Congdon attacks fellow 'wise men'

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The Independent Online
THE FUTURE of the Chancellor's new panel of economic advisers - the so-called seven wise men - is in question after its most outspoken member launched a scathing attack on the professional competence of his colleagues.

Tim Congdon, the monetarist economist, says in an open letter to be published next week that the other six panel members signally fail to understand the workings of the economy, and that this has led them to advise against a tax increase.

In a vituperative passage that strains at the normal boundaries of academic controversy, Mr Congdon, a former journalist who is now a City economist and an honorary professor, says that his fellows are 'like literary critics who read prose but never read poetry, or mathematicians who understand arithmetic but are bewildered by algebra'.

Mr Congdon's outburst is likely to confirm the public's longstanding view that all the economists on earth laid end-to-end would still not reach a conclusion, but it will not surprise those who know the economist.

Always a controversialist who would cross a seminar room to join a good argument, Mr Congdon is said to believe that his fellow panellists should go back to examining basic economic textbooks.

Mr Congdon last night confirmed that he will send out the letter next week. He is understood to want to remain on the panel rather than resign, but wants to bend its remit to look more fully at the role of the money supply in driving economic growth and inflation.

Mr Congdon's letter, to be published by Gerrard & National, says that the other six have been 'grossly incompetent' because they do not take notice of the effect of money balances.

He argues for a large tax increase in the 16 March Budget to staunch the Government's budget deficit next year. He thinks this would not affect the recovery.