The founder of the Institute of Economic Affairs argued free markets needed honesty. But his own financial success was based on smuggling – and the IEA was itself conceived with the help of a white lie.
Antony Fisher was determined to support Friedrich von Hayek’s international campaign to transform the ideology of the age. But it took almost a decade, and a remarkable reversal of fortunes, for his ambitions to take form.
The stockbroker left the City to run a diary farm full time, but in August 1952 the foot-and-mouth epidemic reached Sussex and government vets arrived to slaughter his herd of 52 shorthorns.
At that time the farm was losing £2,000 a year (almost £60,000 in today’s money). Antony, who railed against state interference in the free market, accepted government compensation and used the money to fly off to the United States.
There he met Dr F A ‘Baldy’ Harper, a free market radical and co-founder with Hayek of the Mont Pelerin Society. Baldy introduced Antony to two ideas that would change his life, change the way Britons eat, and ultimately change the way governments deal with economic crisis.
Baldy had been working for an economist for a the newly formed Foundation for Economic Education (FEE) with Henry Hazlitt, the man who put Hayek on the front page Readers’ Digest and fellow a member of MPS.
Richard Cockett, a libertarian historian, writes that Antony was “impressed by the work of the FEE in popularising the ideas of the free market through a vigorous education programme” and returned to Sussex with “the model for his think tank.”
Baldy also took Antony to the University of Cornell, where he had been recently forced out for teaching from The Road to Serfdom, which was conducting a livestock experiment with a new breed of chicken, the broiler.
An Honest Business
Antony was shown 15,000 birds in a single building and was told they grew to adult size with less grain and in less time than ordinary chickens. Antony “immediately grasped the full potential for large volume production in Britain.”
There was a very significant obstacle to his ambitions, however. The regulators had banned the importation of eggs without a licence, to protect native animals and plants from being overrun by invasive foreign pests and species. Surely he could not break the law?
“Business, which consists of an infinite variety of exchanges, cannot operate without honesty,” Antony would write years later. “The more complicated business becomes, the more necessary it is for honesty to prevail. Honesty is a form of certainty”.
But not for the last time, Antony decided to put business first and defy the regulators.
He flew back to Britain having “disguised 24 fertilised White Rock eggs by wrapping them in silver and bringing them back in his hand luggage”, according to his close friend and collaborator Gerald Frost.
The illicit eggs were taken to his farm at Framfield, East Sussex, where they were hatched three days later by his attentive 10-year-old daughter Linda.
Antony invested £1,000, took out a £5,000 bank loan and took on 12 staff in “the first attempt at factory farming in Britain”.
Within five years he was producing more than a million chickens at any one time. “In 1953, I started with a few hundred day-old chicks”, Antony would reflect.
“Fifteen years later the resulting company was sold for more than £20million…by 1968 annual sales exceeded £20 million and the value of each original Buxted £1 share had become about £550.
Rogue Traders
“Many investors (including me) made large sums of money in a business kept flexible by the absence of ‘government protection’.”
Antony had in his own life demonstrated a serious flaw in Hayek’s theory of the free market. This system depended on a free exchange of goods in which everyone knew the true price of everything.
The market would be contained within tradition and the rule of law. But if a man of Antony’s deep religious belief and moral codes would break the law and be richly rewarded what hope was there for the free marke?
Could it create a world where rogue traders would become rogue banks and rogue economies? Could we have known then what we now know?
Antony was invited to speak at the Mont Pelerin Society in Venice in September 1954 where again the state was identified as the threat to our well-being.
“I believe that agricultural legislation in England gives dangerous powers to the Minister of Agriculture,” he argued.
“Under a government or ministers so minded, the agricultural legislation would fit easily into a pattern of complete dictatorship!” He was invited that year to join Hayek’s secretive society.
Having made a fortune Antony would immediately use the cash to finance his political ambitions, setting up Britain’s first think tank.
He recruited a team of highly capable and avidly free market economists, journalists and business leaders to launch his war of ideas against the tyranny of the state.
But in doing so, he exposed another serious flaw in Hayek’s thinking.
Men were, after all, only meant to act in their own self interests and never for the good of society as a while. But there you have it.
An Entrepreneurial Approach
Antony knew his own mind. His first ally was Major Oliver Smedley (pictured), an accountant described as “privately educated, Metropolitan, and professional”.
He was also known even among fellow libertarians as being “fervent and obsessive in his belief in the beneficence of the free market”.
Professor Adrian Jones would also note that some of Smedley’s companies “seem to have taken a rather entrepreneurial approach to prevailing norms of financial ethics”.
The decorated paratrooper hired a bankrupt and convicted fraudster whose scam had driven his victim to suicide to manage his accounts.
He sold uncredited diplomas and, some years later, one of his businesses collapsed owing debtors £500,000.
Antony had met Smedley when he joined the Society of Individuals during the war and both men had written anti-communist screeds for a London newspaper.
Smedley had already set up “an array of conservative political, financial and entrepreneurial causes” and Antony turned to him for help.
In November 1955, Antony and Smedley signed the official documents registering the Institute of Economic Affairs after the latter came up with the name.
Antony donated £250 – and would soon be providing £12,000 a year from his personal fortune. Smedley wrote to Antony and advised they should be less than totally honest about the IEA from its inception.
It was “imperative that we should give no indication in our literature that we are working to educate the Public along certain lines which might be interpreted as having a political bias.
“In other words, if we said openly that we were re-teaching the economics of the free market, it might enable our enemies to question the charitableness of our motives.
“That is why this first draft is written in rather cagey terms”.
Antony could be characterised as naive at best in choosing Smedley to help in establishing his think tank. This choice of ally would come back to haunt him.
Next week: How the IEA recruited Thatcher, neoliberalism was made British government policy, and the state lost control of the country’s vast fossil fuel assets…just before climate change became a serious political issue.
