Sir Roland Wilson
by Selwyn Cornish
Roland Wilson, economist and public servant, was born at Ulverston, Tasmania on 7 April 1904. He died in Canberra on 25 October 1996, aged 92 (see Obituary) . His father was a building contractor and cabinet-maker. Wilson was the first of his family to complete secondary school and attend university. His formal education began at the convent school in Ulverston, where he won a government bursary that allowed him to continue his studies at the state high school in Devonport. There he secured the highest passes for his year in the Tasmanian junior examination and was awarded a senior bursary. In the senor (matriculation) examination he was placed second in the state. He was then persuaded by DB Copland to enrol in the commerce degree at the University of Tasmania where he attended lectures given by Copland, LF Giblin and JB Brigden.
Wilson secured first class honours and was awarded the Tasmanian Rhodes Scholarship for 1925, the first recipient from that state to come from a government high school and the first from the Faculty of Commerce. He was admitted to Oriel College, Oxford, with the intention of taking the B.Litt degree. But he found that Oxford did not recognise the Tasmanian commerce degree and so he was compelled to take the Diploma in Economics and Political Science, which he completed with distinction. In his first year at Oxford, he successfully submitted an essay on ‘Social and Economic Experiments in Queensland from 1860’ for the Beit Prize in Colonial History, one of Oxford’s most prestigious prizes. In consequence, he was granted “Advanced Student Status’ which permitted him to undertake studies for a doctorate (D.Phil). His thesis entitled The Import of Capital, supervised by Eric Hargreaves, was accepted in 1929. DH McGregor, one of his examiners, wrote that ‘the examiners were agreed that he had handled an intricate subject with great ability, and that his work was worthy of publication’.
While at Oxford, Wilson travelled to the United States for the first time as a member of a group organised by the English Speaking Union, beginning a fascination with that country that was to endure for the rest of his life. Before he completed the D.Phil he applied for a Commonwealth Fund Scholarship (later the Harkness Scholarship) to undertake postgraduate studies at the University of Chicago. There he enrolled for a Ph.D. Jacob Viner supervised his thesis on Capital Movements and their Economic Consequences, which extended some of the themes adumbrated in his Oxford thesis. About Wilson, Viner wrote that he was ‘one of the two or three best students I have ever encountered’; he was ‘an exceptionally able student and research, quick, original, industrious and systematic. He writes freely and well, and expresses himself easily and effectively. He has an unusual degree of intellectual maturity for a person of his age’. Viner predicted, incorrectly as it turned out, that Wilson would ‘have a highly successful career as a teacher and scholar’.
The substance of both doctorates was later published in a book, Capital Imports and the Terms of Trade. A highlight was the painstaking empirical work, from which Wilson was able to assemble estimates of capital inflow into Australia from the late nineteenth century. There were also some arresting theoretical conclusions. He refuted the conventional view, enunciated by John Stuart Mill, that a country with a net inflow of capital would experience favourable terms of trade. Of greater significance was his conclusion that overseas borrowing would raise the price of non-tradeables relative to the prices of tradeables. This idea of Wilson’s long predated similar ideas embodied in concepts such as the ‘Dutch disease’ and the ‘Gregory Thesis’.
When he completed his thesis at Chicago, Wilson was offered a position at the University of Toronto,. However he had married and American and was anxious to take her back to Hobart. He accepted a lectureship at the University of Tasmania, but he was not entirely comfortable living the life of an academic, confessing that he ‘never felt deeply attracted to a scholarship for its own sake’. Instead he thought he would like to work as a policy adviser to governments. An opportunity arose in March 1932, when Giblin, Acting Commonwealth Statistician, invited him to fill the position of Economist in the Statistician’s Branch of the Treasury. He accepted the offer, and soon become Assistant Commonwealth Statistician. He was the first economist to be employed at a senior level in the Commonwealth Public Service. After declining in 1935 the chair of Economics at the University of Tasmania and Financial Adviser to the Tasmanian Government, he was appointed Economic Adviser to the Commonwealth Treasury. In 1936, at the age of 32 he succeeded ET McPhee as Commonwealth Statistician, a post he retained until he was appointed Secretary to the Commonwealth Treasury in 1951.
Shortly before the outbreak of war, Wilson was appointed, together with Giblin and LG Melville, to the Financial and Economic Committee, an advisory committee attached to the Treasury. Wilson himself had proposed the establishment of such a committee, which took responsibility for much of the planning of the financial and economic direction of the war, and for the preparations of blueprints for postwar reconstruction. As part of Australia’s defence planning, Wilson was placed in charge of the National Register of the male population and undertook a census of wealth. In 1940 he was invited to head the new Department of Labour and National Service, where he established a division of postwar reconstruction. It was there that much of the early work on postwar reconstruction was undertaken. It was to provide the nucleus of the Department of Postwar Reconstruction when it was established in 1943.
Because Wilson had initiated work on postwar reconstruction, he was invited by Prime Minister Curtin to represent Australia at the first British Commonwealth conference on the international economy in the postwar era, held in London in October 1942. Upon the agenda was Keynes’s International Clearing Union. Keynes was greatly impressed with Wilson’s work at the conference, writing to Giblin that Wilson ‘took a prominent, indeed a leading part through all the discussions and played a major role in them with the greatest success. We had a great gathering of Whitehall officials, who came to feel the greatest respect both for his wisdom and for his perspicacity’. Keynes invited him to Cambridge to attend a ceremony at the Marshall Library to mark the centenary of Alfred Marshall’s birth. In 1945, Wilson attended the conference at San Francisco that established the United Nations. There he was responsible for having the full employment pledge included in the United Nations Charter. The following year he was appointed to the Economic and Employment Commission of the United Nations, serving as its chairman in 1948-49; at the same time he acted briefly as Economic Counsellor to the Australian Embassy in Washington, and Alternate Director for Australia and other countries at the IMF and World Bank.
In 1949 Wilson was offered the chair of economics in the Research School of Social Sciences at the ANU, the first chair in economics to be established by that University. But he declined the appointment, doubting that he had the capacity for sustained research of a kind that would be expected of a professor in an institution dedicated to research. He had his eyes fixed on the position of Secretary to the Treasury, to which he was appointed on 1 April 1951 at the age of 47. He held the position until he resigned in 1966, serving in the post longer than any other Treasury head. The Launceston Examiner perceptively noted, at the time of his appointment, that ‘For fifty years Treasury administration has been in the hands of persons who were predominantly accountants and graduates from the Treasury’s accounting department’; Wilson’s ‘appointment marks the first Australian experiment of this kind, and it is a good bet that as far ahead as one can sell all of his successor will be economists, too’.
The period of Wilson’s tenure as head of the Treasury is often regarded as the high watermark of Keynesianism in Australia, and it is commonly believed that Keynesianism was the guiding principle of the department’s approach to policy. Yet Wilson was never convinced that policy settings should be constantly manipulated for the purpose of fine-tuning the economy. This often put him at odds with his counterpart at the central bank, HC Coombs. Wilson was primarily interested in accelerating Australia’s economic development, and was therefore inclined to allow the economy to expand beyond its short term limits. When the brakes had to be applied to avoid excessive drains on the foreign reserves, the result invariably was recession and rising unemployment.
Some of Wilson’s greatest work in the Treasury was aimed at fostering a more efficient and dynamic economy. In particular, he was opposed to Australia’s high rates of trade protection and often clashed with the Department of Trade on this issue. While endorsing the reimposition of import controls in the emergency circumstances that prevailed in 1952, when following the bursting of the Korean War boom, Australia was flooded with imports, he opposed the quantitative import controls in principle as a permanent feature of the Australian economy, preferring instead a more flexible exchange rate regime. Accordingly, he was a strong advocate of the return to convertibility of sterling area currencies, arguing that Australia’s adherence to a sterling area controls imposed a straitjacket on the nation’s efforts to force the pace of economic growth and development. On wages policy, he believed the centralised system of arbitration, together with quarterly adjustments to the basic wage according to movements in retail prices, contributed both to inflation and to inefficiencies in resource allocation.
Wilson left the Treasury in 1966, three years ahead of the compulsory retirement age of 65. This decision reflected in part his desire to allow his deputy and near contemporary, RJ Randall, the opportunity to head the Treasury. In part it was determined by the appointment of William McMahon as Treasurer, a person whom Wilson could not abide. There was also another reason: the chairmanship of the Boards of Qantas and the Commonwealth Bank were about to fall due and Wilson was ready to take on a new challenge. In due course he was appointed to the chairmanship of the Wentworth Hotel, a fully owned subsidiary of Qantas, and to the boards of Mercantile Life and Citizens (MLC), Imperial Chemical Industries (Australia), and the Australian – European Finance Corporation. As with everything else he did, he approached his work as a company director conscientiously and was highly regarded both by his fellow directors and by the staff of the business enterprises with which he was associated.
Often regarded as the outstanding public servant of his generation, Wilson was awarded the CBE in 1941, created Knight Bachelor in 1955 and was awarded a second knighthood (KBE) in 1965. The University of Tasmania conferred upon him the LLD in 1969. He was made a Distinguished Fellow of the Economic Society of Australia in 1988.
Coleman, William, Selwyn Cornish and Alf Hagger (2006), Giblin’s platoon. The trials and triumph of the economist in Australian public life, Canberra: ANU EPress.
Selwyn Cornish (2002), Roland Wilson. A biographical essay, Canberra: Sir Roland Wilson Foundation.
Roland Wilson (1931), Capital imports and the terms of trade, Melbourne: Melbourne University Press.
Roland Wilson, (1969), Address at the commencement ceremony, Hobart: University of Tasmania.
National Library of Australia (1984), Oral history interview with Sir Roland Wilson conducted by Cameron Hazlehurst and Colin Forster.
Roland Wilson (1986), Address to mark the 50th anniversary of appointment as Commonwealth Statistician, Canberra.