The Visiting Committee’s Report, February—April 1948

Having been told by Compton about Klein's The Keynesian Revolution, Beadle had a new reason to be concerned about Samuelson. In January 1948, he wrote to Freeman asking whether its final chapter, “Keynes and Social Reform,” had also been in Klein's thesis.

j. While these discussions were going on within MIT, Tarshis was receiving strong support within the AEA. In October, Harvard's Seymour Harris wrote to Paul Douglas, president of the AEA, drawing his attention to the threat posed to academic freedom by an organization run by someone widely reported to be “a well known Fascist” and noting that Carl Shoup, of Columbia, had drafted a reply to Tarshis's critics (S. E. Harris, October 27, 1947, Letter to Paul H. Douglas, PASP 37 [Harris]). Because he believed that it was important that instructors not be subject to outside pressure in their choice of textbooks, Harris recommended that the AEA set up a committee to strengthen the hand of those disposed to fight for academic freedom. Forecasting that the problem would become increasingly important, he suggested that the AEA also investigate “what the National Economic Council is and where it receives its funds.” The outcome was that on December 30, 1947, the AEA approved a statement saying that “university and college teachers must have the free and untrammeled right to select for use in their teaching and research such textbooks and related materials as they, and no others, believe will promote the purposes which their courses are intended by their teachers to serve” (American Economic Association 1948, p.

k. Klein's thesis did not contain this chapter, closing with one that countered the charge that Keynesian theory was simply “depression economics.” of the book.⁵⁶ His reaction was that “if this represents the type of economics Samuelson is teaching.. I, too, am somewhat concerned.... [I]t is pretty difficult for me to subscribe to some of the statements made, and I would seriously question the advisability of teaching this kind of economics at M.I.T. I hope, sincerely, that the book does not correctly reflect the doctrine which is being taught.”⁵⁷

Though conceding that it was unfair to take sentences out of context, he quoted a few from Klein's final chapter in case Killian wished to take the matter further. These quotations included statements about the need to redistribute income from rich to poor so as to reduce saving and the need to have a program of social reform even after the program of unemployment was solved. One sentence praised the work of the highly controversial Office of Price Administration, as having “served us beyond all best hopes and wishes during the War and it did not infringe upon any fundamental liberties, only upon the liberty of greedy profiteering.”⁵⁸ In a postscript, Carpenter men­tioned he had discussed it with a friend, whose reaction was: “this is not the type of economics that I would like to have my son taught.”⁵⁹ Carpenter made one concession:

He [Carpenter's friend] went on further to state (in which I agree) that if the professor pointed out that this is one type of economic thinking, and here (giving the conservative type) is another type of thinking, stating both impartially, tho I would prefer it that he stated a prefer­ence for the conservative type, then that type of teaching could not be seriously criticized.

Two days later, Beadle wrote to Killian, enclosing a copy of Klein's book and saying that if he and Compton had not read it, they might wish to do so.⁶⁰

Before replying, Killian checked with Dean Caldwell, who commented that the last paragraphs of Carpenter's letter did contain a constructive sug­gestion, and that his own discussions with the department confirmed the view that a wide range of viewpoints was presented. Samuelson and Professor Tucker, also involved in teaching, held very different views, and he had been surprised by the number and variety of materials to which students were “constantly” referred.⁶¹ As for bringing in Klein, Caldwell discounted this on the ground that students' views did not always reflect those of their teachers, and that Samuelson would have expressed his views more cautiously and in a less extreme form than someone younger and less experienced. Caldwell's response was relayed to Carpenter in great detail. The point about his being more cautious than his student was the basis for saying that Samuelson should be judged on his own statements, and that they should wait for the textbook to be published before commenting on it. Killian also stressed, as he had done earlier to Beadle, that Samuelson was a pioneer in economic thought and a creative scholar, who was committed to seek the truth, and whose work was “governed by the highest ideals of scholarly work.”⁶² Samuelson might have different ideas about what makes the free enterprise system successful, but he believed in it.^[LXVII]

Killian tried to persuade Carpenter to look beyond a single course:

Perhaps of more importance is what might be called the general intel­lectual climate in which the students at the Institute operate. The whole atmosphere is one of objectivity, and even if a single course were to become—despite our policy—biased in its material, I think the chance of it having an undesirable effect upon our students is extremely small.

However, Beadle did not relent in his attempt to persuade the MIT authori­ties that Samuelson’s views were dangerous. In April, he wrote to Killian, drawing attention to a very critical review of Klein’s book in the latest issue of the American Economic Review. Its author, David McCord Wright, a Harvard friend of Samuelson’s, had criticized the book on technical grounds as well as pointing out, in a passage to which Beadle drew Killian’s attention, Klein’s apparent sympathies with Marxism.

Nor does Klein ever seem to consider that at least a partial incen­tive for activity is not merely to enjoy income but also to accumulate and transmit wealth. The explanation for his oversight and others is, I believe, ideological. From the text, Dr. Klein seems to have strong sympathies with socialism if not Marxism.⁶⁴

This was, of course, true. As evidence that Samuelson did not object to the way Klein attributed certain ideas to him, Beadle quoted his contribution to a recent volume edited by Seymour Harris, in which he stated that his chapter owed much to discussions with Klein, whose “rewarding study” was shortly to be published.⁶⁵ To link Samuelson to Klein’s views was to show that he was guilty of the charges being made against him. Beadle also drew attention to McCord Wright’s closing remark.

If economists are ever to be anything more than bickering apologists for the factions of the hour, they must learn to remember alternative assumptions, policies, and philosophies; and to be less jaunty before the vastness and variety of that life process which our finite minds are striving so desperately to describe.⁶⁶

Beadle clearly thought Samuelson a “bickering apologist for the hour” who needed to be pushed into considering alternative views.

Under these circumstances, Samuelson must have been reassured by the series of letters he received from instructors who had either seen his 1946 draft or had heard about it, and asked whether the published version would be available in time for use in their courses.

Given that the department felt under attack from Beadle, and that Beadle felt frustrated in his “altruistic desire to make a contribution to the depart­ment’s progress,” it was crucial to air the matter at an open meeting of the Visiting Committee. In preparation for this meeting, Beadle consulted Beardsley Ruml, with his experience at the Rockefeller Foundation. Ruml explained that he personally favored an economics course on the relationship between the state and individual enterprises, whether in controlled, planned, or free enterprise systems. However, his main interest was in the structure of the entire program, which he thought should be focused on political and economic power rather than economics.⁶⁸ Beadle read the book Ruml recom­mended, arguing that Ruml’s chapter “Profits and Compensation” should be made compulsory reading in the course, as the most powerful statement he had read on the “incentive aspects of our economy.”⁶⁹ He also recommended a criticism of planning.⁷⁰

This meeting of the Visiting Committee eventually took place on May 3, 1948, its agenda taking the form of a series of questions to Freeman. The committee was satisfied with the statement of policy contained in the booklet “Humanities and Social Sciences,” but it sought an assurance that the policy was being carried out and that bias would not be introduced because stu­dents happened to get an instructor with a particular point of view or failed to read optional materials. Ruml’s chapter on the importance of incentives had been included on the reading list, and it was suggested that an article in which Keynes stated that “the classical teaching embodied some perma­nent truths of great significance” should also be added.⁷¹ The committee also asked whether students’ attention might be drawn to five propositions critical of planning: that government planners were as fallible as those in private industry; that political pressure on government administrators might lead to “grave economic error”; that government errors were likely to have more serious consequences than private ones; that the absence of profit or loss accountability might make government errors more prolonged; and that government activity and controls might deter private initiative and invest- ment.⁷2 This list showed that though they claimed to have accepted that a variety of positions be represented, the committee clearly sought to make sure that students were exposed to its own critical view of government activity.

The final report expressed appreciation for the department's cooperation and support for its policies, but noted that its teaching, like that at other universities, had been “greatly influenced by the writings of the late Lord Keynes.”⁷³ Noting that such views were associated with central government planning, they suggested that when a student was studying a theory concern­ing possible benefits of planning, attention should also be drawn to a number of reasons why planning might be harmful. Admitting that the committee was concerned particularly with the presentation of “conservative or classical standpoints,” they accepted a policy statement by Freeman to the effect that readings would present points of view different from those in the textbook. They also recommended that faculty appointments reflect the desirability of representing different points of view. Though couched in diplomatic lan­guage, stressing diversity of views and the need for objectivity, and avoiding anything that might be embarrassing to MIT, this was an attempt to move the department's teaching in a more conservative direction. What might have been a crisis over Samuelson's influence on the students had been averted, if only temporarily.^m

m. Controversy was to erupt again, after the book was published, and continued throughout the 1950s.