say.

Quickly transforming the institution, he set out from the start to ensure its independence from the government and the commercial banks.

In 1970 he resisted efforts by the government to obtain statutory control over the exercise of credit policy, a move, which, he said, he could “not regard as being in the national interest” and that if the minister persisted he would resign as governor. Credit policy remained under Central Bank control.

During the 1970s, faced with runaway inflation, balance of payments deficits, galloping spending and high pay awards, he enforced strict credit constraints, restricted credit to the commercial banks, imposed penalties for excessive lending to an overheated housing market, as well as stemming the tide of external capital inflows.

In the area of regulation and supervision, under Whitaker’s governorship, the Central Bank’s control over the Irish banks evolved and strengthened.

The Central Bank’s failure to act as a “warning light” during Ireland’s last unsustainable boom left him “perplexed and appalled”, and his words to the incoming governor Patrick Honohan in 2009 –“I’m counting on you to save the country from national humiliation” – expressed the depth of his disappointment at the bank’s perceived failure to discharge its obligations .

In 1976, he resigned from public office, or thought he did. Instead, he went on to serve in the Seanad, nominated by two major political parties while still speaking as an Independent; served on the Council of State; and held the chancellorship of the National University of Ireland for 20 years at a most critical time in its development.

In addition, there was a near-endless succession of committees, commissions and reports, over 40 in all, and mostly done on a voluntary basis.

Northern Ireland

His role in establishing relationships with Northern Ireland started in the 1950s, when he initiated cross-Border connections with his civil service counterparts across the Border.

The subjects were prosaic, perhaps, but practical: electricity supplies, transport and the Erne waterway. In 1965 he arranged the historic meeting between Seán Lemass and Captain Terence O’Neill in Stormont.

Despite the terrible chaos of the following decades, he never gave up on the search for peace by constitutional means. In 1969, amidst the carnage, rioting and teargas, he wrote Jack Lynch’s famous Tralee speech, which for the first time committed the Irish government to a policy of reunification on the principle of consent.

In 1970 he embarked on a behind-the-scenes dialogue with his opposite numbers in the public service and banking sectors in Northern Ireland and in the UK, from which, over the next two decades, emanated many policy documents, which, in turn, informed the Irish and UK governments’ policies on Northern Ireland.

One of Whitaker’s own policy documents “Northern Ireland – a Possible Solution”, written in 1971 is, in reality, the Belfast Agreement for slow learners, albeit with almost 30 intervening years of violence, destruction and the loss of over 3,700 lives.

Today, however, there is one piece of the jigsaw that he feels is still missing – the establishment of a council of Ireland, as part of the political relationship between North and South, where issues such as, for example, Brexit, could be debated.

 

Irish language

Throughout his life, he has maintained a love of and commitment to the Irish language. Again, his approach was pragmatic, not ideological, in his promotion of bilingualism, rather than an impractical replacement of English.

In a world exposed to powerful and ever-changing technological advances and to the standardisation and globalisation of every aspect of life, including culture and language, he has noted that government policy is no longer enough to ensure the survival of the Irish language. It also requires an acknowledgement by all of us that the language is worth saving and that we have the will as a community to ensure that it is saved.

Whitaker’s long-held concerns about income inequality and the detachment of the financial markets from a sense of societal responsibility or accountability are more relevant than ever today.

In the 1980s, he asked: “Is it little more than a fiction that parliament and government are sovereign? Does the State’s power rest precariously on day-by-day tolerance of its authority by powerful sectional interests? Are governments nowadays to be compared to the totally deaf Beethoven in his later years, just being allowed to go through the motions of conducting the orchestra while the real control is being exercised elsewhere?”

However, if Whitaker asks some of the questions that are central to today’s public debate, he has provided some of the answers, too, that should guide his successors.

“There are values, moral and intellectual, which are higher than just mere economics. But it makes for a happier and more contented society if everybody has some basic share in wealth and wellbeing.”

Now in his 100th year, his achievements rest lightly on his shoulders and his ability not to take himself too seriously has over the years let him see the humour even in the most historic occasions.

Recalling the 1965 Lemass-O’Neill lunch, he once wondered whether Dr Ian Paisley’s worst fears “would have been confirmed at the time if he knew that the wine served was Chateauneuf-du-Pape”.

He remains sanguine about reputation, noting that “if you live long enough you would be either canonised or found out, the worst fate is to being found out after you are canonised!”

When asked how he would most like to be remembered, his reply – “As a public servant, who did his best” – is an honourable legacy for the greatest living Irishman.

Anne Chambers is the author of TK Whitaker: Portrait of a Patriot

Click here to read this article on the Irish Times web site. 

 

 

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GRANUAILE: Ireland's Pirate Queen (Grace O’Malley) 1530-1603 is the sole published biographical account of Grace O’Malley, sourced from original manuscript material, both in public and in private domain. For the latter, the author, Anne Chambers, had sole and exclusive access. Much of this material was located and decyphered in its original form (i.e.16th century manuscripts) by the author and is exclusive to her book. Furthermore, the presentation, opinions and analyses in the book are exclusive to the author. The author reserves all her rights in this book. No part of her book may be reproduced or utilised in any form or media, written or oral, or by means digital, electronic or mechanical, including photographic, film, video recording, photocopying, or by any information storage and retrieval system. Permission from the author and publisher must first be obtained to reproduce any part of or quotations from the book. Any transgression in this regard will be addressed. For more information, comments or enquiries please contact: Info: This email address is being protected from spambots. You need JavaScript enabled to view it. Copyright © 2017.

 

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