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Conference : The International Circulation of Ideas: Producers, Brokers and Agents

With a Little Help from my Zurich Friends

Author/s : Olivier Longchamp & Yves Steiner Thomas Brisson

Started in the 1930s, the restoration of neoliberal ideas owes a lot to the foundation of the Mont Pèlerin Society (hereafter MPS) at the end of World War II. As a key network were neoliberal ideas could be achieved, discussed and diffused, this society has served as the main forum for neoliberal economists and intellectuals . Its major architects, Friederich Hayek and Wilhelm Röpke were convinced of the necessity to achieve these aims outside usual academic circles or national associations, which were at that time overflowed by the so-called Keynesian avalanche. However, creating and maintaining the MPS implied finding its material support, which had to be found outside these traditional circles. Hence, if the restoration of liberalism meant on the one hand a permanent theoretical effort, it also implied at the same time an enduring quest for financial support. If the former issue has been well studied by students of neoliberalism, the latter one, which is at the center of this paper, has not received the attention it deserves.

Funds for the MPS were raised thanks to the crucial support of key sectors of Swiss elites alongside a handful of American donators., two sets of actors that eagerly supported the first meeting of the MPS . This alliance underlines how such circles shared Hayek and Röpke’s plans: being able to rebuild in the long term a new liberal ideology without neglecting virulent critics against planned economy in its various hues (Marxist, Socialist, Keynesian, etc.). It is important to underline here the fact that the Swiss bourgeoisie stood very close to the renewal project of the neoliberal ideology. This bourgeoisie was at that time facing the temporary loss of the major references that the neighbouring German elites had represented since 19th century. The major commitment of Swiss business elites in the MPS was also a way to restore connections with their British and American partners in hard times. Swiss close economic collaboration with the National-socialist political economy during WWII was strongly condemned at that time, especially in the USA. It should be stressed also that this support implied implicit political benefits, particularly in the early years of the Cold War, as it firmly welded Swiss elites to the Atlantic alliance against Communism.

If we consider Swiss employers’ attitude, it is obvious that the April 1947 first meeting of the MPS put the restoration of liberal ideas at an international level a key preoccupation of these elites . This restoration project found its materialization when Albert Hunold, secretary of the MPS, and Hans Sulzer, a leading Swiss business executive, decided in 1950 to transform the Schweizerisches Institut für Auslandforschung (Swiss Institute of International Studies, SIAF) to advance the neoliberal cause. This private institute created in 1943 was closely linked with the University of Zurich and funded by generous donations from business elites. The SIAF had been created in the middle of WWII to help improving new contacts between Swiss intellectual and governmental circles and the academic world of Allied nations, but had apparently failed in that ambitious project. In 1949, the SIAF found a new mission aim as it was briefly used as a vessel to help Hayek to find tenure as a Professor in Zurich. Under Sulzer’s guidance, the SIAF opened in March 1950 a new Economic Department (Volkswirtschaftliche Studien) that was headed by Albert Hunold, whereas the old core activities of the SIAF were sidelined into a Cultural Studies Department (Kulturwissenschaftliche Studien). In 1958, both sections merged after the eviction of Professor A. Steiger, Director of the latter Department, who had been accused of embezzlement at the University of Zurich and at the Swiss Federal Institute of Technology. From this time onwards, Hunold managed the whole Institute until his retirement in 1966.

In 1950, Hunold's first task was to ensure sound financial bases for the Institute by collecting money from Swiss bankers and entrepreneurs. Between 1950 and 1966, the SIAF received about €3.1 millions from such circles2003 (around €338'00002003 each year), of which four fifth were devoted to its Economic Department Among 40 private donators, the main contributors were Hans Sulzer’s own firm, Gebruder Sulzer, the two main Swiss banks, Crédit Suisse and UBS, the reinsurance giant Schweizerische Rückversicherung and the Ciba pharmaceutical and chemical company (now part of Novartis). With this considerable endowment (which amounted in 1950 to the budget of five full professor chairs at the University of Zurich), the Economic Department developed its activities in two main areas: public lectures at the University of Zurich (and also, since 1958, in downtown Zurich) and publications. Thanks to these two outreach programs, the SIAF achieved to consolidate and entrench neoliberal positions in the University of Zurich and more largely contributed to the diffusion of these positions in the German-speaking world.

In 1950/1951 for example, Hunold organised no less than 44 lectures – approximately one every two weeks – at the University of Zurich. The speakers’ roll call contained prestigious names (Ellis, Knight, Dennison, Haberler, Hayek, Jewkes, Machlup, Plant, Rappard, Röpke, etc.) as well as prestigious universities (Cambridge, London School of Economics, Harvard, Princeton, Chicago, etc.). At that time, the University of Zurich had neither the financial means, nor the indispensable connections and address book to organise such lectures. Indeed, 21 of the 23 speakers invited to give these 44 lectures were MPS members. Moreover, between 1950 and 1958, more than two thirds of SIAF lectures were given by MPS members (Haberler, Röpke, Machlup, Hayek, Lutz, Gideonse, Jewkes, Baudin, etc.). SIAF lectures were a success and attracted a large audience. On average, more than 100 persons attended these events at the beginning of the 1950s. At the end of the decade, this number even increased to 390. In November 1958, Röpke lectured in front of 650 people, or four times the total student enrolment in economics at the University of Zurich.

SIAF lectures contributed to spread neoliberal ideas inside the academic sphere and in Zurich. They also offered an informal meeting point for persons interested in such ideas. Students in economics at the University of Zurich, but also businessmen, politicians or media professionals attended SIAF lectures and participated to more informal gatherings in Zurich. Thus, SIAF lectures acquired an essential role in setting up socializing activities inside the Swiss bourgeoisie under the umbrella of academic discussions on neoliberal ideas. For neoliberal authors, the SIAF became one of the main European platforms from which theirs opinions could be launched. Strongly supported by the Swiss bourgeoisie, the SIAF was a passage obligé for MPS members that could benefit there from repeated , and well remunerated, invitations.

With the crucial help of the Eugen Rentsch Verlag publishing house, the SIAF also took in charge the publication of volumes of collected essays and reviews, the translation and the diffusion of neoliberal writings. Between 1951 and 1970, Eugen Rentsch published 14 volumes of collected essays that formed a SIAF series of economic studies. In 1965, 70% of the copies of these books (or around 23,000 copies) had been sold or distributed. There again, almost 70% of the contributors were MPS members. More interestingly, around 40% of the contributions were translated from English, French or Italian into German. By translating these contributions, the SIAF helped to publicize the views of key non-German-speaking neoliberal authors who were rarely translated into German at that time. In the same vein, the SIAF, with the help of German and French employers' associations, contributed to set up the Editions Occident at the beginning of the 1960s. Lead by Albert Hunold, Jacques Freymond (William Rappard's successor at International Institute for International Studies in Geneva) and Lorenz Stücki (of the highbrow Weltwoche weekly magazine), this project was planned to publish Russian translations of classical works about liberalism and to diffuse them beyond the Iron Curtain.

Apart from lectures and publications, the SIAF also contributed financially and logistically to the renewal of neoliberal ideas. Even if this task did not figure in the statutes of the Institute, Albert Hunold, acting as MPS Secretary, organised all the MPS activities from Zurich. A large part of the MPS administrative work was thus supported by the SIAF. Hunold also used the SIAF in order to collect funding for two important MPS meetings in 1953 and in 1957. The SIAF itself contributed financially to these gatherings, but also indirectly supported neoliberal authors by offering them generous fees for lectures or papers published by the SIAF . At the beginning of the 1960s, the SIAF progressively lost its intimate connection with the MPS – notably after Hunold's departure from the MPS in 1962 –, while continuing to be involved in an international network pushing for the renovation of neoliberal ideas. This paper has explored the different ways and means throughout which the SIAF provided a financial and logistical base for the post-war restoration of economic liberalism. As a concluding remark, we would like to emphasize once more the key role played by the SIAF on the Swiss and international levels during the early period of this neoliberal renaissance. During the decade leading the foundation of the well-known Institute of Economic Affairs in London, the SIAF turned out to be a forerunner of neoliberal think tanks, those famous institutions which would later serve as influential platforms for the circulation of neoliberal ideas. In other words, the Zurich-based SIAF can be considered as a key link between the 1947 first convening of the MPS and its institutional consolidation in an Anglo-Saxon setting from which it would lead the counter-revolution against Keynesianism and collectivist ideas.

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