Thomas (Tamás) Balogh was a British economist who was born in Hungary on 2 November 1905 and died in London on 20 January 1985. He was created Baron Balogh of Hampstead in Greater London on 20 June 1968 and as a Life Peer was a member of the House of Lords (as Lord Balogh).

After graduating from the universities of Budapest and Berlin, Balogh accepted a 2-year research position at Harvard University in 1928, after which he worked in banking in Paris, Berlin and Washington before arriving in England in around 1931. His intellect and energy saw him quickly establish himself among his peers. He was a contemporary of the British economists John Maynard Keynes and fellow Hungarian Nicholas Kaldor.

After gaining British citizenship in 1938, Balogh became a lecturer at Balliol College, University of Oxford. He was elected to a Fellowship in 1945 and became a Reader in 1960. Other roles he held included economics correspondent for the New Statesman, economic adviser to Labour Prime Minister Harold Wilson, and member of the Secretariat of the League of Nations.

Balogh’s debates regarding economic policy and inflation, especially in the aftermath of the Second World War, centred on how to maximise the war effort without exacerbating inflation. As an adviser in the Cabinet Office, Balogh was a critic of consumption and profit-orientated tax policies. He was opposed to Britain’s entry to the European Economic Committee. Although his views were not shared by all, he was widely acknowledged as a brilliant economist.

The outbreak of war in 1939 and subsequent economic and financial hardships affected the Australian economy, which was still largely influenced by and dependent upon the UK and European financial markets. The Commonwealth Bank of Australia’s Board felt that regular reports on overseas economic trends and issues would help inform the Bank’s policy decisions during the war and subsequent recovery. In 1941 the Bank employed Balogh, through its London Office, to send regular reports on UK and European financial conditions. Initially contracted for a 6-month period, Balogh became a frequent correspondent with the Commonwealth and Reserve Banks, sending regular reports to the Bank¹ for over 20 years, with this correspondence only ending when he became adviser to Harold Wilson in 1964.

Letters from London

Balogh’s reports, in the form of long and detailed letters, cover observations of the economic climate, personalities, institutions, governments and key episodes in history. Starting in 1941, they capture some of the key economic and social moments during and immediately after the Second World War. Because they were written while events unfolded, the significance of some of the events he reports on did not become apparent until later.

Balogh’s weekly, and in later years fortnightly, reports were sent through the Bank’s London Office and as such form part of the London Letters series, in which they are interspersed with other branch information and correspondence.

Scope of letters

Balogh’s letters cover a wide range of subjects. As he was never afraid to include personal views regarding the many personalities of the time, his observations are often very frank. ‘His writing was bold, incisive and abrasive, sometimes outrageous …’² At other times he could be ‘… very critical of other economists and public figures, but his reports were always thorough and detailed, particularly regarding … the war situation, developments in British and international politics and political gossip’.³

Relationship with the Bank

Balogh’s association with the Bank was kept secret and the distribution of his letters was tightly controlled. At several times during his tenure in the 1940s, his contract with the Bank was nearly discontinued ‘… because he was clearly rubbing people up the wrong way. He was quite a radical economist and, at times, a fierce critic of the Bank of England …’⁴

Some of his letters were, from time to time, summarised by Bank staff and sent to other Australian institutions and the government for information purposes. While ‘…many of his views would have been contrary to what would have been the perceived wisdom in the Bank at that time… [and] even though he had many detractors, there were others, including figures like Melville, Giblin and Coombs who were very stimulated by what he said’.⁵

Balogh visited Australia in the 1950s. At the time of his visit he was still producing regular reports for the Bank. Dr Coombs also met with Balogh and other economists, including Kaldor, during a visit to London in May 1962.

Related materials

Balogh left his personal papers to Balliol College Library at the University of Oxford. Included in these papers are reports he wrote to the Bank. To view the Balogh Papers, researchers will need to contact the College Archivist directly.

Footnotes

¹ The term ‘Bank’ refers to the continuous entity of the Commonwealth Bank of Australia which was renamed the Reserve Bank of Australia in 1960 when it commenced operations as Australia’s central bank. The Reserve Bank Act 1959 separated the Commonwealth Bank's central banking functions from its commercial banking activities. The Commonwealth Bank was renamed the Reserve Bank of Australia and was constituted separately from the newly created Commonwealth Banking Corporation, which would operate as a trading bank.

² Evan Mann quoted in RBA (Reserve Bank of Australia) (2013), ‘In Search of Balogh’, Currency, September, pp 15-16.

³ Evan Mann quoted in RBA (Reserve Bank of Australia) (2013), ‘In Search of Balogh’, Currency, September, pp 15-16.

⁴ Evan Mann quoted in RBA (Reserve Bank of Australia) (2013), ‘In Search of Balogh’, Currency, September, pp 15-16.

⁵ Evan Mann quoted in RBA (Reserve Bank of Australia) (2013), ‘In Search of Balogh’, Currency, September, pp 15-16.

This information is drawn from records held by the Reserve Bank of Australia Archives and the following external sources:

Morris J (2007), The Life and Times of Thomas Balogh: A Macaw Among Mandarins, Sussex Academic Press, Brighton.

The letters and reports from Balogh are contained within the ‘From London’ records in the London Letters series.

In addition, Research Department series containing the following records:

• Thomas Balogh’s London Review, from 1945 to 1957
• Thomas Balogh’s Special Articles, from 1938 to 1953
• Thomas Balogh's Project - Food & Agricultural Organisation of the United Nations, 1957
• Thomas Balogh’s Letters, from 1962 to 1964