Paul A. Samuelson, 94
Nobel Prize-winning economist Paul Samuelson dies at 94
Monday, December 14, 2009
Economist Paul A. Samuelson, 94, who won a Nobel Prize for his effort to bring mathematical analysis into economics, advised presidents since John F. Kennedy on tax policy and wrote a textbook read by millions of college students, died Dec. 13 at his home in Belmont, Mass. No cause of death was reported.
For more than three decades, he was a major figure in national and international economics, synthesizing a century of economic insights, many of them apparently at odds with one another, into a coherent point of view.
He was among a circle of JFK advisers, among them John Kenneth Galbraith and Walter Heller, who led Kennedy to recommend the historic income tax cut that Congress eventually passed in early 1964.
"A temporary reduction in tax rates on individual incomes can be a powerful weapon against recession," Dr. Samuelson had written in a report to Kennedy in early 1961. The cut was widely credited with helping foster the 1960s economic boom. More than a dozen years later, he was asked by President Gerald Ford to an inflation summit conference, where he told the country that America was stricken with a bad case of "stagflation," a toxic mix of high unemployment and high inflation.
He also shaped professional and popular attitudes toward economics through his columns in Newsweek magazine from 1966 to 1981, as did his friend and political adversary, conservative economist Milton Friedman. (The Robert Samuelson who now writes a business column for Newsweek is no relation.)
But perhaps his most lasting achievement was a 1948 textbook, compiled from his lectures at the Massachusetts Institute of Technology. "Economics" is now in its 19th edition; the more recent editions were co-written by William D. Nordhaus of Yale. It has sold more than 4 million copies in more than 40 languages.
"I knew it was a good book, but what I didn't realize would be its lasting power," Dr. Samuelson said in a 1998 Associated Press interview. He said his aim was to make economics "understandable and enjoyable. . . . I think economics -- and this is what I've tried to impart -- has a tremendous amount of human interest in it."
Dr. Samuelson in 1970 was the first American, and the second person, to win the Nobel Memorial Prize in Economic Sciences, created in 1968 by the Central Bank of Sweden. The other Nobels have been awarded since 1901.
In 1996, he received the National Medal of Science, America's top science honor, from President Bill Clinton.
Born in Gary, Ind., on May 15, 1915, Paul Anthony Samuelson graduated from the University of Chicago in 1935 and received a master's in 1936 and a doctorate in 1941 from Harvard University. He joined the MIT faculty in 1940 after Harvard did not offer him a job based, at least in part, on his Jewish heritage. He stayed at MIT, building its economics department into a powerhouse, until 1985, when he officially retired.
He recalled families coming to his own family's home during the Depression, seeking a handout of a single potato to keep them from starving. That experience, and the blindness of classical economists to the woes of working people who were without jobs, influenced him in college to become a follower of British economist John Maynard Keynes. Keynes proposed that a nation needs an activist government that could foster low unemployment by steering tax and monetary policies, even if it meant deficit spending at times.
In his 1947 book "Foundations of Economic Analysis," he said that classical economists had been practicing "mental gymnastics of a particularly depraved type" and that they were "highly trained athletes who never ran a race."
As controversial as Keynesian economics was in the 1930s and 1940s, it later became mainstream economic consensus. As the years passed, Dr. Samuelson became less of a pure Keynesian but showed that he had not lost his ability to go against the flow of common assumptions. In 2004, he attacked the widespread belief among economists that outsourcing and globalization would be good for the U.S. economy.
In an article for the Journal of Economic Perspectives, he wrote that gains from globalization would not necessarily outweigh the losses for Americans. "Being able to purchase groceries 20 percent cheaper at Wal-Mart does not necessarily make up for the wage losses," he said in an interview after publication. "You need more temporary protection for the losers. My belief is that every good cause is worth some inefficiency."
He predicted in January in New Perspectives Quarterly that the economy was unlikely to recover from the current recession before 2012.
He married Marion Crawford, a fellow economist, in 1938, and he credited her with helping in his early research. She died in 1978.
Survivors include his second wife of 28 years, Risha Eckhaus Samuelson, of Belmont; six children from his first marriage; a stepdaughter; a brother; and 15 grandchildren. President Obama's chief economic adviser, Lawrence Summers, is a nephew.